So later today we’ll find out how much Facebook is worth. And all the signs suggest the figure will be north of $100bn – meaning people are paying 103 times this years revenues. Given the Google flotation valued them on the first day at 69 times their revenues, this is pretty bullish.

Henry Blodget of Business Insider knows a bit about tech IPOs and his headline says it all;
Facebook Insiders Pounce On IPO Frenzy — Now Dumping 85 Million More Shares On Muppets

The hype was dented a little this week when the decision of General Motors to pull their $10m spend on Facebook, made lots of headline. Oddly the quotes from Ford etc saying they remained committed to Facebook didn’t get the same prominence.

As a smart friend, from a WPP media agency, tweeted – GM are just doing it wrong.

But the ad industry skeptics are out in force and if they are right, then the float really is muppet bait. GigaOM point out that, right now, Facebook is essentially a media company but there are other revenue models open to them.

Facebook have the opportunity to redefine how advertising works  – and if they can do that whilst making the transition to a mobile company, there is a really lucrative future. Noah Bryer sums this up well – they have to find a way to create intent. And this is more positive thinking about the way Facebook can quickly monetise mobile – more sponsored stories, innovate around location and offers and enable device specific targeting.

Given that around 2/3rds of active internet users are using Facebook the sheer size of the opportunity means you’d be foolish to bet against them finding ways to make money.

Our take is that we wouldn’t invest money in buying shares. But we would invest money is buying ads on the platform. Done properly they do work – and are a smart way to amplify the content created on fan pages.

(This is some smart thinking on how to value a Facebook fan and this Forrester report on Facebook and marketing is worth reading too)

NewTV

Last Saturday saw the first Shazamable ads in the UK in Britains Got Talent from Pepsi and Cadbury. Reports suggest 50,000 people interacted with the ads which seems a good start for this 2screen tool. We were interested to see well connected media journalist Kate Bulkley tweet;
but i hear only 400 people used zeebox 4 BGT

Could it be that 2Screen needs the broadcaster to prompt/remind people to interact? Which makes us wonder if/when ITV and C4 will jump into the space with a proprietary 2Screen service.

This interview with Shazams commercial powerhouse is worth a read as is this summary of how brands are experimenting with 2screen. Smart brands are really focused on how 2screen can work – as this quote from Pepsi suggests;

In the future, no television advertisement will be just self-contained narratives designed to entertain, inform, educate or remind consumers about products. …. They will be trailers into deeper branded digital experiences.

We agree – we’re very focused on this opportunity right now.

Google Knowledge Graph

Whilst all the attention is on Facebook, Google have been busy. This week they have launched a major initiative around search called Knowledge Graph where they seek to match searches to concepts or entities rather than just pages that match the search query. As search expert Danny Sullivan explains, this is a big step forward in search.

It’s rolling out in the US first so we haven’t played with it yet – but, of course, it works on mobile too.

Other Google news this week is an update of the data on Our Mobile Planet, the excellent research source that Google launched last year and new content around the Zero Moment of Truth, the Google look at how retail works.

The other big news is the new mobile version of Google+ - where they have created a really compelling service – much preferable to the desktop version. Even if you have given up on Google+ we think this is well worth trying.

eBay

eBay have released new research suggesting retailers could boost revenues by £2.4bn through adopting new technologies like mobile and connected TV. Following their push for better connectivity, eBay is very focused on a mobile agenda. One of their key people has written a good article for the Guardian on the need for a mobile strategy.

And they continue to innovate with mobile tools – the latest version of their fashion app enables users to take a photo of a colour or pattern and search for clothes that match on eBay.

The data derived from shopping etc is one of the key assets that PayPal has in mobile money.

Quick reads

Whilst we wait to see what Richard Branson will do with Square and Northern Rock, iZettle (the Swedish Square) is launching in the UK.

Pinterest is now valued at $1bn – with most of the investment coming from a Japanese ecommerce business – supporting our view that Pinterest is a getting to be really important as inspiration for shopping.

The huge growth in reading magazines on the mobile isn’t turning out to be that lucrative – many people are TIVOing their reading by saving articles in Evernote etc to read later.  Which would be fine, if these reader tools didn’t tend to strip out all the ads.

We had to miss the IAB Mobile event yesterday but heard good reports – especially of the Twitter deck on Mobile & Social from Bruce Daisley. Great examples of how advertising is being reinvented in social and mobile.

Finally – we’re hiring. We’re looking for a really smart account manager who loves mobile and gets social. And we have a paid intern role over the summer. Both people need to be practising what they preach, so having an active twitter feed etc is key. If you know anyone suitable, point them our way.

Silicon Valley soccer?

Premier League is one of the most valuable global sports franchises and, whilst its glamour is diminished by the continued absence of Leeds United, the next auction of TV rights will be lucrative. As we talked about recently, the success of Sky is/was  based on their acquisition of the Premier League rights back in the 90s.

Given that the Premier League have designed the new packages in such a way as to make them attractive to Google and Apple, we wonder whether this could be a big step forward for newTV. As the rights are being sold on a technology neutral basis, the winners can exploit the rights on any device. So as well as taking mobile sports to the next level, the winner could use them to kick start Google TV or Apple TV.

For anyone to justify the costs of these rights they’ll use them across traditional TV and digital channels. By 2013, when these rights come into play, smart TVs are likely to be a significant sector of the market – along with TV apps. So Google or Apple will be able to reach TV audiences through apps as well as their much anticipated dedicated TV services.

One obvious vehicle for the football is YouTube, where Google are investing $200m in marketing support for their new channel focused approach. Looking at how they present the channel opportunity for advertisers shows just how far YouTube has come. And their new YouTube playbook for advertisers is a good source of inspiration on how to use video online

Future of Advertising

Our polemic on the future of advertising last week got some good reaction and we see this debate happening in quite a few places.

