Just two topics this week - something we're really excited by and something we're less keen on.
 
Location
 
With more details of Facebook Places emerging we’ve been thinking more about location – helped by a good IAB session on location today.
 
The event put location into perspective – speakers talked about location in the context of search, about how Navteq are embedding marketing messages into their map products – with impressive reach (85% of in car systems use Navteq and their owner Nokia uses them to power Ovi Maps) - and the IAB had done some research looking at consumer thoughts on location, which were largely positive

We see location as the secret ingredient in mobile search; something that will drive a huge change in how brands and retailers promote themselves.

Our favourite theoretical example is Ben Sherman; searching for them on the PC gets you lots of ads for online retailers, and on mobile it’s the same. Yet if I’m searching for them on my mobile I’m probably looking for a stockist – so why isn’t someone telling me where I can buy them around my location?

If Ben Sherman was our client we’d be testing mobile search ads – and using a mobile version of the site - to drive traffic to key retailers. And, learning from our friends in FMCG, using this traffic driving to get better placings in the retailers. All of which drives sales.
 
Google are catering for this with their Blue Dot programme in the US, where they provide a mobile version of their shopping results – but showing local stockists, together with real time information on stock levels and prices.
 
As retailers start to understand the power of location in driving traffic, we’ll start to see smart brands seize the opportunity of mobile search.
 
At the IAB the audience were asked whether Facebook Places was the biggest news in location and most of the crowd – oddly - felt it wasn’t. We disagree - we’re convinced it is a huge step for location, for Facebook and for mobile.
 
Things like Foursquare are great fun, and they are growing quickly but we don’t think civilians are ever going to get that excited by becoming mayor of somewhere – even when brands like Gap offer a 25% discount to anyone who checks in to a Gap store on Foursquare. You start to see the problem for Foursquare when the cream of Londons' digital thinkers are attending this location focused event at the IAB - yet there was only one other person checked in on FourSquare. But when asked who uses Facebook, every hand went up.
 
So Facebook can take the opportunity defined by Foursquare and Gowalla etc - and boom – it’s mass market. This scale then adds a whole new dimension to advertising – for the first time we can target people who we know have been to a particular store.
 
Imagine that Facebook enable this targeting; McDonalds can target a coffee offer to everyone who has checked in at a Starbucks, Pret, Costa etc in the last x days. And they can make sure that anyone who has checked in at the Golden Arches doesn’t see it – no point in cannibalising sales amongst existing customers.
 
Layer onto this the ability to target by location, time and profile – so now the offer is only seen by customers of competitor stores when they are in certain postcodes during offpeak times – and excluding anyone under 20 who might hang around too long in the store. This ability to drive footfall into specific stores is hugely attractive to any retailer - and to brands. Again, consider a FMCG brand who is listed in Tesco but not in Sainsburys - Facebook Places will let them deliver offers only to people who have checked in at Tesco.
 
Location is going to be huge – but the amount of work involved means its an area for experts, and not jack of all trades agencies.
 
We don’t like CTR
 
Clickthrough rates have been the bane of the online world and it looks like we might make the same mistake with mobile.
 
Because the click on a banner could be measured everyone decided the web was all about direct response. But as the novelty wore off – when people realised that clicking on an ad banner was likely to result in a dull experience - people stopped clicking. There is lots of research that shows most people don’t click – and lots of research showing that online ads work even when people don’t click – in fact Comscore research shows online to be just as good as TV!
 (Darren Hermann is trying to get a debate going about clickthrough and the alternative measures of effectiveness– which will be worth following.)

But in mobile we keep seeing people talk up clickthrough –and we’re sure we are going to see the same decline in clicks and we risk the same kickback. Mobile marketing and advertising is about engagement and driving action – and consequently driving revenue. We have to make sure we focus on those success stories, rather than a simplistic measures like clicks.

Finally - we 're off to Brazil next week to keynote for the MMA - so let us know who we should meet in Sao Paulo - or just any cool things to see of do whilst we're there. And our training session for ISBA still has some spaces, so if your brand is a member of ISBA and you want a practical guide to what's happening in mobile, sign up here.


We produce Mobile Fix every week, reflecting the significant news in mobile. The content is also added to the addictive blog, where you can comment. If you'd like to know more about any of these topics or share your thoughts let us know. And please feel free to pass this on to anyone who might be interested - they can sign up for email updates here - or either the email or the RSS feed on the site.

