State of mobile advertising in US

The State of the U.S. Mobile Advertising Industry

and What Lies Ahead

Hans Fredericks, VP, Marketing Solutions, comScore, Inc.

Michael Becker, Managing Director, N.A., Mobile Marketing Association

Scott Hendrickson, VP, Advertising Sales, Where, Inc.

* Note: A copy of this presentation will be sent to all attendees within 48 hours of today’s webinar

© comScore, Inc. Proprietary.

Our Presenters

Michael Becker Managing Director, North America

Mobile Marketing Association

Hans Fredericks VP, Marketing Solutions

comScore, Inc.

Scott Hendrickson VP, Advertising Sales

Where, Inc.


Agenda

Current Understanding of Mobile Marketing

Mobile media data and insights into the mobile advertising

opportunity

Big Brands in Action: Hyper Local Use Cases and Best Practices


REDUCE FRICTION

PROTECT GUIDE MEASURE PROMOTE EDUCATE

COLLABORATE

www.mmaglobal.com

STIMULATE GROWTH

About the Mobile Marketing Association

Seven hundred (700) members strong, the MMA‟ primary focus is to establish

mobile as an indispensable part or the marketing mix.

The MMA works to promote, educate, measure, guide and protect the

mobile marketing industry worldwide.


comScore Digital Business Analytics

Audience Measurement

Site Analytics

Vertical Market Solutions

Social Analytics

Copy Testing

Campaign Verification

Ad Effectiveness

Cross Media

Mobile Audience Measurement

Network Analytics & Optimization

Customer Experience

& Retention Management

User Analytics

Advertising Analytics

Mobile Analytics

Un

ifie

d D

igita

l M

easu

rem

ent™

V0910


WHERE Ads™ Reaches 51MM Consumers

The Largest Hyper-local Mobile Ad Network

• Focused on “pre-checkin” and driving local commerce

• 100% of inventory is location targeted • 3.5B impressions/mo. via 275+ publisher

partners • 120,000+ hyper-local ad campaigns daily • Proprietary Relevancy Ad Serving Technology • Recently acquired by eBay / PayPal

Publisher Portal Hyper-local Reach


Mobile

It‟s a Big Deal

Really Big Deal!



Grabbing Everyone‟s Attention

Rich Media

Advertising

Whole World

of Apps


Mobile Web & HTML 5

Tablets



“If your plans don‟t include mobile,

then your plans are not finished.”

Wendy Clark, Senior Vice President, Integrated Marketing,

Coca-Cola (IAB Annual Leadership Meeting 2011)


Mobile Marketing Defined

“Mobile Marketing is a set of

practices that enable organizations

to communicate and engage with

their audience in an interactive and

relevant manner through any

mobile device or network.”

(Mobile Marketing

Association, 2009)


MISR image of the Central Amazon


Convergence of Mobile Context in Marketing

Mobile is pulling these forces of marketing together

Digital

marketing

Traditional

marketing


Available Mobile Paths

Content Proximity


Feature Phones


Smartphones


Connected Devices


Mobile

Engagement

Outdoor

Events

TV

Online

Point of Sale

Radio

Print

On

Package

Through Mobile Media

SMS

MMS

Inte

r-

net App

s

Cont

ent

Prox

.

Email

Two Inter-dependent

approaches to Mobile Marketing

Direct (“through”)

– Marketer Push

– Consumer Pull

Indirect (“with”)

– “Mobile Enabled Traditional

Media”

– Mobile Advertising


Source: MMA 2nd ANNUAL VIEW FROM MADISON AVENUE (2010)

Mobile Tactics Used U.S.


Mobile Advertising Delivery Mediums

Mobile Web SMS/MMS Mobile Video Apps

• Static/Animated/Rich

Media Banners

• Text Ads

• Expandable Ad Units

for iPhone and

Android

• Interstitials for

iPhone and Android

• Text Ads in SMS

or MMS

• Picture

messaging in

MMS

• Pre-roll video

• Post-roll video

• Banner (Idle Screen)

• Rich Media Ad Units

(In App)

• Static/Animated

Banners

• Text

• Interstitials

• Wallpapers

• Interactive Ad

Units

Different Ad Executions

Other Ad channels: Voice, Bluetooth, Search


U.S vs. Worldwide Mobile Ad. Rev.