Jeff Dachis – who’s first digital agency Razorfish was one of our key competitors when we were running Modem Media/Poppe Tyson in the 90s – now runs Dachis Group, one of the smartest social media “agencies”. Talking about Facebook, APIs and big data he had this to say about social in general;

Previously, brands could either get scale (e.g. buy a Super Bowl ad) or deep engagement (i.e. street teams and events).  I believe social represents the key to brand marketers achieving engagement at scale.

And a Nike marketer said this;

“A whole industry is stuck on trying to force old metrics on to new channels”

“once you have established a direct relationship with a consumer, you don’t need to advertise to them”

But traditional agencies still seem unsure about Facebook. Just like when you have a hammer everything looks like a nail, when you’re all about advertising you want everything to look like an ad – ie a box or rectangle where you can put your message. Having said that the FT reports that premium ad prices on Facebook are still rising so it’s working for somebody.

John Battelle has written a typically thoughtful piece on why we need advertising to work online – otherwise the content creation that drives the majority of the eyeballs could cease. He doesn’t have the answer though – I think that’s our challenge.

Facebook App store

One key theme for Facebook is driving HTML5 and – counter intuitively – the open web. They don’t want Apple and Google to dominate mobile and worry that if their walled gardens prosper, the Facebook walled garden may not. This summary of the Silicon Valleys war for the mobile web is a good summary of the current positions.

A big step forward is the announcement of a Facebook appstore. With support for paid apps and in app purchases we expect to see more developers invest time and effort in getting prominence here. Whilst people will still go to the Apple appstore or Google Play to install the apps, the opportunity for discovery will make it valuable.

Given the size of the Facebook user base this will be an essential for any developers – and as they will support webapps too it could herald a major change in the mobile ecosystem. This picture from a presentation by Facebook mobile guru James Pearce shows the size of the opportunity; mobile web traffic is bigger than iOS and Android combined.

One thought is that  – given the opportunity to activate people who have liked your brand on Facebook – this move could give a new leash of life to brand apps. So long as they are good (useful and/or entertaining) brand apps.

Mobile Stats

We’re less interested in stats these days as we think everyone has read the memo – mobile is mass market now. So hearing that mobile is now 10% of the total internet usage seems impressive but not really news. There are lots of stats in a new report from Chetan Sharma, coupled with some smart thinking on why mobile is so important;

Having the best knowledge about the user to help drive the transaction is simple the most valuable currency of commerce

This deck will be plundered by everyone doing a mobile trends deck – especially those agencies whose mobile expertise is one man and a dog eared Mary Meeker deck.

Operators launching apps

Along with many others we’ve been critical of operators not investing in mobile content and services for their customers and leaving it to GAFA to take all the new value being created.

We’re delighted to see that some operators are fighting back – leveraging their huge customer base and technology advantage to come up with interesting services. As well as the action around wallets, Telefonica have launched a messaging app to counter whatsapp etc. Given the impact on their revenues (operators lost $14bn in revenue in 2011)  as SMS volume shrinks due to people instant messaging, this is a no brainer.

The Orange 2screen TV app is a little more left field, but also interesting. Whilst Skype and Zeebox have got an early advantage in this space we expect lots more entrants – so why shouldn’t an operator play? We haven’t had chance to use the service yet but the technology is interesting as it uses visual to synchronise rather than audio used by Shazam and others.

One big advantage they have is the ability to pre install on customers new phones – at least on Android – so we expect to see that tactic come back into fashion.

More Mobile Money

Mastercard have announced their play in mobile money – PayPass isn’t that different from other initiatives but they are pushing it as an open platform – so any card can be added to the wallet. Its also white label so other people can launch their own product using this platform.

A US VC has written a good summary of the current state – suggesting that Apple are happy to use wallets to help sell more devices and that Google are happy to use the transactional data to help target advertising. Whilst we agree that both those outcomes are very important, we don’t think that any of GAFA will pass up the chance to take a share of payments they facilitate.

Quick Reads

Some of tbe publishers who rushed into apps are having a rethink. This piece from MITs Technology Review is a good look at how the economics of apps don’t add up for some – and the FT switch to HTML5 looks like becoming a trend.

There has been some comment that Zynga buying DrawSomething looks like a bad deal, as the popularity of the game wanes. Techcrunch has a good look at the deal and decides it did make sense.

The Economist has a good article on the Internet of Things

Building on the idea of mobile enabling lots of devices we loved this Japanese integration of iPhone with toys.

The Head of Digital at the BBC wants to “make 2012 for digital what the Coronation was for TV.”

US retailer Target has decided it doesn’t want to encourage Showrooming and is stopping selling the Amazon Kindle. We wonder if Tesco well ever follow suit?

We’re enjoying the Eric Ries book The Lean StartUp and this is a good piece on one of the key elements – The Pivot

Finally we still have a couple of desks going spare, so if you know anyone looking for space do let us know

We are seeing some interesting examples of new advertising models working. Zynga have come up with a genius way of monetising their $200m buy DrawSomething; getting people to draw brands. Smart Car used twitter in a really clever way in Argentina - once the page is open hold down the J key. P&G are supporting their Olympics presence with a fantastic TV ad – except it’s not on TV (yet?). With around 3 millions views and lots of social buzz the 2 minute film looks like a modern way to do marketing. They have over half a millon likes on Facebook, so should be able to build a profitable dialogue with those fans. And with the film proven to work they should now invest in TV to build the audience. Or should they spend the money with Facebook to get the film seen? The right answer is probably both, but the client is seeing that good content can earn good audiences for free. Is the value of someone choosing to view that film, worth more than someone seeing it in the middle of a TV show? And there are some other good examples of modern digital advertising here.

