Category Archives: Google

Mobile Fix – May 10

Posted by Simon Andrews on May 10, 2013 None comments

The future is already here – it’s just not evenly distributed

Whilst the pace of change of GAFA and the huge scale remains a key issue for any brand, its still worth looking around the world to see how people are using mobile and social in a simpler way.

The geeks amongst you will recognise the William Gibson quote – and nowhere is it truer than in mobile.

Take the Unilever campaign for Wheel detergent in India. Promoted on radio and by outbound calls people were encouraged to call a 0800 number, then hang up. They were called back and hear an entertaining clip from a well known comedian and his endorsement of the product. 16 million calls drove higher brands awareness and a spike in sales. Watch this video for the full story.

Still in India, Intuit has developed a new mobile service for farmers that gives free advice and information on agricultural issues by SMS. For example, helping the farmer make more money through telling them crop prices at local markets – so they can go to see at the one paying more. And Intuit make money by selling advertising on the service.

In Africa IBM are using mobile data (looking at where SMS messages are sent from) to map bus services and look for ways of improving the routes. A similar service in the West is Waze where 47 million drivers share their location and traffic news – and it seems Facebook are about to buy them.

Back in India, an IT company called Mastek have taken the traffic idea one step further. To help make the company buses that pick up employees more efficient, they developed a featurephone app so the driver of each bus has their phone on the dashboard.  This means their system can poll the app for exact location of the bus at any time and send a SMS to the employees waiting for it, when it is 10 minutes away then 5 minutes away. There is a big opportunity in apps that work on featurephones, but this tends to be overlooked as developers focus on smartphones. Back in 2005 we worked on the market entry of Refresh Mobile – now better known as Mippin – and did a lot with java apps. There is a lot of friction in developing for phones with small memories and requiring lots of accepts to install etc – but it can be done.

Of course GAFA is active in these emerging markets. Facebook have a team focused on partnerships with operators to encourage Facebook usage whatever sort of device you have. Google are pushing NFC payments in Kenya and their very interesting Trader platform – where you can buy and sell just about anything – works on SMS in Uganda, Nigeria and Ghana.

“It’s the medium of future and the future has already arrived”

Eric Schmidt has caused a bit of controversy this week by implying YouTube has already crushed regular TV. We’re not sure he actually said that; and we do have some experience of journalists misquoting you to make their story hang together better – especially when Google is involved.

For us the two key quotes were Eric Schmidt saying;

“It’s not a replacement for something that we know,” “It’s a new thing that we have to think about, to program, to curate and build new platforms.”

And Jeffrey Katzenberg of Dreamworks saying;

“This is a whole new form of content, content delivery and content consumption,” “It’s the medium of the future and the future has already arrived.”

This NYT video on the video upfronts shows how seriously people like AOL, Yahoo and Hulu etc take this . OK, Sarah Jessica Parker presenting a series on ballet isn’t much of a threat to the Village or Broadchurch but it compares well to the typical programming of those channels not on the first page of the Sky EPG. The key thing with all these new opportunities is can they get the scale advertisers like

The Head of Fox this week agreed that things are changing and the broadcasters need to adapt;

…broadcast TV remained “the dominant form of event television” but was stuck with “historical practices” such as creating hundreds of pilots for series which never air. Broadcasters needed to target investments to fewer shows, he added

As Amazon have entered the world of Pilots it is clear that everyone now see the web as a video medium rather than the text one we have grown accustomed to, because of bandwidth restrictions. Looking at the Amazon initiative the LA Times puts it well;

..what makes the Amazon pilots impressive is not that they create something radically new but that they do “real TV” so well. Their true message is that there are new Big Guns in town, and that, just as broadcast TV lost much of its market share to cable, both are going to have to make room for the major players of digital television — not the diffuse, if sometimes brilliant voices of the medium’s shoestring pioneer age, but rather highly professional ones, well-funded and well-positioned to own the Web-based future

The VC community also gets this opportunity. Mark Suster – who just hired the former head of Endemol – summarises the argument well;

  • People watch 5.3 hours of TV / day. They read less than 30 minutes. You can’t change media consumption patterns easily. The future of the Internet is video. Full stop.
  • Production costs have fallen more than 90%. Distribution costs have, too.  This is classic “Innovator’s Dilemma” market conditions.
  • My estimate is that the top 5 YouTube networks will do > $200 million net revenue in 2013 (after Google’s share)
  • These same top networks – Maker, Machinima, Zefr, FullScreen, BigFrame – and the like have create nearly 1,000 new tech / media jobs in LA in the past 3 years alone.