Global Ad Revenue Share By Type „10 vs. „15


mobile is about…culture

Is mobile all about Technology?

It’s also about Culture.


Consumer Behavior Depends on the Category

Source: Bringing Life to the Mobile Segment. Carlson Marketing (2010)

Source: North American Technographics Benchmark Survey,

Q2 2010 (US, Canada)

Note: Examples of advanced activities include: downloading applications, checking

news/weather/sports, using mobile banking, checking flight/train/bus status,

researching or purchasing products, using navigation or GPS services, using

coupons, etc.


GSMA MMM Behavioral media

measurement

Complexity and fragmentation of mobile market requires an array of data sources

and methodologies for a 360° view

Ad Metrix Mobile Mobile Ad Tracking

Tools

Mobile Metrix Smartphone Meter Panel

Network Census Network Log Analysis

MobiLens Market Tracking via

Intelligent Online Survey

Site & App Census Mobile Web, App &

AdNet Tagging

comScore Mobile Measurement Methodologies


Mobile Media Users are Nearing a Majority in the US

Product: MobiLens

Data: Three month average ending March 2011

Country: US, N= 30,817

Mobile Media, 37.8%

SMS (and not mobile

media), 30.2%

Just Voice, 32.0%

Mobile Market Segments - March 2010

88.3 Million

Mobile Media, 45.7%

SMS (and not mobile

media), 27.2%

Just Voice, 27.1%

Mobile Market Segments - March 2011

106.8 Million

Mobile Media User = Used browser, application, native email, stream or download music

and broadcast or on demand video (does not include SMS)


Mobile Users Differ Dramatically by Mobile Activity and Content

Accessed

Unlimited Data Plan

Used Browser

Email

Purchased Ringtone

Mobile Media

Listened to Music

Used App

Purchased Game

Made Own Ringtone Social Networking

Ringback

Played Games

44%

45%

46%

47%

48%

49%

50%

51%

52%

53%

25 27 29 31 33 35 37 39

% F

em

ale

Median Age

Demographics of Mobile Media Activities Higher on chart = more female Further to right = older Size of bubbles = # of users

Product: MobiLens




Browser and Application Usage Showing Continuous Growth

*Excludes Mobile to Mobile

Product: MobiLens



28.6% 30.1%

37.3% 38.6%

30.6%

28.4%

25.0%

27.0%

29.0%

31.0%

33.0%

35.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

Used Application (except native games)

Used Browser

% Y

oY

-Gro

wth

% M

ark

et

Browser and Application Usage Growth

Mar-2010 Mar-2011 Year-on-Year Growth

0%

10%

20%

30%

40%

50%

App Browser

SMS* App OR Browser

App OR Browser OR SMS*

48%

45%

39% 37%

26%

Browser, App, SMS Usage


Facebook and Google Search Lead Market on Both Mobile and PC

Product: MobiLens / Media Metrix

Data: March 2011

Country: US

73% 72%

53%

46% 42%

34% 29% 28%

25% 20% 20% 18%

8%

0.4%

37%

52%

15% 11%

28%

12% 12%

24%

29%

14% 16%

22%

15% 10%

0%

10%

20%

30%

40%

50%

60%

70%

80%

% G

rou

p

Brand Market Share - PC vs Mobile

PC Mobile


Time Spent on Mobile Skews to Social Media Sites

Product: Mobile Metrix / Media Metrix

Data: March 2011

Country: US

269

82 59 56 52 42

22 21 11 6

347

215

79

144

203

22 32

130

17 13

Average Minutes per Visitor – Mobile vs. PC Internet (Top Mobile Properties)

Mobile

PC

652

315 269

154 82 80 74 64 61 59

107 97

347

95

215

3 2

155

30 79

Average Minutes per Visitor – Mobile vs. PC Internet (Top Mobile Minutes per Visitor Properties)

Mobile

PC


30.7%

40.2%

45.7%

32.1%

38.1%

43.3%

16.9%

24.8%

31.5% 33.4%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

50.0%

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

%Y

oY

-Gro

wth

Un

iqu

e U

se

r (0

00

)

Top 10 Mobile Categories - Year-on-Year Growth


Double-Digit Growth in All Major Categories – Led by Social Media

Product: MobiLens




Mobile Delivering Incremental Reach; Mobile Only is Over 40% of

Pandora‟s Audience

Visitors

Home/Work PC

Home/Work PC and Mobile

Mobile

13,381

7,135

11,126

42%

23%

35%

Pandora – Total Universe

Audience (000)

Product: comScore Total Universe Report.