If we can prove that Facebook ads can and do convey brand messages, there is a big future. But if we find that the current ‘quiet’ ad formats on Facebook don’t work hard, then there is a big question mark, as ‘louder’ ad formats could drive users away.

And old school agencies should be concerned  - clients are working with a whole set of specialists who really get Facebook and they are getting lots of investment. Could these specialists threaten the role of traditional agencies?

QR Codes work shock

Whilst people who really should know better keep on about NFC that much maligned mobile tactic of QR codes is working for some people.  Like anything else QR codes can be used badly or used well – and we love the idea of a sundial QR code and the Guinness glass is pretty cool too.

Some smart thinking on how apps will be replaced with Smart Mobile Services

Finally 
Everything Everywhere report that 70% of their contract customers are now on smartphones and that 90% of new customers choose a smartphone. One of things we’ve been talking about in client workshops is just how fast the mobile ecology is changing. Right now we can see the effect on every industry. But consider this; by the end of the year we’ll have the iPhone 5 and the next generation of Android from Google and Motorola. (There is a fair chance we’ll have the iPad 4 too) After the Olympics we’ll have virtually ubiquitous wifi in London ( including the tube) and 4G will have been launched. Plus there is all the innovation from GAFA and the multitude of startups in m-commerce and mobile money etc.

Apple makes money shock

Whilst Apple making money doesn’t seem very newsworthy anymore the latest results are worth a mention. The share price had dipped (13%) and some wondered if the amazing ride was over – a stock up 70% in four months has to take a fall sometime doesn’t it?. Well not when you report an 88% increase in iPhone sales. As these charts from  Business Insider point out the iPhone alone is now a $100bn business after just 5 years; as @SaulKlein tweeted that’s what you call a start up.

But can it last for ever? Will the hit products keep coming? Could the patent wars dent their amazing profitability?. There is a view that Samsung – now the biggest phone manufacturer by volume – has more and better patents and can put a lot of pressure on Apple

“Samsung is way ahead of the curve, with about 50 percent more patents than its nearest rival,” Mr. Kumar said. “And Apple will have to license a lot of 4G technology.”

Amazon disrupting publishing shock

The debate around how publishing is polarizing. Some see digital as way to break up the power of the big publishers and other see Amazon, Apple and Google as new gatekeepers destroying the market.

Jeff Bezos is clear that he is against the old gatekeepers.

As ever Seth Godin gets to the heart of the issue; Piracy? You Wish.

A key argument against Amazon is that they use books as a loss leader to get people to their other businesses. Which keep expanding. This week they launched a flash sales sale called My Habit.

And to strengthen one of their promotions/deals plays, they are leveraging their unrivalled expertise in collaborative filtering to create profiles for users of Amazon Local. This will allow users to like or dislike the deals they are offered, so improving the ability to target deals – which is actually little different from what Groupon or Google offer. But in the future they could use your Amazon purchases to drive recommendations – they are keeping schtumm about that possibility for now.

Targeting is the key bit of friction in this space. Everyone seems to have stories about how inappropriate the Groupon deals are for them. At an excellent Mobile Marketing Association breakfast yesterday Groupon made a rare public presentation on their business, and talked about their GrouponNow mobile service which they hope will improve targeting as it moves the model from push to pull. We were interested to hear that mobile accounts for 10% of Groupon sales by value – which would be around $400 million. They previously reported that 25% of December sales were on mobile.

Interestingly Amazons other promotion business Living Social has pulled out of their equivalent to GrouponNow, closing its Instant mobile deals business. One reason is thought to have been the hardware costs – they gave iPads to many of their merchants.

Mobile Money everywhere

We attended an interesting event for SimplyTap this week, the retailer driven mobile payments service that Visa recently invested in. With a good turn out of retail heavyweights (it’s a long time since we were in a room with so many people with partings in their hair) we heard some bullish predictions. Stuart Rose – formerly of M&S – is their chairman and had some smart insights into how retail needs this innovation.  This approach echoes what’s happening with retailers in the US, where people like Walmart and Target are looking to play a major role in mobile wallets.

With Visa predicting that half their business will be mobile by 2020, lots of people want to play in this space and this week also saw O2 launch their mobile wallet. Something of a Swiss Army Penknife service, this app has a mobile wallet, the ability to send money by text (like Barclays PingIt which we mentioned last week) and a barcode scanner so they can compare prices.

Sky News have leapt off the fence to say categorically that it won’t work, as banking is not in O2s DNA but we think they have a chance. This service is less about banking and more about payments, and around the world we see numerous examples of operators having success – but it’s going to be a while before you can call anyone a winner.

And as we keep saying, the payment is not going to be the key thing in mobile money. No-one has a problem paying for stuff and for anyone to be successful they need to create a context for the payment – where they solve a problem for people and then facilitate the payment to complete the process.

Square get this. They enable anyone to take credit card payments – expanding the number of US merchant accounts by 1 million since launch. They enable the merchant to create a dialogue with their customers – including offers – and then enable the payment without needing the credit card to be swiped after the first transaction. And they are doing amazing business – estimated to have a run rate of $5 billion a year in revenue.

We think that the winner in mobile wallets will also be the winner in promotions, deals and offers – if you are doing one you would mad not to do the other. Not least because the visibility of what people buy can drive better targeted offers – which is another advantage the credit card firms have. Just as Visa are investing in people like Simply Tap and Square, we wonder how long it will be before they buy a stake in a deals business?

When asked about payments and NFC at the MMA event the Groupon guy said he thought that it was an old technology and it would be newer tech like Square that would win out. They also mentioned their strategic alliances with Nokia, Deutsche Telecom and Foursquare – how long before they partner with a payments player?

And one last bit of retail news – Walmart have launched a new service that allows online shoppers to pay with cash. The customer buys online, then goes into a walnart store to pay, then the product is delivered to them.