These may be the dog days of summer but there is still lots going on in mobile. So, given we’ve been enjoying the beach in Cornwall rather than writing Mobile Fix, there is a lot to catch up on….
 
Mass Market Mobile
 
With a new report from Ofcom looking at how UK consumers use media we may now have enough data to prove once and for all that Mobile is ready for prime time.
 
The report shows that – as of May 2010  - there are 12.8m people with smartphones – up 71% year on year and 13.5m people claim to have surfed the internet using their mobile phone. Supporting this trend Comscore say 31% of UK mobile owners use apps

So our new focus is not how big mobile is, but how well brands are using it. It still looks pretty tactical from here - but with the evidence that consumers get it, we're starting to see smart marketers recoognise the need for a strategic approach.
 
Location, Location, Location
 
Location based services look like they are going centre stage too, as Facebook announce Places – allowing Facebook users to check in at locations – initially just with their iPhones.
 
At the launch, the current players in this space ( Foursquare, Gowalla and Booyah) were all present and pledged their support – probably something to do with the 500 million potential users that Facebook just handed them.
 
It seems likely Facebook will be the platform for location and people like Foursquare will build services and functionality on top of that. As we’re already seeing developers building interesting new tools that leverage Foursquare we think this is a positive step and that location checkins will become an increasingly important marketing tool – particularly when combined with coupons etc. Shopper Marketing is moving out of stores and away from paper.
 
And when one considers the momentum behind Facebook Credits and how people are using them to drive traffic to Facebook pages and apps, how long before you can earn Credits for checking in at store or restaurant? For most people this will beat earning badges and the opportunity to become Mayor.
 
Whilst we are talking about Facebook, they just announced new tools to make integration with Facebook easier for mobile app developers  - and confirmed they have 150 million active mobile users.

We see location as a core part of mobile and are talking with some clients about this right now - if you'd like some thoughts on how to profit from this area, get in touch.
 
Mobile advertising

Mobile advertising continues to grab headlines as iAds roll out – albeit slowly - with rumours that the Apple love of control is slowing the process down. Despite this, analysts believe that advertising will become Apples next billion dollar business – and there are now rumours that Blackberry makers RIM are about to buy mobile ad network Millenium Media for $500m.
 
Given some data from mobile network Smaato suggests that Blackberry users are least likely to click on mobile ads this may seem odd, but RIM recognise that attracting developers to a platform is key and without the ability to drive ad dollars to those developers they risk losing out on the best service and content apps.
 
The Guardian have some good background on the advertising battle developing between Apple and Google. It’s clear that brands need good advice on how to deal with this divided market but Fast Company points out that there is  a dearth of expertise as the ad industry struggles to deal with mobile – but, hey – that’s what we’re here for.
 
Mobile & Money

Whilst the latest data shows Android is growing phenomenally quickly around the world and in the UK, it’s clear that Apple continue to have lofty ambitions. With Apple hiring an expert in mobile payment we can expect that iPhone 5 will be a step towards the sort of mobile wallet that is the norm in Japan. (Around 35 million Japanese people use the Osaifu-Ketai mobile wallet service)
 
The whole area of mobile and money is fascinating – when the PayPal app means you can give someone money by bumping phones and SMS focused m-Pesa handles around 10% of the Kenya GDP, you know things are changing quickly.
 
Google Speak It
 
The Google focus on mobile continues with new functionality around voice on Android getting a lot of attention. And their desire to drive chrome usage is helped by the ability to switch content between the PC and mobile phone via Chrome.
 
The reason for this focus is hinted at by an analysts report showing that around 10% of all Google queries come from mobile – and that can only grow.
 
Finally...

We've moved into our new home - a really cool space in Clerkenwell - so come and say hello if you are in the area and we're also out and about with an exciting trip coming up to Brazil to do a keynote at the MMA Latin AmericanForum. I'm keen to meet as many people as possible on the trip to learn about this fascinating market, so let me know who I should hook up with.



Apple Advantage
 
As the world waits to see whether Apple are going to recall the iPhone 4 or give away bumpers to solve the antennae issue, we should remind ourselves of some of the advantages Apple have.
 
