The Mobile Only Internet Generation

1. The ‘Mobile Only’ Internet Generation December 2010 Alistair Hill

2. The ‘mobile only’ Internet generation In developed economies the mobile internet is commonly thought of as an extension of the desktop internet, providing an additional, convenient and portable access method. However for many people around the world, the mobile phone will be the primary, or only way to access the internet. This will have profound effects, not only on the lives of these people, but on the Internet industry and the way brands communicate and interact with these consumers – the nextbillion consumers. In the first of a quarterly series, summarising recent client studies, On Device Research will examine this new segment, the ‘Mobile Only’ Internet generation.

3. On Device Research services On Device Answers On Device Effectiveness On Device Panels Global consumer research panels. Quick and affordable insight from any country with a focus on emerging markets. Device agnostic survey product. Works on web enabled feature phones, smartphones, PC, iPad, etc. Advertising effectiveness studies using mobile surveys and diaries.

4. Research methodology Data analysed to retrieve insights Mobile Internet survey created through On Device Answers Respondents recruited through On Device Panels <ul><li>Online interface allows clients to create and edit surveys.

5. 5 question types available.

6. Automatic identification of device, carrier and GPS location (where possible).

7. Consumers fulfil survey on the mobile internet.

8. The sample is representative of mobile internet browsers and weighted by OEM share and demographics.

9. Survey results are processed and analysed.

10. Analysts deliver insight on consumer behaviour and attitudes.</li></li></ul><li>Definitions The ‘Mobile Only’ Internet Generation Those who use the mobile internet but have either never used or only use the desktop internet once a month or less. Desktop Internet Accessing the internet via a desktop, laptop, netbook or tablet computer.

11. The Mobile Only Internet Generation Mobile Internet Usage in: Africa Asia Net Promoter for Mobile Internet Agenda

12. The ‘Mobile Only’ Internet Generation The ‘Mobile Only’ internet generation are an exciting new group of the world’s population. For the first time these people have the opportunity to access news, information, communication and retail services similar to those used by the first, desktop, Internet generation. The profile of this group differs based on their location: <ul><li>Developing nations – Young (70% under 25 years old), mostly male and often still students. Early adopters who already have a mobile device and for small additional costs can gain access to the internet.

13. Developed nations – Older, more even gender split, skewing towards lower incomes. Late adopters, who already own a mobile phones and are attracted by the convenience and lower overall cost of accessing the internet via their mobile device.</li></li></ul><li>The mobile Internet is becoming the sole or primary access method for many It has often been assumed that the mobile Internet will be the sole access method for many. The results of recent client studies show that for roughly 50% of African and Asian mobile internet browsers this is the primary access method.. In contrast 22-25% of US and UK mobile internet browsers never or infrequently use the desktop internet. Countries: Egypt, South Africa, Ghana, Nigeria, India, Indonesia, Thailand, China, US, UK and Russia Date: July- November 2010 -N= 15,204

14. Emerging markets ‘mobile only’ browsersare mostly under 25 In emerging markets the vast majority of the ‘mobile only’ are under 25, the vast majority are male and many are in education. In the developed world the ‘mobile only’ are a different segment. In the UK they are split more evenly with 58% over 25. The US however provides interesting results, with most being over 25 and many on lower incomes. Countries: Nigeria, India, US, and UK Date: July- November 2010 N= 6165

15. 55% of Indian ‘mobile only’ are students Over half of the Indian ‘mobile only’ are in either school or university, indicating that a level of intelligence is required to have either the curiosity or know how to go on the mobile internet. This young and educated group are the worlds future internet users and will make up a large part of the worlds next billion consumers. Countries: India Date: July 2010 N= 1070

16. In the US, the ‘mobile only’ skew towards lower incomes Mobile browsers with household income of under $25,000 per year are 19% more likely to not, or rarely, use the desktop internet. If we couple this information with the demographic data it becomes clear that there is a large group of lower income over 25’s who only use the mobile internet but rarely, or never, use the desktop internet. Countries: US Date: November 2010 N= 1290

18. The Emerging markets opportunity The new digital audience creates opportunities for brands, Internet, media and financial services companies. The following section highlights some of these: Internet Companies + Brands – There is an appetite for mobile friendly Internet services (email, social networking, news, etc) many of which are ad funded. Brands have a new opportunity to market to these users, reaching the previously unconnected emerging middle classes in developing countries. Media – Downloading content is extremely popular (games and music downloading are the top browsing genres in Africa). Media companies have the opportunity to market and sell directly on the device where the content will be consumed, to an audience who don’t have the option to download on PC. Financial – Many ‘Mobile Only’ browsers don’t have a back account (in India 57% of the ‘Mobile Only’ don’t have a bank account). All of these people have a billing relationship with their mobile operator, giving them the opportunity to purchase electronically for the first time.