As store traffic is so vital to high street retailers, we can see this type of multi platform retail growing – we also heard that some high street stores are looking at handling ecommerce returns for other brands, in order to get the traffic into their stores. Smart retailers are looking to connect their various channels and mobile can be the connection.

The real Pope of the Internet

Is Marc Andreessen the smartest man in tech? Well he did invent the browser and went on to launch Netscape  - the first internet IPO. He came up with the idea of cloud computing before anyone else. And he was very early into social – launching Ning in 2004 enabling people to build their own social networks.

Oh, he also invested in Skype, Twitter, Groupon, Instagram and AirBnB.

This Wired Interview with him is fascinating – especially his theory that technology wants to be free; where he feels that -when the connectivity is good enough – the processing should take place in the cloud rather than on the device. Which means the web model works better than the native app model – but we need the connectivity to catch up.

Looking at how the cloud works today, means looking at Amazon web services, and this interview with the CTO captures the huge opportunities of the cloud and networked services.

And on the webapps versus native tip, Scott Jenson of Frog thinks native apps are over. Given his experience working at Apple, Symbian and Google, his thinking carries some weight. He does accept that it’s going to take some time though. Well worth reading.

Quick reads

Is Facebook really worth $100bn? – this piece questions some of the thinking behind this assumption.

TNS have updated the data in their Mobile Life survey and its worth a look.

Google are building on their efforts to get brands to invest in mobile and have now launched the Mobile Playbook – lots of examples of brands getting Mobile right.

McKinsey have taken a look at how businesses are handling social  – and produced some good advice.

Nokia financial performance is worrying people and the Guardian focus on three key issues. And their credit rating has been downgraded to Junk – the same as Greece.

And they’re back. The rumours that Facebook is to produce a smartphone have surfaced again – this time with HTC as the partner.

Last week we talked about our theory that much of mobile is a hits business – whether it’s the latest device or the coolest app there is an element of fashion – and constantly making hits is hard. New York VC Fred Wilson posted on the same subject this week and asks if apps are like TV shows. A good read.

Rory Sutherland is probably the smartest guy I have ever worked with, and this interview is a good take on his current thinking about how human behaviour can be used to drive innovation

Finally

In the last couple of week we have done interesting workshops with smart agencies looking at the mobile opportunity. If you think this would be useful for your agency or brand team, lets have a chat.

And we have a couple of desks spare in our very cool office, right in the heart of Clerkenwell. So if you know any 1 or 2 (wo)man bands looking for space, point them our way.

Mobile Money

The pace of change in mobile money is unrelenting. The Barclays PingIt app now lets anyone (Barclays customer or not) download the app and create a PingIt wallet, then pay anyone up to £300 by using their mobile number. The recipient gets a text and, if they are not using Pingit gets asked to register.

It’s a good service and the built in ‘virality’ means Barclays could do really well with this.  We know from our time working on HBOS that getting people to switch banks is really hard – people are more likely to divorce than change their main bank account. This could be a great customer acquisition tool for Barclays and reinforces our view that smart use of mobile can deliver real competitive advantage.

Unfortunately BarclayCards mobile innovation isn’t as well thought through. In an attempt to accelerate the use of NFC, Barclaycard have launched PayTag, promising toturn your mobile into a new contactless way to pay. Which sounds great until you realise it’s just a slightly smaller credit card (containing a NFC chip) that you stick onto your phone. Or anything else you want to stick it onto.

We’re always pushing innovation and plan to use the card to create Umbrella Commerce. Just wave your umbrella over the McDonalds contactless reader and you can pay for your Big Mac with your brolly.

It’s rather pointless and is very similar to a US business called Bling that closed down a couple of years back. It supports our view that NFC may never take off. We heard this week that a McDonalds employee says more people attempt to pay with fake £50 notes than pay with a contactless card.

There is smart thinking going on around mobile payments and in their latest results presentation eBay CEO John Donahue talks of PayPal defining the future of money with their new initiatives. These include their version of Square and testing a service at Home Depot where people can pay with PayPal by giving the cashier their mobile phone number and a pin code.

But consumers are still concerned over security of mobile money and all the players need to work hard to correct this misconception. One of the advantages of the Project Oscar from the mobile operators was that their trusted brands (O2, Vodafone and Everything Everywhere) would help mobile money take off. But the initiative seems to be running into problems with the European Union.

One of the things driving mobile money is that cash is an expensive business to handle. The Canadians are about to stop making pennies as it cost 1.6 cents to make each one cent coin. And they are asking tech companies to help them create a mobile alternative.

Mobile disrupting the Content business

There is no part of the content industry that isn’t thinking about whether mobile will continue the corroding effect of digital or whether it offers some light at the end of the tunnel. At the London Book Fair this week there was lots of talk about digital and mobile, but the digital zone was only 5%.

The news that Amazon now control all distribution rights for all the James Bond bookscame too late for the event, but there is no better indication of how the world is changing. We haven’t seen any pictures of Jeff Bezos stroking a white cat yet, but it can’t be long.

Whilst Amazon says they will make the paperbacks available to all retailers the only digital editions will be for the Kindle. And there is some resistance to Amazon acting as a publisher, with Barnes & Noble refusing to sell their books.

For the owners of the rights this is probably a great deal, but are we moving towards a world where GAFA balkanise content? Imagine if Apple bought the rights to Motown or the Beatles back catalogue and said that the only way to buy that music was through iTunes. Unlikely right now but how long before it makes sense?

If you can pay $200 milllion for a game how much is a content franchise worth? We have seen the power of exclusivity in TV – Sky built their business around exclusive deals with sports franchises.

TV & Mobile 

As Shazam agree that ITV can be their exclusive sales partner in the UK, the connection between TV and mobile gets ever stronger. A new survey in the US suggests that the combination of the two media is stronger than either alone.