The ad industry already gets this to some extent – just look at the YouTube leader board where ads are getting 10s of millions of views – through paid and organic views. And an event we spoke at last week, organised by Brainient, underscored how well developed the ecosystem is for video on both the desktop and mobile – although the creative community have yet to really step up.

Branded Content  – back to the future

We have talked about how The Hire from BMW set the bar for branded content some 10 years ago and now see that Jaguar have taken some inspiration for their latest launch – even using the same production company.

Their film for the new F type is interesting but doesn’t seem to have got much traction yet – 67k views on YouTube after 3 weeks doesn’t seem too impressive, but we don’t know how many views there have been through the Jaguar website.

Still it doesn’t quite have the panache of the BMW films. Our favourite Beat the Devil, featured one of our heroes James Brown – who would have been 80 this week – and was directed by Tony Scott. Well worth 10 minutes of your time.

Content is the hot topic amongst brands and the response amongst agencies has been quick. This US blog lists out some of the responses by US agencies. A key quote is

Before a brand hires an agency for content marketing, they should ask to see the work they’re using on their own behalf.

Given you’ve chosen to read our content, we’d like to think we get this space well and we’re looking to do more for our clients. It’s clear that modern digital marketing has to deliver in content, social and mobile to be effective.

Mobile & OOH

After a big consultancy project around this topic recently, we were very interested in the excellent Mediatel event on this subject this week. It is clear there is a real synergy here. We think things like the ClearChannel 10,000 bus shelters across the UK with NFC and QR built in should drive innovation in this space.

But we believe the real opportunity with mobile and DOOH is the ability to create campaigns that match supermarket catchment areas. Few brands are stocked in all supermarkets – and even within, say, Tesco products may be in a limited set of stores. The ability to target people who can actually buy the brand advertised should be a big boost.

But we wonder whether the big retailers could play a part in making this happen. As both Tesco, Amazon and others start to play in content and start to use their customer data to help brands reach consumers the game changes. Tesco want the advertising on their developing media platform to drive sales in Tesco – and they will start to expect brands that want to be stocked to invest in these new opportunities.  But given it will take some time to build their own audience, why wouldn’t they buy DOOH around their stores and resell it to brands – with mobile geo fencing as well?

Sound farfetched? Well how about Target building a tool with Facebook to offer deals that can only be redeemed instore.

We will see retailers collaborate with all sorts of media owners to better drive sales. Interesting times for SoLoMo and for retail.

Quick Reads

45% of Groupon transactions are now mobile

This is a good look at the fascinating work done by MIT – robo cars, air gardens, bionic men and lego.

And the MIT view of breakthrough technologies for 2013 has just been published.

The iPhone is big in Japan

We use LinkedIn a lot as a way to keep connected to people – but as Ben Evans points out it needs some work.

Half of brands still don’t have a mobile optimised site. And of those who do, too many still have a rubbish one. In our experience the quickest ROI is building a really good mobile optimised site and unlocking the huge value in mobile search.

Book of the week

Another brand new book – but pretty much everything Brian Solis writes is worth reading.

So our book if the week this week is What’s the Future of Business by Brian Solis

Finally…..More evidence of the annexation of marketing by tech and consulting firms. The very smart service design firm Fjord has been bought by Accenture. The AdAge headline Agencies, Look Out: Accenture’s Invading Your Turf in a Bigger Way Than Ever is slightly hysterical but there is something significant here.