The fact they develop both software and hardware gives them a significant advantage over their competitors as this article points out.  Vertical integration isn’t that fashionable these days but when you are building innovative devices it makes lots of sense. And their market size means that they get to see everything - everyone from chip makers to screen manufacturers try to sell Apple their best products.
 
And the article also reminds us that the guys in Cupertino are probably already thinking about iPhone 6 – which will be out for the 2012 Olympics.
 
Google gets gaming
 
The huge success of Zynga has opened many peoples eyes to the power of casual gaming and now Google have entered the market with a discrete $100m investment in Zynga
 
There are two key reasons for this deal as we see it. First your enemies enemies are your friends, and whilst calling Zynga and Facebook enemies may be a little strong, it is clear Zynga want to reduce their reliance on Facebook. Google get quite a lot for their money; a chance to push Google Payments (at the expense of Paypal now and Facebook Credits in the future) and some addictive content to anchor their play in social.  If you can get people to keep coming back to play games, you have  a chance to get them to migrate some of their social time there too.
 
Whilst we are talking of Facebook Credits you should read this piece by Ian Schafer ( of hot NY agency Deep Focus) which looks into the power of this new global currency.
 
 
Facebook have started talking about their mobile strategy
 
Their new head of mobile, Eric Tseng (formerly of Google), talked about providing mobile developers with all the goodness of the open graph and also said
 
“Where we’re going from here is a platform strategy. We’re going away from a one-off app strategy,”
 
So it sounds like we’ll soon be able to incorporate most if not all of the Facebook connect into the apps we architect and build. In this video Eric describes how things like location and recommendation can be combined.

This piece looks at how Facebook is progressing in some key markets – looking in particular at Japan and India
 
 
Making apps gets a little easier
 
One aspect of the new mobile world that intrigues us is how people complain about the cost of developing mobile – especially when smart people now go cross platform rather than just do iPhone. We’ve pointed out before that development costs are a fraction of what they were a decade ago. Google have helped this argument with a new tool that lets anyone build an android app. As soon as it is opened up we’ll have a play and report back

Advertising
 
With all the hype about iAds ( such as this Unilever one spotted in the wild) its worth remembering that other people are innovating around advertising too. This article looks at other mobile ad products/formats from people like Crisp, Greystripe and Medialets whilst this one looks at how Facebook are developing their ad offering.
 
Finally

There is more data showing that the consumer demand in the US for smartphones is still ramping up – and that Apple and HTC look like being the main beneficiaries.
 
And Neilsen data shows that many smartphone users there hardly use data, but there are a small proportion who consume huge amount
 

We produce Mobile Fix every week, reflecting the significant news in mobile.  If you'd like to know more about any of these topics or share your thoughts let us know. And please feel free to pass this on to anyone who might be interested - they can sign up for email updates here - or either the email or the RSS feed in the right hand column.

Clickz spotted this Unilever Dove iAd and a Nissan one too

Has Apple peaked?

Like many, we’ve probably over focused on the iPhone when talking about mobile. For all the right reasons though; most of the momentum around mobile and smartphones is because Apple have launched a series of hugely innovative products. These have raised customer expectations around what they can do with mobile – and consequently drove the rest of the industry to respond.

But with the continuing grumblings around the iPhone4 and Apples apparent desire to create a walled garden, we have to ask whether Apple can continue to dominate the market, or is mobile now mature enough that other players will share the responsibility of driving the market forward? Consider some stories from this week;

Danish Telecoms analysts Strand point out that the iPhone 4 does little for anyone other than Apple, as most early buyers are replacing old iPhones.

Nokia have refocused on smartphones with one of their top people leading a new charge;announcing the Fightback Starts Here – he says he is obsessed with getting Nokia back to number 1

This amusing video around the iPhone4 obsession has got 3.5 million views.

The new best android phone ( the Droid 2 ) is getting really good reviews

The developer base of Android is now reported to be bigger than that for Apple – and Hentry Blodget suggests that Apple is repeating old mistakes.

And now everyone has an iPhone (and you can buy them in Tesco) is the early adopter crowd looking for something new to show off?

Don’t get me wrong – I love my iPhone (still a 3GS) and my iPad . And my MacBook Pro.  But showing people a Nexus now gets a lot more attention. And the Evo and Droid will too.