Probably the best 2screen experience so far is this Shazam enabled promotion from Red Bull.

Measuring mobile & digital for brands

As mobile becomes the connective tissue or glue holding smart brands marketing together – and making the whole more powerful than the parts, getting better measurement metrics is key. We are already hearing TV producers get more excited by the quantity and quality of social chatter about their programmes, than the BARB data – and Zeebox is going to accelerate this.

But whatever people may think about BARB and brand awareness metrics they are accepted currency amongst traditional marketers, so digital is getting smarter about how we measure the value of what we do.

Following on from the Comscore Validated GRPs initiative launched recently, Google is now pushing Active GRPs. Positioned as making the web work for brand marketers the Brand Activate Initiative has two elements; Active View which means the ad was visible for at least 1 second and Active GRP showing the Gross Rating Points delivered; allowing for reach and frequency measurement.

As we said about the Comscore product a key benefit of GRPs is that everyone can see the respective weight of activity indifferent media, which should mean that we see higher spends.

One stat that came out of the(Comscore) research was that many campaigns are planned and bought at far lower weights than in traditional media. One campaign mentioned was 40 GRPs, which means it reached just 8% of the target audience – and was seen an average of 5 times. It’s not too long ago that a typical TV campaign was 10 times the size of that – 400 GRPs reaching 80% of the audience. So if people say online doesn’t work, it could be because it’s just not reaching enough people.

Quick Reads

In a call for people to demand their data back from GAFA Tim Berners Lee also comes out strongly in favour of webapps and open APIs. We think he’s on to something.

Following his investment in Square Richard Branson has now invested in Path – the mobile social app that many believe could be the next big acquisition by GAFA.

Talking of acquisitions we realized who the really smart people were in the Facebook / Instagram deal. Whilst the founders we paid in full, the VC companies that closed a round of finance just days before the deal, doubled their money in just a few days.$50m is a pretty good return in less than a week.

The other recent big acquisition may not be going as well. New data suggests that DrawSomething has lost 2 million players a day recently, prompting the launch of some new features. This is a good reminder that much of the tech world is a hits driven business. Whether it’s content or a device we shouldn’t forget that, just as things can grab peoples imagination and get used by millions, they can go out of fashion just as quickly.

The very smart Michael Wolff discusses this in his piece on how HBO lost the plot. This is a very interesting quote;

Mad Men, Homeland, Breaking Bad are the current flowers of television programming, but they really have little else to do with the networks that produced them – or, at any rate, with the rest of what the networks are producing. They are unique. We seek them out individually; and indeed, more often than not, we find them in all sorts of disconnected places. They seem to float free.

Maybe despite GAFA trying to build walled gardens where content is exclusive, the natural state of hit content is that it needs to be available everywhere. Would Angry Birds be as valuable if it was only available on iPhones?

Finally… in this complicated world where mobile and digital are disrupting every aspect of business, what is the role of an agency? We’re trying to define addictive as an agency that solves business problems by solving consumer problems, using the modern marketing palette of Mobile First, Always Social and ROI obsessed. Our friendNeil Perkin has done some fascinating work for eConsultancy on how agencies are adapting (which we contributed to) and it’s a must read whether you are an agency or a brand.

Does your heart sink every time you get invited to another meeting? Are your days filled with long meetings that should be short? And are some of them totally unnecessary?

Yawn no more – we have launched Meeting Magician- a fun iPhone app that makes meetings fun again. And you can get it on Android and Blackberry too.

Having spent 3 years at Mindshare/WPP either in meetings, on conference calls or on planes, I reckoned people needed some way to ease the pain of this way of life. Red wine works really well on planes but oddly enough is frowned on in meetings (although it has helped me through a few conference calls).

So this app lets you play buzzword bingo when the powerpoint bores get going. It gives you a word of the day to slip into the presentation or the chat with the boss – and you can share your success story with your friends on Facebook and Twitter.

You can find out just how much money is being wasted in a meeting with our calculator – estimate the average hourly rate of the people in the meeting or on the call, key in how many people are taking part and the calculator shows you second by second how much is being wasted. You can share the excess stories on Facebook and Twitter – we expect our friends at Goldmans and Credit Suisse etc to get quite competitive over this.

And when you think you really can’t take a meeting, set up a lifesaver fake call – just programme the app with the time you want to be called and choose who you want to the call to be from – and hey presto  – your phone rings and you have the perfect reason to escape.

And as a further incentive – we offer a money back guarantee. If you have the app on your phone the next time we meet, I’ll buy the tea/ beer – so you can’t lose.

Please let us know what you think – we’re interested in thoughts as to what we add on the next version ( we already plan to add a way to play buzzword bingo with the others in the meeting) – and please write a review on the app store.

SoLoMoPho *

Whilst you could make a strong argument for Apple, Google, Twitter or Facebook buying Instagram we think the one who needed it most was Facebook

As the FT put it;

Buying Instagram is an admission that, while its own mobile app is used by hundreds of millions of people, Facebook was not built with mobile in mind

The math makes some sense. If Facebook do get the $100+ billion valuation when they IPO each of their 850 million users is valued at $118. The price they paid for Instagram valued each of their 30 million users at just $33. And yes some were already FB users and some will close their accounts. But if Facebook have just blended the best way to share photos with the most popular way of sharing them.

We should never forget that the real opportunity for mobile is to take early adopter behaviours like Instagram mainstream and this is going to be an interesting case study.

Of course the challenge for Facebook remains to be monetising their user base. In the IPO papers Facebook say they currently make just $4.39 per user each year.  Brands do use Instagram, but they don’t pay to do so. Yet.

The pivot to mobile at Facebook is happening in other ways too. The support for HTML5 through the Ringmark initiative is becoming clearer with a new blog post explaining what they expect to support in each of the Rings. Interestingly they see the ability to access the camera through HTML5 as being very close.

