Wireless Industry Insights: Devices and Carriers

Key factors to consider for your marketing message this fall

According to Pew Research:

• 56% of American adults are smartphone owners

• 35% of U.S. population still using feature phones

• 10% increase in U.S. smartphone adoption from 2012

• {No cell phone} rate declines in 2013 compared to 2011 (-2%).

• 9% population is tracked as carrying no cell phone

• 8% of Americans age 65 and older now own a smartphone, compared with 13% in February 2012.

Smartphone Ownership Continues to Grow in 2013

Source: Pew Research Center’s Internet & American Life Project , 2011 – 2013 tracking surveys

Tablet Ownership Grows Faster in 2013

Source: Pew Research Center’s Internet & American Life Project , 2011 – 2013 tracking surveys

• A third (34%) of American adults ages 18 and older own a tablet computer like an iPad, Samsung Galaxy Tab, Google Nexus, or Kindle Fire—almost twice as many as the 18% who owned a tablet a year ago.

• Unlike smartphones, which are most popular with younger adults ages 18-34, we see the highest rates of tablet ownership among adults in their late thirties and early forties. In fact, almost half (49%) of adults ages 35-44 now own a tablet computer, significantly more than any other age group.

• Adults ages 65 and older, on the other hand, are less likely to own a tablet (18%) than younger age groups

Parents with Minor Children Adopt Tablets Faster in 2013

Source: Pew Research Center’s Internet & American Life Project , 2011 – 2013 tracking surveys

• Among parents with minor children living at home,

tablet ownership rose from 26% in April 2012 to 50%

in May 2013 (an increase of 24 percentage points).

• Tablet ownership among adults living in households

making at least $75,000 per year rose from 34% to

56% (22 percentage points).

• Tablet ownership among college graduates rose from

28% to 49% (21 percentage points).

Our Audience More Likely to Research and Buy New ElectronicsWhen compared to Google, the Yahoo! Bing Network audience is more likely to:

Source: comScore US Plan Metrix Site Audience Profile, June 2013

Research before major offline purchase (5 rating/describes completely)

Research before major online purchase (5 rating/describes

completely)

Be the first to buy new gadgets (5 rating/describes completely)

Price is Biggest Factor For New Smartphone Buyers According to Recent Qualcomm study

Source: “Price is the biggest factor for smartphone buyers,” Qualcomm study in mashable.com, September 20, 2012

42% more likely to own Kawasaki71% of respondents influenced by price when selecting a new smartphone

42% more likely to own Yamaha68% of respondents looked for longer battery life

4% more likely to own Kia23% of the respondents purchased a new device after watching a product advertising

10% more likely to own Lexus25% of parents have purchased their child under 13 a smartphone

12% more likely to own61% of respondents said speed was an important factor

38% of customers who purchased iPhones in the last three months

upgraded from another iOS device , 31% upgraded from a basic

feature phone, and 20% switched from an Android device

42% of those who purchased a new

Windows Phone upgraded from a basic feature phone over the last three months

iPhone and Windows Phone Pricing Attracts First-time Smartphone Buyers

Source: “Android Leads in the US, but iOS and Windows are Growing Faster,” Kantar Worldpanel ComTech, June 3, 2013

Price is the main factor driving popularity of these brands among

new smartphone buyers. Older iPhone models are now available for free or at discounted rates, same as Windows devices that are priced for new smartphone buyers.

Price is Also Key in Selecting a Carrier According to comScore and Oracle Studies in the Last 2 Years

1 These statistics were compiled in December 2012 from comScore MobiLens.2 Oracle Mobile Trends: Consumer Views of Mobile Shopping and Mobile Service Providers 2011

42% more likely to own KawasakiIn Dec 2012, comScore MobiLens reported Price of the Device, plan and data

costs as the most important factors for consumers when choosing a new

carrier, along with network quality, latest devices and brand recognition. 1

Oracle study from 2011 capturing [Consumer Views of Mobile Service

Providers] also showed that 71 percent of consumers say they would switch to

a new carrier with better pricing. 2

Interestingly, according to Oracle study, pricing tends to be a bigger factor for

older consumers. 2

• 75% of consumers ages 55 and older and 73% of those ages 35 to 54 said

pricing plans and overall cost was one of the three biggest factors for

them when choosing a mobile provider.

• By comparison, 67% of those ages 18 to 34 cited pricing and cost.