The defining platform for any project we do continues to be the Apple OS – but we now wouldn’t advise anyone to do iPhone only – it’s crazy not to include Android too. And the case for extending to Blackberry and other platforms gets stronger and stronger – depending on the target audience. And having a version that works in the mobile browser is increasingly a mandatory too.

But to give credit to Apple, their success in Japan has led dominant mobile operator DoCoMo to change its policy on apps to emulate the Apple App Store approach. This is the mobile equivalent of selling ice to eskimos.

Our take is that we’re getting to a mature mobile ecology, where Apple is just one of the key players.

Which means mobile strategy has now to be a little more than “lets build you an iphone app”. Identifying which platforms are right for your brand and which approach will drive the best ROI requires smart thinking – from people who can architect a mobile campaign rather than just build it.

You Tube – Browser vs App

Google are now pushing the browser based version of YouTube as the preferable alternative to the YouTube app – which Apple “control”. YouTube claims to be serving 100m videos a day through mobile and they want to monetise that – without needing Apple approval. 

As well as making good business sense, this move reinforces the Google view that content and services can be just as compelling in the browser as they are in apps. Google want – and need – the mobile world to be (HTML5) browser based, as that plays to their strength in advertising.

And their innovation continues with YouTube lean back – effectively a You Tube channel where you watch continuous videos – selected based on your profile. How long before some TV station starts running this?

Google vs Facebook

As analysts reduce the target stock price for  Google – largely reflecting the impact of exiting China - Google need to find strong new areas for advertising. And as social continues to grow Google are rumoured to be making yet another attempt to be a player in social with Google Me.

Facebook continues to grow quickly though and is making good progress, even in markets where there are long established competitors – like Germany and India. And they are catching Google's Orkut in those markets where it took off.

Are Yahoo back?

They never went away – despite the poor press, they continue to attract huge numbers of visitors and the new regime is getting the platform in shape to compete.           

They are looking for collaborations in the mobile space, which makes lots of sense; Android apps for their still very popular mail and messenger services launched last week. And their recent partnership with Nokia dramatically extends the reach of these services.

Yahoo are also courting developers and with their reach they are a very interesting platform choice - this John Battelle piece goes into more detail and is well worth reading.

Location layers

Location continues to get lots of attention – with new data showing Foursquare much bigger than Gowalla but both growing very quickly.

And the new ways of using location are emerging. This week saw Foursquare launch layers, where users can choose to see tips from partners like Huffington Post and Independent Film Channel, focused on their location.  This is an interesting build on projects like the very cool Yellow Arrow where people tagged the real world.

We pitched a similar idea to Channel 4 last year, which unfortunately didn’t get commissioned, but there is a great opportunity for brands to drive this forward.

New data on US mobile usage

40% of adults use the internet, email or instant messaging on a mobile phone (up from the 32% of Americans who did this in 2009)
 
Lots more good stats from a Pew report to reassure us all that mobile really is ready for prime time.

Mobile – Toy or Tool?

"I believe that the very best engineering is now going on the mobile devices — the hardest problems and the most clever solutions," Eric Schmidt

Knowing that Google see smartphones as the future no longer seems like news.

When GFK tell us that people download 15 apps on average and that most people are willing to pay up for the right app, it just feels like confirmation of what we know. 

And when the Economist point out that apps are not quite the get rich scheme some people thought, again it seems like common sense 

It feels like the bubble perhaps isn’t a bubble at all – that mobile is growing up and being seen as a tool, rather than a toy. 

Disney have bought iPhone app studio Tapulous showing that the big entertainment companies see mobile as a key platform. Now gaming might look like mobile as a toy but Disney know that to maximize the value of their various franchises, they need to be a big player on what is emerging as one of the top platforms for gaming – mobile

Ebay have bought barcode scanning company Red Laser as a way of extending their reach further into mobile. Now eBay expect to see $1.5bn revenue from Mobile thus year – more than double the $600 million taken last year – and linking their inventory with the real world through scanning sounds like a good move.

Tesco demonstrate the potential of scanning with their very smart shopping list app. Using a scanner to add items to your shopping list makes it easy – then Tesco reorder your list depending on the store you are visiting - so your list matches the the way the aisles are laid out in that store. Speeding up your trip around the supermarket solves a consumer problem – how do get I my shopping done as quickly as possible – and a business problem – how do we get people in and out of the store as quickly as possible – whilst still maximising basket size.