19. Content downloads and social networking leads mobile browsing behaviour in Africa Over 50% of mobile browsers go to sites for downloading games and music. Communication services such as social networking and email are popular. Almost half of respondents use search. Countries: Nigeria, Kenya, Egypt, South Africa, Ghana, Tanzania, Senegal Date: October 2010 N= 7325

20. Opera provides quasi-smartphone experience for feature phone users in Africa Opera users are 33% more likely to use social networks than Non-Opera users and are comparable in behaviour to UK mobile browsers. In the UK, smartphone owners are 20% more likely to use social networking than those who don’t own a smartphone. Countries: Nigeria, Kenya, Egypt, South Africa, Ghana, Tanzania, Senegal, UK Date: October 2010 N= 7325 + UK=1448

21. Nokia dominates mobile browsing in Africa 85% accessed the internet with a feature phone. Of the 15% who used a smartphone nearly all were Nokia Symbian devices with almost no reported use of Android or iPhones. Countries: Nigeria, Kenya, Egypt, South Africa, Ghana, Tanzania, Senegal Date: October 2010 N= 7325

22. 66% of Kenyan ‘mobile only’ users download mobile music With limited or no access to the desktop Internet for many in Africa, the mobile Internet provides a significant opportunity for media and content companies. 66% of the Kenyan ‘mobile only’ have downloaded music on their mobile, with almost half downloading games and videos. Countries: Kenya Date: October 2010 N= 1009

24. 75% of Indonesian mobile browsers use social networks Only 39% of Indian browsers use social networking. Social networking is interactive and lends itself to faster data speeds. India currently doesn’t have mass market 3G services, Indonesia does. Search is the most popular mobileInternet activity in India. Indian browsers look for cricket scores, Indonesian for soccer (football). Countries: India + Indonesia Date: July-August 2010 N= 2138

25. Over 90% browse the mobile Internet at home With roughly half of Indonesian and Indian mobile browsers not using the desktop internet and over 90% using it in the home, it becomes clear that the mobile will play a very different role in these Asian countries compared to western markets. Countries: India + Indonesia Date: July-August 2010 N= 2138

26. 57% of the Indian ‘mobile only’ don’t have a bank account In India, not only do the ‘mobile only’ not use the desktop internet but 57% also don’t have bank account. There is a huge opportunity for the previously unbanked and unconnected to use electronic payments to purchase goods and services. Everyone of this 57% has a billing relationship with their mobile operator. Countries: India Date: July 2010 N= 1070

28. Net Promoter A measure of customer loyalty and word of mouth momentum We Asked: On a scale of 1 to 10, how likely are you to recommend using the internet on your mobile phone to friends and family? (1 Unlikely to Recommend, 10 Likely to Recommend) Customers respond on a 0-to-10 point rating scale and are categorized as follows: <ul><li>Promoters (score 9-10) are loyal enthusiasts who refer others and fuel growth.

29. Passives (score 7-8) are satisfied but unenthusiastic customers

30. Detractors (score 0-6) are unhappy customers who impede growth through negative word-of-mouth.</li></ul>Net Promoter Score (NPS) = percentage of customers who are Promoters minus percentage of customers who are Detractors.

31. Consumers love the mobile Internet The mobile internet is going through significant growth in terms of unique users (see comScore, Opera or Admob stats). There are significantly more promoters of the mobile Internet than detractors, meaning that most people are recommending the mobile internet to friends, providing word of mouth momentum and provoking future growth. Countries: Nigeria, Kenya + US Date: October- November 2010 N= 3501

32. In Africa – Opera makes a big difference Nigerian Opera Mini browsers are far more likely to recommend the internet to friends and familythan the average browser. The vast majority of mobile internet browsers in Nigeria use feature phones. Countries: Nigeria Date: October 2010 N= 1167

33. In the US – high-end smartphones make difference Mobile browsers with high end smartphones (Android and iPhone) are far more likely to recommend the mobile internet to friends and family. Countries: US Date: November 2010 N= 1290

34. Alistair Hill On Device Research alistair@ondeviceresearch.com +44 (0) 7931 518 232 Thank You