Customer Service is Key for Carriers to Retain CustomersOnline customer service features like Live Chat are most popular

1 J.D. Powers: 013 U.S. Wireless Customer Care Full-Service Performance Study--Volume 2 and 2013 U.S. Wireless Customer Care Non-Contract Performance Study--Volume 22 Oracle Mobile Trends: Consumer Views of Mobile Shopping and Mobile Service Providers 2011

42% more likely to own Kawasaki

Oracle Mobile Trends study found across all age groups, 11% of respondents

said they had switched mobile providers because they were dissatisfied with

their former provider’s customer service. 2

The chat feature has become the leading contact source, as 42% of full-

service customers indicate using a live online chat feature vs. email (23%)

or other social media forum (16%). 1

A recent J.D. Powers study shows that online customer service channels are

increasingly becoming popular among consumers with highest satisfaction

rates compared to other contact channels 1

Device Upgrade and Buyback Plans Become Popular

Source: “18% of Americans would sign on to a handset upgrade plan, according to survey by New Street Research” Fiercewireless.com July 2013

42% more likely to own Kawasaki

T-Mobile, Verizon and AT&T introduced upgrade plans to

encourage users to upgrade to new devices 1

"These plans appeal to people that are interested in the latest and

greatest phones--those that are real mobile enthusiasts and can

think ahead and know that they need more than one upgrade in

the two years," IDC analyst Kevin Restivo told Bloomberg.

18% of Americans would sign on to a handset upgrade

plan, according to survey 1

Taking Advantage of these Insights this Fall

Target Feature Phone

Users with iPhone and

Windows Phone Pricing

Offers.

Consider Targeting Older and Senior Adults with Incomes Lower than

$74k. Target with Promotions and Discount

Offers.

Consider Highlighting

LIVE CHAT Features and

Customer Service Ratings

in Your Ads to Target New

Customers.

Married Couples with

Children and College

Students with Price /

Promotions.

1 comScore US Media Metrix Demographic Profile and Audience Duplication Reports, July 20132 comScore US Plan Metrix Site Audience Report, June 2013

Highlight PRICE POINTS

and PROMOTIONS

In Your Search Ads.

Yahoo! Bing Audience has

a strong audience

advantage for this

segment when compared

to Google:

• 4% more likely to be

between 35-44

• 13% more likely to be

between 45-54

• 25% more likely to be

55-64

• 25% more likely to be

65+

• 5% more likely to have

a HHI of $25K-$40K

• 7% more likely to have

a HHI of $40K-$60K

This study focuses on

surfacing key insights

that help in

determining the

optimal paid search

media and

optimization strategy

on the Yahoo! Bing

network during the

new iPhone release.

Our Discoveries

Searches for New Product Launches Typically Surge in Three Stages:a) pre-announcement chatter b) official release announcement c) product in-store date

Source: Smartphone Launch study 2013. Bing ads data 2012

Drive perceptional and conversion value

Take advantage of strong conversion value

iPhone 5 release timeline 2012

Stage A & B

Stage C

More than 50% searches during stage A and B.

Searches surge x300% at the time of initial

announcement leading up to the product ship

dates (stage C)

A handful of search keywords trigger these

spikes – 90% of the searches are brand related

keywords – product, carrier or product + carrier

16% of all iPhone related searches during this time period came from searchers looking up the exact brand name, in this case iPhone 5

Searches on Mobile Devices Show Similar Trendsa) pre-announcement chatter b) official release announcement c) product in-store date

Source: Smartphone Launch study 2013. Bing ads data 2012. Data based on iPhone related searches on mobile & tablet 4/29/2012 – 10/28/2012.

• iPhone related searches on mobile and tablet saw similar trends with a spike in searches close to days leading up to the

official announcement

• With the increased growth in mobile searches over the last few quarters, we should anticipate the # of searches to in both

mobile and tablet to increase this year. We recommend having appropriate mobile budgets for launches this year to

ensure proper coverage.

Sear

ches

MOBILE

Tablet

Demand for Predecessor Models Also Increases

Source: Smartphone Launch study 2013. Bing ads data 2012.