But we see the (probable) next stage as the big win for Tesco. P&G talk about instore as the first moment of truth – and most FMCG brands are happy to give margin away ( through a coupon or offer) at this point to make sure they get the sale. So imagine if Tesco go to Unilever and ask them if they would like to serve a Sunslik coupon to someone with (P&Gs) Pantene on their shopping list – right at the moment they are stood in the shampoo aisle.

Mobile - done properly - is a tool, not a toy.

iPhone growing share

With the iPhone 4 launch a huge success – despite it needing to be held the right way - we’re not too surprised to see Comscore data putting iPhone at 18% of European smartphone market – with Nokia as the main loser

Android growth continues to be impressive, but one issue that is felt to be limiting take up is the way different handset manufacturers use the operating system. Google seem to have watched just how the control freak approach has served Apple well and their next iteration (Gingerbread) requires that handsets must meet strict hardware requirements to be able to use it. With certain screen sizes stipulated, the consequent standardisation will be good for developers and better for users as switching to a new phone won’t require too much ‘retraining’ as Gingerbread will also reduce the opportunity for custom interfaces like Motoblur. And to see how well people are using Android right now, take a look at the Motorola Droid, which promises to be the next hot phone. 

Gingerbread phones are likely to be available in October - around same time as Windows 7 comes to market. Given the early death of the Microsoft Kin – withdrawn in the US after selling just 500 units – Microsoft have to make Windows 7 a success.

Some quick reads

Location continues to get attention – with Foursquare getting $20m in funding, Mashable takes a look at Twitter Places.

A good deck on HTML 5 deck – with a neat demonstration of what can be done with the browser

More background on the company behind siri

We produce Mobile Fix every week, reflecting the significant news in mobile. The content is also added to the addictive blog, where you can comment. If you'd like to know more about any of these topics or share your thoughts let us know. And please feel free to pass this on to anyone who might be interested - they can sign up for email updates here - or either the email or the RSS feed on the site.

iPhone 4

Yesterday saw the new iPhone launched with queues everywhere as people waited in line. But with the white version delayed and the new OS available for free for 3Gs iPhones we might wait.

The reviews of the new phone have been good ( some very good) but there is an emerging story that might turn out to  significant; some people report that when holding the phone touching the antennae on both sides, the signal drops and calls fail. Apple have now acknowledged this hardware fault – this could turn out to be a real problem – too  early to really tell yet. We though the prediction that Apple stock would plunge to $40 ( from around $275) was a joke – but you never know…..

US teens get SMS

Very interesting new research from Pew shows that US teens are (finally) emulating their peers around the world and using SMS as their key communication method. The research shows that around a third of US teens send 100 text messages each day – echoing data we have seen on Korea, Japan and Europe. This is quite remarkable as SMS was hardly used in the US until American Idol taught everyone there how to text.

This research is worth a read as it underlines the potential of SMS as a tool for modern mobile marketing; whilst smartphones are creating a new model for mobile, there is still huge potential in SMS with its virtually universal reach. Twitter has demonstrated that you can say a lot in 140 characters, so the 160 of SMS is more than enough – and as new tools to blend the web with SMS emerge – like Twilio – very interesting possibilities arise. New York VC Fred Wilson – and investor in Twilio – has some interesting thoughts on this area.

We’re looking back at work around chatterbots on Instant Messenger for learnings – the way people would interact with databases through artificial intelligence ‘reading’ IM messages can be easily applied to SMS.

Yet most use of SMS for marketing disappoints; few brands are seeing that SMS is a core element of what we term dialogue marketing. This is where brands build a real dialogue with customers, understanding whether they are strangers or acquaintances, friends or family. As the dialogue builds it makes the brand more valuable to each customer, and each customer more valuable to the brand.

Future of retail

The smart people at PSFK have produced a great report looking at innovation in retail. As well as some of the mobile opportunities we have mentioned here before they have lots of other great examples. We are great believers in the value of brand cathedrals, so this is well worth a read. And the guys are in London next week to present the report – should be a really good session.