A couple of weeks ago we quoted Antony Mayfield and his Firestarter deck where he said the challenge for agencies was become McKinsey faster than McKinsey becomes you. It looks like we need to get a move on.

Not convinced? How about this then; BMW have appointed Accenture to manage their global digital presence, all their digital marketing and the agencies. And in the US Amazon have given Accenture the job of managing the review of their media buying account.

Can agencies get past their old business model and be credible partners to brands in the age of GAFA? It requires taking digital much more seriously than most currently do.

Mobile Fix – April 12

Posted by Simon Andrews on April 12, 2013 None comments

Facebook Home

So Home from Facebook has arrived and it’s … interesting. Because of the limited range of android handsets that Home will work on, its initial impact may be a little muted. And as a sort of modern equivalent of a Google Toolbar it’s likely to only really appeal to hardcore users. But with a billion users you don’t need big percentages to make a big impact.

Home underlines the laser focus on mobile that Facebook now has and is a clear signal of intention – so the reaction of Google and Apple will be interesting.

Does Google tighten it’s hold on Android to curb the enthusiasm of Facebook and Amazon to hide data from Google? Or do they push forward with Chrome and evolve that into a mobile operating system?

For Apple this is also an issue. There is no way that Apple would allow anything like Home, but on the basis your enemies enemy is your friend, we should expect to see even deeper integration of Facebook on the next version of iOS. For a more in depth look at Home, you should read this Guardian blog.

Advertising will be included and we think Facebook may be about to realize one of the most enduring mobile business models – homescreen advertising. Lots of people have tried to build a business monetizing the fact we look at our phones 150 times a day – but outside Celltick in Asia no-one has made this work. Maybe Facebook can

This good Vanity Fair article on Facebook is worth a read too – a typically thorough look at how their approach to advertising has evolved.

But just out is some really big news from Facebook; Partner Categories - a new targeting option that uses data from 3rd parties such as Acxiom and Datalogix. This allows brands to target people based on actual purchase behaviour – although anonymity is preserved.

This ability to blend the precision of direct marketing with the scale of Facebook is really exciting.

Quantity – now what about Quality?

The recent mobile push from Facebook isn’t reflected in these figures but the new numbers on mobile advertising in the UK are impressive. At £526m it’s up 2000% since 2008 and now accounts for around 10% of total digital spend. The £300m of fresh money accounts for half of the overall digital growth over the last year.

Search is still dominant at 69% of the mobile total (versus 58% of all digital), so Google are the major beneficiary. With both Apple and Amazon hiring salespeople we can expect lots of energy from GAFA helping drive this space forward.

Clearly there is still lots of potential growth but any brand should question why mobile isn’t a substantial part of their digital marketing now.

So the quantity of mobile advertising is doing OK – we would argue that the quality has a way to go. But with that level of spend we’d expect brands to start investing in creative that makes the most of the opportunity. However we see mobile suffering from the issues that plague digital as a whole – a lack of focus on how creative can transform the economics of digital marketing campaigns.

Some former colleagues from our Modem Poppe days talk about how they see online;

My philosophy has been if you’re not serving the customer with what you put online you’re going to end up in a bad place. Most [banners] aren’t serving value. They’re in the business of interrupting what you’re doing. There’s a limited creativity that’s been applied with what you can do with that space and the space itself is very limiting

The Brazilification of advertising

(This has nothing to do with Agencies being scalped by client procurement teams…. )

With MadMen back, there is quite a lot of looking back at the golden age of advertising. In one piece Keith Reinhard of DDB points out;

A lot of bad ads were created at that time too that we don’t remember and that we shouldn’t remember

But in that golden age the craft and tools needed to make advertising were rare and expensive. Laying out and typesetting the VW Lemon ad was a craft, as was preparing it for printing. Now it can be done by anyone on a laptop really quickly.

So it seems prescient that we come across Blur in the same week. This UK start up acts as an exchange for business services and a large proportion of the jobs are around marketing. In the FT they report 359 briefs in the first quarter, with an average value of $11k.