• Most device makers adjust the pricing

for older models as they introduce newer

versions

• Consumer searches surged for these

devices by roughly 200% on the day of

this announcement and sustained

gradual decline over the 30 day period

• While new devices equals net new

demand – search trends prove that

appropriate budgets need to be in place

to take advantage of increased demand

for older models based on pricing

updates

iPhone 4

iPhone 4s

Correlation Between Clicks and CPC

Source: Smartphone Launch study 2013. Bing ads data 2012. Data based on iPhone related searches in Sept 2012.

The days searches and paid clicks see a drastic increase, there is an opposite reaction to CPCs

We recommend bidding aggressively during these times and ensuring budgets are not running out

CPCs tend to normalize a few days following the drastic spikes – great opportunity for advertisers to take advantage of this trend

0

500,000

1,000,000

1,500,000

2,000,000

Searches vs. CPC

Searches CPC

0

50,000

100,000

150,000

200,000

250,000

Clicks vs. CPC

Paid clicks CPC

• “Wireless” related keywords

saw the highest

click-through-rates with

the lowest cost per

click during Sept

A few takeaways:

• Most searchers look for “release” related information during the weeks close to launch

• Searches for cases and accessories start to build up post release announcement with a gradual increase through the 30 day duration leading up to holidays

A Deeper Look Into Performing Keyword Segments

Source: Smartphone Launch study 2013. Bing ads data 2012. Data based on iPhone related searches between 9/1/2012 – 10/7/2012.

CTR

All iPhone Related Queries

Cases

Accessories

Unlock

Review

Release

Wireless

CPC

All iPhone Related Queries

Cases

Accessories

Unlock

Review

Release

Wireless

(10,000)

10,000

30,000

50,000

70,000

90,000

110,000

130,000

150,000

Sear

ches

All iPhone RelatedQueriesPhone Cases

Phone Accessories

Unlock phones

Phone Reviews

Release

Key Considerations

• Highlight price points and promotions

in ad title

• Target new segments of customers that

have a high propensity to respond to

your offers i.e. older and senior adults,

parents with children

• Highlight customer service tools like

help chat and any customer ratings

• Increase budgets through September

to take advantage of new iPhone

related search volume

With Substantial Share of Paid Clicks Across Telecommunications

Source: 1 comScore US Search Categories Report (custom), June 2013 2 comScore US Search Categories Report (custom), comparing March 2013 to June 2013

24% share of paid clicks

TECHNOLOGY

37% share of paid clicks

TELECOMMUNICATIONS

+12% increase in

TELECOMMUNICATIONS

Substantial share of paid

clicks across Telecommunications

and Technology categories1

Share of paid clicks on the rise

across Telecommunications category2

Spend

23% more than average online

population1

Total Yahoo! Bing Network spends about

6% more than US Google searchers1

Unique Yahoo! Bing Network spends about

18% more than US Google searchers1

Audience Buying Power Index

138

123

116

100

Unique Yahoo! Bing

Network

Total Yahoo! Bing

Network

Google

Average Internet

Reach an Audience that Spends More than Google

1 comScore Explicit Core Search (custom), June 2013

The Yahoo! Bing Network Audience Snapshot

Source: comScore Explicit Core Search, June 2013 / comScore Explicit Core Search (custom), June 2013

5.6BSEARCHES

163MUNIQUE SEARCHERS

IN THE US

54MUNIQUE SEARCHERS

NOT ON GOOGLE

29%SEARCH

SHARE

TOTAL SEARCHERS ON THE

SPEND

SEARCHERS WHO EXCLUSIVELY USE THE

5.6%MORE THAN

GOOGLE

SPEND 18% MORE THAN GOOGLE

Platform Updates

+1,000

Increased Efficiency

+21%

More Clicks

+25%

New Markets in 2012

+15

Based on internal data 2012

“The Yahoo! Bing Network has outperformed Google in return on ad spend, ending Q3 2012 with

the largest gap of the 18-month period at 28%.”Global Search Advertising Trends, Q4 2012

Paid Search Update, Q4 2012

“On [the Yahoo! Bing Network], advertisers saw marked improvement in clicks. On a year-over-year basis,

advertisers saw 25% higher click volumes.”

“Yahoo! Bing Network spend increased 48% Y/Y as the engine continued to deliver strong

impression growth on expanded keyword to query matching. Ad clicks rose 44% while CPCs increased 2%.”

“The “Yahoo! Bing [Network] continued to accelerate its growth with a YoY increase in spend of 48% compared to Google’s 12%.”

Analysts: Yahoo! Bing Network is More Effective Than Ever

Thank you