Future of mobile

We still use Siri as an example of where mobile is going so were interested in this quote from a Guardian article on how voice is a big focus for both Google and Apple (which oddly neglects to mention all the good stuff Google is doing around voice)

Apple paid between $150m and $250m for Siri, an innocuous iPhone application that is a voice-controlled personal organiser. SRI International, the company that developed the app, had roots going back to 1946 exploring various human/computer interfaces, including the mouse. It received $150m from US military to create an organisational tool for troops. And we know that the military always has the best technology, first.

If you don’t know about Siri yet, be sure to check out this video demo

Interesting reading

We’re loving the cool new service from paper.li, which creates a daily paper from all the links shared by the smart people you follow on Twitter. It makes it easier to get real value from Twitter.

This is the addictive one – you can subscribe to this or create your own.

 iAds

As we know some big advertisers have put  a lot of money into the new Apple ad format iAds. But understanding what has been bought is not that clear.

The $60m committed for the second half of the year will represent a huge proportion of the overall US mobile market - maybe as much as 50%. But when asked about how the charges work people at Apple and Quattro (the mobile media sales operation recently bought by Apple) are unwilling to talk. As an Ogilvy mobile event I spoke at today we saw a little of the theatre that Apple specialise in; the agenda listed a surprise speaker and we were told that during this surprise session the live stream of the session would be turned off and we were asked not to tweet.

The surprise turned out to be our friend Todd Tran of Quattro, who then gave a presentation about Quattro and showed a clip of the recent Steve Jobs presentation where he demonstrated iAds. So nothing new - a segment of the Jobs presentation has been on the addictive blog since last week - and no details on costs.

Watching the video we see that iAds do look good - but essentially the format is really familiar; a banner at the bottom of the page can be clicked on to open a microsite - usually with a video streamed first, then a page with various chances to interact. The new element is that all of this is contained within the app, rather than requiring the user to leave the app to go to the microsite.

Built with HTML5, the demos shown demonstrate the opportunities for mobile - and, as you would expect, Apple are packaging this beautifully. But if rumours are true - and I suspect they are - Apple have a charging model which takes two bites of the cherry. The Wall Street Journal say;

Apple is planning to charge advertisers a penny each time a consumer sees a banner ad, ad executives say. When a user taps on the banner and the ad pops up, Apple will charge $2. Under large ad buys, such as the $1 million package, costs would rack up to reach $1 million with the various views and taps.

Right now the advertiser would pay for either the banner impression OR the click to visit the microsite. Apple appear to intend to charge for both.

We have to say Apple have done a great job of getting brands interested in  mobile - but if brands don't get a good response there is a danger they decide that mobile is expensive and doesn't work - even though they have only dabbled in one platform. There is plenty of innovation around creative formats and charging models across a much wider mobile market and we believe smart brands should work with smart media people - who really get mobile - to build plans which reach users of all smartphones.

iPad ads work

A case study of advertising in the iPad suggests that mobile advertising does work -  high levels of interaction and dwell times.

Mobile search

A new study in the US suggests that mobile searches now account for 9% of all queries and are forecast to grow to 20% by 2012. But revenue is lagging - with mobile revenues running at around 2% - but the research suggests the gap will close and that mobile search could be worth between $2bn and $3bn by 2012.

The data also shows that smartphone usage is a huge factor in mobile searches, so the rapid adoption of smartphones will accelerate this trend.

Our work with clients typically shows that smartphones account for a growing proportion of site traffic - both organic and search driven. And we see that many clients have yet to optimise their search activity to reflect the effect of mobile - so it's well worth doing this quick check;

1/ How much of the traffic to your site comes through iPhones and other smartphones? ( most site analytics tools can now identify iPhone traffic if not other mobile devices)
2/ What does the site look like when viewed on a smartphone? Does it work?
3/ Is mobile turned off or on within your paid search activity?

We usually find that the cost of building mobile specific landing pages can be funded through the value lost through not optimising search; either by eliminating the waste of mobile search going to a non optimised page or through the additional volume available through adding mobile search. If you'd like a point of view on how you can unlock the value of mobile search, let us know.
 
Finally we were delighted to be asked to join the Ogilvy Mobile day in London yesterday, where we spoke about mobile, loyalty and advocacy. This is the deck we shared;

Mobile, Loyalty & Advocacy

View more presentations from addictive.