Data: April 2011

Country: US

Beta Data

2.3%

6.7%

4.9%

5.5% 5.2%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

NY Times LA Times Wash Post WSJ Chicago Trib

Inc

rem

en

tal R

ea

ch

To

tal U

niv

ers

e A

ud

ien

ce

(0

00

)

Total Universe Audience Incremental Reach

Incremental Reach from Leading U.S. News Brands' Mobile Websites

Source: comScore Total Universe Report, U.S., April 2011 (beta data)


Mobile Social Media Booming in US

Almost daily users of mobile

social media +70% - growing

faster than category

Conversational Media in Mobile

Metrix (smartphone panel) has

71% reach

– 36% minutes, 44% PVs

– Nearly all is Facebook with 87%

of category minutes and 83% of

PVs 0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Almost every day

At least once a week

One to three times in the month

US Social Media Unique Mobile Users

Product: MobiLens, Mobile Metrix


Country: US


Top Apps Largely Free – Ads Key to Monetization

Among top 50 apps with widest reach, „Angry Birds‟ is the only paid app

During March 2011, 12.7% of downloaded apps were paid – including five of the top 20 (Angry Birds, Cut

the Rope, Fruit Ninja, iSlash, Angry Birds Seasons) and ten of the top 50

Product: iTunes App Tracker

Data: Downloads Ever – March 2011

Country: US

Rank Title Developer Genre Free / Paid % Reach of all Apps

Downloaders

1 Facebook Facebook Social Networking Free 59.6%

2 Pandora Radio Pandora Media, Inc. Music Free 38.0%

3 Paper Toss Backflip Studios Games Free 28.6%

4 Google Search Google Reference Free 22.9%

5 Backgrounds Stylem Media Entertainment Free 22.7%

6 Google Earth Google Travel Free 22.2%

7 Touch Hockey: FS5 (FREE) FlipSide5, Inc. Games Free 21.7%

8 Skype Skype Software S.a.r.l Social Networking Free 21.4%

9 Myspace MySpace.com Social Networking Free 21.2%

10 Movies by Flixster, with Rotten

Tomatoes - Free Flixster Entertainment Free 20.8%

Top 10 iTunes Apps


More Advertisers are Turning to Mobile – With Growing Diversity of

Categories and Advertisers

Product: Ad Metrix Mobile

Data: April 2009 - April 2011

Country: US

26%

3%

6%

2% 7%

50%

5%

1%

March 2011 – Advertised Categories

Consumer Discretionary

Consumer Staples

Financials

Industrials

Information Technology

Mobile Content and Publishing

Telecommunication Services

Other

0

100

200

300

400

500

600

700

800

Number of Display Advertisers


50%

12%

36%

16%

32%

18%

8%

30%

0%

10%

20%

30%

40%

50%

60%

SMS Ads Received Responded to SMS Ads

SMS Ad Type – Received vs. Responded

Info about product/service/brand Coupon or discount Contest Donation to charity/non-profit

Mobile subscribers receiving – and responding to SMS ads

28% of mobile subscribers in the US received one or more SMS Ads in March 2011; of those, 17%

responded to at least one SMS ad

Product: MobiLens



Received SMS Ad: 66.1 million

Responded to SMS Ad: 11.3 million


Smartphones Critical to Mobile Advertising Opportunity

4%

5%

16%

19%

8%

28%

85%

82%

0% 20% 40% 60% 80% 100%

Responded to SMS ad

Saw Ad on Web/In App

Used App*

Used Browser

Service Penetration

Smartphone

Feature Phone

*Except native games

Product: MobiLens




Popularity of Smartphones is Increasing – Bodes Well for Advertising

Product: MobiLens



20.0%

31.0%

80.0%

69.0%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Mar-2010 Jun-2010 Sep-2010 Dec-2010 Mar-2011

Penetration – Embedded Base

Smartphone Feature Phone

29.3%

47.7%

70.7%

52.3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Mar-2010 Jun-2010 Sep-2010 Dec-2010 Mar-2011