So we should expect to see a project that started as HTML5 ( the first iteration of Instagram was called BurBn and built in HTML5) return to HTML5 at some time soon(ish)

And the developers section of Facebook has more guidance for integrating mobile with Facebook. Some really useful stuff here.

* Social, Local, Mobile, Photo

eBooks

With the US Government cracking down on Apple and 5 of the leading book publishers for price fixing, the way is open to Amazon to go back to price cutting. A key reason for the publishers to agree Agency pricing was that they could regain control of what prices books are sold at  - with the retailer taking a 30% commission. Whilst Apple (and the publishers) liked this , Amazon didn’t – so they have jumped at the chance to go back to deep discounting.

The danger for anyone with ambitions in the book business is that Amazon – and their closed Kindle reading software and hardware system – become the dominant way people buy and read books. The only credible response would seem to be to drop DRM (Digital Rights Management) which fights piracy but also means that (simplistically ) they can’t get their books onto Kindle. Our friend Matteo Berlucchi from Anobii has been arguing against DRM, opening up the possibility of real competition as anyone can add any book to their Kindle.

As GAFA seek to develop their vertical stacks, they’ll do what they can to prevent anyone else getting an advantage. But the Kindle is a huge asset for Amazon.

Of the ereaders sold in the UK 92% were kindles – and the Kindle Fire is getting close to a UK launch. The Kindle app is huge on iOS – listed as a top 10 Ipad app in terms of downloads. And Amazon are building the ecosystem for developers with the extension of 1 click purchasing to mobile.

Mobile Search

Mobile search continues to grow, with a new study from Adobe showing that mobile search in the UK has grown 250% over the last year – now accounting for 11% of UK total search. In the US mobile is 8% of total search, but the overall search market is growing much faster there – up 16% versus growth in the UK of just 3% – so virtually all UK growth came from mobile. Adobe forecast that mobile will grow to 15/20% of the total over 2012 as conversion rates are comparable to desktop whilst cost per click are up to 30% lower.

Of course for this to work advertisers need mobile landing pages, and we know that 80% of brands are ill equipped for this. Last September we looked at how some of the biggest search advertisers were paying to drive people to non optimised sites and we were disappointed to see that little has changed when we looked again this week.

First mobile advertiser when you search for Mortgages? MoneySupermarket driving traffic to a non optimised site. Loan? CreditSavingExpert with a non optimised site. Insurance? GoCompare – who have a mobile optimised landing page – but when you click on any of the links you go to a non optimised page.

These are three of the most expensive search terms, so these brands are wasting a lot of money. We could build mobile optimised landing pages that would unlock the value of this search and deliver ROI within weeks. What are people waiting for?

Quick Reads

Google + has a new look

Starbucks has processed over 42 million mobile transactions in the US – all without NFC.

Microsoft also spent a Billion dollars this week but they bought a bunch of patents from AOL. Ironically this means Microsoft now own most of the tech of the Netscape browser they fought so hard back in the 90s. Included in these patents are things like cookies, javascript and SSL – all used widely in every browser today. So if Microsoft decides to become a patent troll they could make life very difficult for Google Chrome and the other browsers.

PlaceMe is the new next big thing in location. We’re playing with it and will report back –along with our experience of using Highlight and Banjo over the past few weeks.

Those annoying online ads that chase you around the web after you’ve looked at flight details or hotels can now be thwarted. A US initiative lets you opt out of any ad network tracking and delete any cookies they have on your browser.

Whilst 4G seems to be getting closer (the FT talk very positively about their experience of the current O2 trial of 4G in London) the current experience of the mobile networks is poor. But even so, we were surprised to see £400 signal boosters for the home advertised on TV. Oddly the ads don’t mention the price.

Forrester have shared their 2012 mobile trends  – with no real surprises.

The music industry is slowly opening up their data and there are some cool services emerging.

The excellent IPA Mobile Inspiration day we took part in the other week has been summarized in a good video – though there is a bit too much of us in there.

In Addictive news  - our Android app for Visit Britain launched just in time for Easter and we helped lots of people find something to do to avoid the weather.

Finally …Unlucky for operators?

Longtime mobile analysts Strand have pointed out more pain for operators. Their new study suggests most mobile masts are on rented land and the landlords  are taking advantage by inflating rents.

This reminds us of a former client of ours, who worked at an airport. Over lunch the rep from a mobile operator mentioned that their mast within that airport was the busiest in the country. Our client noted this, went back to her office and wrote to all the operators explaining that they now had to pay a substantially increased rent. If that wasn’t acceptable their mast would be moved to the edge of the airport.

That afternoon she made a couple of million pounds in additional revenue.

We’ve been working with Visit Britain on an Android App for Enjoy England, building on the iPhone app they launched last year.

We’re delighted to say it has now gone live and you can download it here

This is is the official press release;

VisitEngland launches official Enjoy England Android App

30 March 2012. VisitEngland today launched a new Android version of its official Enjoy England app.  This new version is free to download and provides over 1,000 up-to-the-minute ideas for unmissable destinations and attractions across the country, enabling more smartphone users than ever before to plan the perfect day trip or holiday in England. Containing the same rich visitor information as the existing iPhone version, the Android app also offers new functionality, with an inbuilt QR Code reader allowing users to scan 2D barcodes and access information on the go.

Users can personalise their search according to indoor or outdoor activities, or the most popular ‘must-see’ things to do, and those sticking to a budget can be inspired by hundreds of free ideas. Each result comes complete with a Google Map location, and users are encouraged to share their experiences and upload suggestions to the interactive map. The Enjoy England Android app also includes free access to travel content and readers’ tips from The Guardian newspaper and great ideas from enjoyengland.com.  