The live briefs cover all sorts of marketing needs, with a lot having a budget of £2500. That would buy around 3 hours of a designer at some London agencies but the site has lots of big clients listed and glowing endorsements; Butlins were…”thrilled with the results at half the price of other alternatives for our apps” Now some Butlins apps look like they were designed and built by Redcoats, but others aren’t bad, so this service works for some clients.

Brands are waking up to that fact that making stuff has never been cheaper – - we are seeing clients realize that the assets inexpensively created for Facebook and YouTube can be used in traditional media – causing them to question the usual cost structure for traditional media production.

Of course some brands will always be happy to pay top dollar for the top talent and the top tier agencies – especially the ones owned by a tech firm – have a fairly secure future. And there will be a growing market for the people who offer their services through Blur and all the similar services.

But for the agencies in the middle, Brazilification is real.

Brazilification – the widening gulf between the rich and the poor and the accompanying disappearance of the middle classes.

–      Douglas Coupland – GenerationX

The rebirth of branded content

Content marketing is getting a lot of attention right now and Buzzfeed are the most obvious example of how successful it can be. With link baiting headlines and lists of the cutest cat photos the new UK version is similar to the US one – but tailored for a British sense of humour.

It’s easy to dismiss this, but they are getting client traction – this in depth look at the US business suggests they could make $40m in revenue from brands like Pepsi and Virgin Mobile. One thing that is really interesting is their thinking around how and why things get spread – they believe there is a Bored at Work group who drive sharing and they make viral hits. This deck from the founder gets into more detail on their approach.

We’re very interested in this space, especially as we see native advertising as being a driver for mobile advertising. Of course the space is not new – we launched Big Picture as a content agency in 1995, but got distracted by social (My Space) and mobile apps for Java phones. Back then the hot term was Branded Content and whilst much of the work focused on brand funded TV there was one example that demonstrated that done correctly, this stuff can work incredibly well. BMWs  series of short films The Hire was viewed over 100 million times – in the days before YouTube so each episode was watched on the BMW site in a special player that had to be downloaded. And before Facebook, so all the sharing was done via email.

newTV

One of the factors that makes content marketing so promising is the constant evolvement of new TV. We looked at how Hollywood is embracing YouTube last month and there is now a good look at the UK scene. As well as this article there is a good series of YouTube shows exploring the whole sector . Not its unlikey any of these people will turn out to be the next David Frost or david Attenburgh. But there is a good chance that the next Piers Morgan or Ant and Dec will emerge through these channels, but we don’t think the transition to traditional TV is as likely as it once was.

There is so much money in TV its hugely attractive to new players who want to disrupt it. From Google investing in content through YouTube channels to Tesco investing in content and launching Clubcard TV there is lots of change. The games consoles and tablets are preparing the way for connected TVs and people are looking to learn now. This interview with the head of Tesco Digital Entertainment is worth reading;

We believe we are well placed to ride the entertainment on demand swell at this critical time as entertainment migrates from physical to digital.

And technology could play a part too – in the US a start up called Aereo is shaking the market up by allowing people to watch the key channels on their smartphones, tablets and PCs by exploiting a loophole in the US legislation. Backed by Barry Diller this could have a huge effect on the US market.

TVCatchUp is Europe has a similar approach, but its unclear following a new European court ruling what will happen next.

Neither of these players affect the advertising within the channels they carry but Michael Woolf has written a good piece on how advertising is so easy to avoid these days. He argues that – over the 6 year life of the MadMen series – the way people consume content has changed, whilst industry hasn’t.

In a very interesting talk, Susan Wojcicki of Google makes the case that – in the future – ad views will be voluntary. With TrueView ads on YouTube Google only get paid if people choose not to skip the ad – and around 70% of all YouTube ads are now TrueView.  There has been a 40% drop off in ad viewing but one 4 minute ad for Pepsi has been seen 33 million times.

Is this the future? If so the Brazilification continues – only those that can create content people want to watch are going to get paid.

Quick Reads

Google have upated their excellent Think Insights with new content around mobile Gen C – their take on the YouTube audience.