New Devices Acquired

Smartphone Feature Phone


Google‟s Android Now In the Lead on Smartphones

Product: MobiLens



422%

1%

56%

-20% -19%

19%

-50%

0%

50%

100%

150%

200%

250%

300%

350%

400%

450%

0

5,000

10,000

15,000

20,000

25,000

30,000

Google RIM Apple Microsoft Palm Symbian

% Y

ea

r-o

n-Y

ea

r G

row

th

Mo

bile

Ow

ne

rs (

00

0)

Smartphone OS Growth

Mar-2010 Mar-2011 YoY Growth

Google, 35%

RIM, 27%

Apple, 25%

Microsoft, 7%

Palm , 3%

Symbian, 2%

Smartphone OS Share


Ecosystem Competition Extends Beyond Smartphones

With iPad and iPod Touch, iOS

holds significant lead in

addressable audience for

developers

– Installed base of 44M devices

(65% more than Android)

Product: MobiLens



0

10

20

30

40

50

iOS Android

Platform – Installed Base (M), March 2011

Smartphone Other Device


Tablets and other connected devices redefine “mobile” for advertisers

25%

15%

7%

23%

20%

8%

2%

30%

Share of Page Views by Device Type and Platform

Smartphone -Android

Smartphone -Other

Smartphone -Blackbberry

Smartphone -iOS

iPad -iOS

iPod Touch -iOS

Connected Device -Other

All Connected Devices Excluding Smartphones

Product: Connected Device Reporting

Data: March 2011

Country: US


Growth in check-in and location-aware devices and services creating

new opportunities

Product: MobiLens



27.8%

23.3%

19.3%

12.0% 11.0%

8.9%

5.0%

40.2%

32.1%

43.3%

27.5%

40.4%

28.4% 29.2%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

50.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

Weather Search Maps Movie Information

Restaurant Information

Traffic Reports Travel Service

% Y

oY

-Gro

wth

% M

ark

et

Location Based Services



To Sum

The mobile audience is growing rapidly

Multiple high reach advertising opportunities available – web, app, SMS

Major PC publishers building large mobile audiences, often incremental

Engagement increasing as mobile media usage becomes daily activity

Mobile social is the standout category

Mobile advertising is broadening, and also key to app monetization

Smartphones are key driver of audience, usage, advertising

Tablets and other connected devices redefining “mobile” for advertisers

Growth in check-in and location-aware devices and services creating more

localized advertising opportunities


Hyper-Local Use Cases and Best Practices

Scottie Pippen Michael Jordan

Wile E. Coyote Road Runner

Location Mobile Advertising



Hyper-Local Formula

Reach + Relevancy Redemption/Engagement



What WHERE is Seeing…

Location Dynamic Ads are outperforming static creative by 30%

Location Dynamic Ads are driving strong secondary engagement metrics:

40% of consumers are showing purchase intent

30% of consumers are “clicking to social”

20% of consumers are redeeming mobile offers

Dynamic Targeting of ads is driving a 60% increase in performance


Hyper-Local Precision Targeting: Geo-Fencing

– Store fronts

– Competitor Locations

– POI (Airports, Schools, Theme Parks, etc.)

– CPG‟s: Targeting Key Shopper Marketing Partners


.02 mi.



Hyper-Local Dynamic Targeting: “Roaming Geo-Fences”

– Weather

– Flu Index

– Store Performance Data

– Inventory Data


Event Based Marketing:

– Retail Events

– New Product Announcements

– Grand Openings

– Local Events and Sponsorship Activation




Hyper Local Content and Engagement: How can you align your

brand with what is happening around the consumer?

Weather

Local Sports Scores

– Local News or Traffic

Inventory (Popular local items, etc…)

Local Places…Aid in Local Discovery



What to expect in the future…

The evolution of hyper-local advertising into commerce

Big Data and Relevancy will be king

A Multitude of Location Dynamic Offers

Inventory based offers

Store Performance based offers

Smarter Tools for Marketers to manage margins and drive sales

via real-time offers


Remember

Mobile isn‟t about mobile…it is about engagement and the value

consumers and you generate for each other

Mobile is both a standalone media and a enabler for traditional media and

will help you with:

– Branding, Awareness, Loyalty/Retention, Care

and Social Media Enablement

You can embrace mobile today, there are many resources.


Questions & Answers


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Thank you!

Hans Fredericks

[email protected]

Michael Becker

[email protected]

Scott Hendrickson

[email protected]

mailto:[email protected]