VisitEngland’s Chief Executive, James Berresford, commented: 
“The Enjoy England Android app was developed in response to the numerous requests we received following the successful launch of our iPhone app. The rapid progression of mobile technology is changing the way we access information, and as the national tourist board, it is crucial that our visitor information is available when and where people need it most. This new app will help even more of us to get the most out of the destination on our doorstep in this very exciting year.”

Visit http://www.enjoyengland.com/Official-Enjoy-England-app/ to download the Enjoy England Android app, free of charge.

-Ends-

Notes to Editors:
The Enjoy England Android app was developed by Addictive, a full-service digital agency focusing on mobilehttp://www.addictivemobile.com/.

Facebook reinventing Marketing

The Facebook Marketing Conference rolled into town this week, with Facebook announcing their new tools and techniques to UK marketers. With pretty much the same story as the event in New York a few weeks ago, they are dialing up the focus on advertising ahead of the IPO.

The big news is their reach generator where by paying, you are guaranteed to reach 75% of your brands fans versus the average organic reach which is around 16% according to Facebook.

Some of the smarter thinkers about social media are questioning this  - pointing out that some brands are achieving 20% reach daily and up to 85% in a month. But with the news ticker impressions now folded into reach figures this is getting harder to measure. The thing is, Facebook need brands to spend money with them on ads rather than spending money on people who optimise the organic reach.

We are going to see new creativity in Facebook and their call for brands (and agencies) to think about why should people care and why should people share? deserves a place in every marketing brief.

This half hour video of  a talk by Paul Adams from the New York fMC is a must watch. A key takeout for us is his idea that a sense of purpose is important. Like John Grant talked about 10 years ago, having a noble cause is a key part of new marketing.

Adams talks about the need for many lightweight interactions, echoing John Willshires’ thinking about bonfires and fireworks.

If you really don’t have the time to watch the video read this instead. Adams also wrote our new favourite book Grouped – another must read. And when he was at Google this presentation of his led to Google+.

As well as redefining how marketing works, another interesting development at Facebook is their recognition that design is really important now.

Making advertising work better

We’ve talked in the past how the $50 billion gap between time spent online and the money spent online is having a corrosive effect on content creation. As analogue dollars turn into digital cents, most of the media organizations creating the content that people value are struggling with the need to produce more content for the same or less money.

Michael Wolff has written a great article on how the business model for news is imploding as mobile grows. He does the math and shows how mobile is getting a fraction of the revenue of online, which was already much lower than print. In effect $100 revenue in print shrinks to a $1 on mobile.

Unless we sort out the true value of online and mobile advertising, the content that draws the eyeballs will disappear.

New research from Comscore will help. Their validated impressions mean that online advertisers can now be confident that the right people see the ads they buy. The tool allows advertisers to measure reach and frequency against various audiences, using GRPs to give a much closer comparison between online and traditional media. One stat that came out of the research was that many campaigns are planned and bought at far lower weights than in traditional media. One campaign mentioned was 40 GRPs, which means it reached just 8% of the target audience – and was seen an average of 5 times. It’s not too long ago that a typical TV campaign was 10 times the size of that – 400 GRPs reaching 80% of the audience. So if people say online doesn’t work, it could be because it’s just not reaching enough people.

So better measurement should encourage higher investments, but to close that $50bn gap we need brands to invest as well as the direct response businesses. Google are developing a research study to improve the way advertising impact is measured online, which is promising.

The research project we’re planning – to prove that mobile can build brands, based on our ancient YesSirNoSir study  - is coming along nicely and we’ll shortly be looking for media partners. We’re also developing some thinking around whether Robert Heaths seminal work on Low Involvement Processing could be how online advertising actually works. We’re keen to talk with any research companies interested in helping us develop this.

Patent wars

We mentioned last week that Apple were trying to impose a new nano Sim format on the market. Rival device manufacturers, including Nokia and Motorola are resisting this as they fear Apple could exploit the patent at some time in the future. Well Nokia are fighting back by flexing their patents. They are threatening to withdraw 50 patents they hold if the Apple proposal is approved. This would mean that no-one could build a Sim card to Apples designs but wouldn’t affect current Sims.

Patents are becoming a huge issue in technology. A key reason for Google buying Motorola was obtaining 17000 patents, with a further 7500 pending.

Facebook are getting in on the act too, with a more modest purchase of 750 from IBM. But given that they apparently only had 56 before, it’s a big step up.

Mobile disruption

Amex is using mobile and social to carve out a new position in money and their view that we’re 4 or 5 years away from the tipping point for mobile wallets to really take off is interesting. Dan Shulam of Amex thinks the retail refresh cycle for upgrading instore payment terminals is around 4 years. This supports our view that there is no business model to support retailers investing in new kit, so we’ll have to wait for it to wear out before NFC becomes common.

Another interesting part of mobile money is direct to bill payments, where purchases are added to your mobile bill. UK firm Banjo has built a strong position in this space and now work with Facebook, Amazon and RIM. This TechCrunch roundup is an interesting read.

Further evidence of the disrupting effect of mobile on retail can be seen by this new app from US department store NiemanMarcus. The app does all the usual stuff but also announces your presence to staff, allowing for a whole new level of CRM. And the location based shopping app ShopKick has added some heavyweights to its board.

Quick reads

The torturously slow path to 4G in the UK may be slowing down further, as 3 announce they intend to take legal action over the way Ofcom are planning to conduct the auction for new bandwidth.

Last week we looked at how big brands were rethinking their approach to marketing, including Cokes liquid and linked strategy. This is a good look at how Coke are using mobile

Siri may not be used that much by most people, but the developers are very bullish about the potential for Virtual Personal Assistants and have new services launching soon.

Google have a new patent – so they can analyse the background noise from your phone and use that to target ads.