Saul Klein shared his thinking around the fact that the internet economy accounts for over 8% of the UKs GDP. This world leading position makes the UK a great place to be involved with digital. The presentation is a must watch.

Google + is now bigger than Twitter.

Foursquare has raised another $41m  – can they now define their business model?

Yahoo is wooing Apple to get more of their content onto the iPhone. Is this a threat for Google?

Some clients  and Agencies are skeptical about the rush to Exchange or Trading Desk buying in media

Google Blink seems to have restarted the browser wars – and may slow down the rate of adoption of HTML5

Book of the week – Paul Adams is the man who architected Google + before moving to Facebook . This book is a really good look at how people are connected and how sharing works. Whilst it draws on lots of academic thinking Grouped is very readable and highly recommended.

Finally ….one  of the true MadMen Maurice Saatchi has weighed in with some smart thinking on mobile advertising;

A good specialist mobile agency will help to reduce the complexity of mobile and retain the simplicity that needs to govern a brand’s advertising outlook. Brands need to be free to focus on the age-old truths of advertising which is getting clear and impactful messages to the right customer. Mobile even extends this to delivering it in the right place and at the right time.

We’ll be talking about this sort of thing at the Facebook mobile event later today – if you are there do come and say hello.

Mobile Fix – March 8

Posted by Simon Andrews on March 8, 2013 1 comments

Facebook Remix

The big news this week is happening as we write Fix – Facebook are to launch their latest redesign. Rumours suggest that the key feature will be to atomise the news feed making heroes of music feeds, photo feeds and perhaps even feeds of links friends have shared and updates from other apps like Instagram and RunKeeper. TechCrunch also remind us of a rumoured radical redesign of the mobile app that could be part of the redesign.

In a New York Times piece Zuckerberg is quoted as saying that;

“Advertisers want really rich things like big pictures or videos, and we haven’t provided those things historically,”

Remixing the experience so it looks more like Flipboard, Google +, Path etc could create an environment where ‘richer’ ads feel more at home. But will users go for that?

Teenagers over Facebook?

Stories of user malaise are circulating again, with new reports that teenagers don’t like Facebook and prefer to spend their time with Instagram and Snapchat

As we have talked about with Apple, with big success comes a big problem – early adopters want something new. Facebook crossed the chasm a while back and they can have a great future as the ITV of social – and let Instagram be the MTV.

The problem about users not liking advertising is an industry one rather than  just for Facebook (and everyone else in GAFA). We are always quick to argue against the myth that people don’t like advertising. People don’t like irrelevant advertising but they do like relevant, useful advertising – and it doesn’t hurt if it’s entertaining too.

Messaging Tapestry

We’ve been spending quite a lot of time looking at the ad opportunities on Facebook and they are quite intoxicating.  The wonderful granularity of targeting that Facebook allows means it is quite easy to find the right people. And there are now some really interesting rich media ad formats with video, through vendors like Celtra and Moontoast. Combine these with the huge reach that Facebook can deliver and it’s hard to argue with the Facebook pitch – especially when it comes to mobile.

But of course we see that many agencies are missing the opportunity by eschewing the targeting in favour of mass reach, with just one or two ads used. The real value of Facebook can only be unlocked with lots of creative work where each message is relevant to a specific target group. Building a messaging tapestry like this can still deliver huge numbers – and everyone sees relevant ads; it’s just a bit more work for the agency. But we are convinced the returns will make this worthwhile.

MIT has a good look at the considerable progress Facebook have made on mobile so far – with a good quote

Everyone, including Zuckerberg, worried that users might balk at ads mixed with posts from friends. So far, that hasn’t happened. Tests that Facebook ran found the insertion of ads reduced comments, likes, and other interaction with news feed updates by 2 percent, a small decline that the company deems acceptable.

Carolyn Everson, the head of sales at Facebook, shares this illuminating quote in a good interview;

“When Mark [Zuckerberg] first interviewed me, he said: ‘I want the content from marketers to be as good as that from your best friend.’ That was his vision – I don’t think we’re there yet; I think it’s a long-term vision that we have to get to – but the goal is to have marketing become as integrated an experience as any content you’d get from your friends.”