Finally

We had a lot of fun at two excellent events in the last week. At Mediatel we took part in a really good panel (including Google, RBS and Everything Everywhere) talking about the role for operators and why money isn’t flowing into Mobile – yet. And at the IPA inaugural Mobile Inspiration day we did Mobile Fix live, summarizing the key themes from a series of impressive demos, including Google, Apple, Zeebox, Aurasma & Blippar.

Given its Easter next week we’re going to rest Fix, but if you need some smart thinking this long article from Fast Company is really good. It focuses on the rise of the New Economy (yes it’s back and this time its real) and the need for businesses to embrace Flux.

What defines GenFlux is a mind-set that embraces instability, that tolerates–and even enjoys–recalibrating careers, business models, and assumptions

This week we learnt that Mobile ad spend in the UK is up by 157% to £203m. Which sounds like progress, until you remember that total adspend is getting on for £12bn and online is well over £4bn. So we have a way to go yet.

We learnt from a new study from Boston Consulting Group that the internet economy in the UK is worth £121 bn– making the UK the best performer in the G20. This quote sums up the study;

It demonstrates that no one—individual, business, or government—can afford to ignore the ability of the Internet to deliver more value and wealth to more consumers and citizens more broadly than any economic development since the Industrial Revolution.

But you could argue that the effect on the marketing industry has been relatively muted. Of course every agency and every client now includes digital in their thinking but money hasn’t yet followed audience. Morgan Stanley still talk of the $50bn gap between how people spend their time and where advertising spend goes.

We’re convinced that the mass market adoption of smartphones will accelerate the closing of this gap, but we think every element of the marketing industry is going to need to change. Sounds farfetched? Smart brands are already changing;

Nike;  “Connecting used to be, ‘Here’s some product, and here’s some advertising. We hope you like it,’ ” he says. “Connecting today is a dialogue.”

P&G; Mr Pritchard (P&G Global Brand Builidng Officer) pushed P&Gs recent digital-is- more-efficient strategy, saying digital and public relations give P&G the greatest return on investment and ”go hand in hand”

Coke “All advertisers need a lot more content so that they can keep the engagement with consumers fresh and relevant, because of the 24/7 connectivity. If you’re going to be successful around the world, you have to have fat and fertile ideas at the core.”

The two videos in this article are well worth watching; Coke VP of ad strategy Jonathan Mildenhall talks about Liquid and Linked Content as he explains their new marketing mission statement very eloquently. And he has kept his Leeds accent rather better than I have.

General Mills; With digital our packaging is becoming a platform for us.

Unilever;In a digital age, that means inviting and empowering people to own our brands – their brands – and shape them alongside us. Creating marketing that is social by design. Helping people tell their brand stories, not just hear ours

So these brands aren’t looking at business as normal. They are recognising that the new digital opportunities are driving a rethink of what marketing means.

As brands can observe their customers digital body language they can create a real dialogue. The huge amount of data has a fundamental effect on marketing – the story where US retailer Target knew a customer was pregnant before her family did is just the beginning. The Guardian has a good look at the sheer scale of data being produced, which is requiring new language; watch out for yottabytes – which would be written as 10 followed by 23 noughts

So all those people who talk about Data being the new Oil are right. But a big problem is that few of the people who talk about Big Data actually have a clue what to do with it. We can expect a whole new class of technology firms focused on helping marketing make the most of this data.

As our friends at Google always say Data beats opinion, so we’re moving to a fact based approach to marketing, that encourages experimentation. There is still room for creativity in this moneyball marketing world – but we’ll see people pretoptyping* ideas inexpensively and only spending money on those that are shown to work. The smart people at Albion explain this brilliantly in their write up of their latest work for GiffGaff. Of course not every agency gets this new age as this US story shows

*Pretotyping is a really big idea so well worth reading up on.

GAFA

The Harvard Business Review has a good comparison of the business models of Apple and Amazon. Interestingly they see that Amazon should be a better partner for content players, because they make their money through software sales, whilst Apple make theirs from hardware.

Amazon’s incentives seem more aligned with those of its media partners (“we win together over time”) than Apple’s with its partners (“I win first; you later…maybe”).

Amazon continue to invest in the logistics of their business, buying a company that makes robot pickers for their warehouses.

Apple are pushing a new standard for nanosims – which are around a third of the size of the micro sim cards in the latest iPhones. Motorola (now owned by Google of course) Blackberry and Nokia prefer another solution, fearing that Apple could end up owning a potentially valuable patent.

And the desire to game the Apple app store – which is essentially broken - is leading to lots of dodgy practices.

Google are starting to monetise their dominant position in mapping, leading some people to look elsewhere. Obviously Bing will seek to take advantage but could this also be good news for Navteq? – bought by Nokia for $8bn a few years back.

Facebook tells marketers; If you want bigger ads, you’re doing it wrong.

Games

Disney have developed their first mobile first character. Swampy has been launched through a mobile game called Where’s my Water, which is at the forefront of Disneys’ drive into China. The Disney mobile guy says thatsomeones going to build a game that will reach a billion people.

Could that someone be OMGPOP? 6 weeks ago they launched a game called Draw Something. It has sold 35 million copies. And now they are being bought be game giants Zynga. For $200m!

This interview with Zynga founder Mark Pincus is worth reading.

Quick reads

The vast majority of smartphone data traffic is on wifi rather than the mobile operators.

Interesting thinking around NewTV – why TV makers shouldn’t ignore apps.

Good thoughts on what social finding apps like Highlight, Glancee and banjo need to do next

Good mobile campaign from Australia that is properly integrated with the rest of the campaign

Finally… We came across some old thinking of ours – from back in 2007 – Time to Embrace Mobile Advertising. Whilst most of it still makes sense, it is remarkable in that its pre iPhone.