It’s our job to make this happen.

Google Delivers

In an interesting video interview the Google head of sales Nikesh Arora makes a similar point about advertising – people want advertising that’s virtually indistinguishable from information. Google built their business doing this with adwords – which 40% of UK consumers don’t know are ads.

Of course the key factor that caps adspend is the uncertainty over whether it works. And the best way to know whether it works is to be involved in the sale – something Google has got closer and closer to with analytics etc.

Now it seems Google want to go further. They capture the intent, they can facilitate the transaction with their wallet and now they are going to deliver the goods on the same day.

“The transaction is the ultimate click,..”

This takes them head to head with both Amazon and eBay who are trialing similar services.

As Marc Andreessen has said, all (most) of the dotcom ideas were good ideas, just too early. Kozmo was heavily backed and its model of 1hour delivery was popular with people  – they just burnt through their VC money really quickly. But just as ASOS looks a lot like Boo.com and Groupon like LetsBuyIt, maybe the Kozmo idea will actually work now.

But as the supermarkets know, it’s not hard to acquire customers for home delivery services – it’s just hard to make money. For all the vans tearing around London streets delivering groceries it’s rumoured that the supermarkets lose £15 on each delivery.

Given that lots of people just aren’t at home to take delivery, we wonder if these same day services won’t be part of the colonization of the High Street by GAFA. eBay have experimented with popup stores, Amazon have lockers in Spar and the idea that Google should have retail stores in getting traction.

In a neat demonstration of just how intertwined GAFA is we saw data this week showing that the biggest user of Google paid search is Amazon – by a huge margin.

One group that does seem to buy the Google story is investors, with a lot of money switching from Apple to Google.

“It’s no coincidence that Google’s rise has coincided with Apple’s demise,” Elsheshai said. “Making money from services versus devices is growingly perceived as a better business model.”

Tesco TV

Tesco continue to build out there content play. They have hired top talent to run their book and music divisions.  And in an audacious move they are taking on Amazon and Netflix with a film and TV streaming service – which is free for their 16 million Clubcard customers.

With all the data they have on customers brands will be able to target advertising precisely  – and in theory they should be able to measure effectiveness through sales. This is a very significant move and we’ll come back to look at it in more detail soon.

Quick Reads

This week Amazon kicked off its new advertising play, with the launch of their mobile ad network for Android devices,

More smart thinking on how marketing is changing – this time from Forrester.

Nature thrives on complexity and so too does innovation. As of yet, few marketers are meeting the demands that accompany this seismic shift in consumer behavior, and the effects are showing

Growth hacking score high on buzzword bingo right now – this article explains and demonstrates how crucial this focus on the detail is. We think MoneyBall Marketing is a better term.

Our friends at eBay have shared their plans for this year;

In 2012 we exceeded our original targets for mobile sales reaching $13 billion and we’re expecting to see this grow to over $20 billion this year.

Ever wondered just how search actually works? How your esoteric search query triggers millions of results all nicely ordered in terms of relevance  – within a fraction of a second? Google shows you here.

This is a good round up of the current state of mobile advertising  - agreeing with our take that its still early days yet. Yet again we find ourselves agreeing with Marc;

“I think mobile advertising is going to be more lucrative than Web,” said Marc Andreessen, the tech entrepreneur and investor, during an interview in New York City in December. He described a smartphone that knows you, your money, your habits, your wants: “The targeting is going to be amazing [and] more valuable.” He paused, and added, “These formats don’t exist yet. They have to be invented.”

Since we covered MWC last week we have read a few other reviews and these tow are well worth a look; Thomas Husson from Forrester and mobile guru Chetan Sharma

We have never been convinced by NFC, suspecting that something new will make it redundant before it gets anywhere near massmarket take up. And now we think we know what will take its place – Graphene.

New thinking from John Willshire is always welcome and this new deck is really thought provoking

Finally ….  we sometimes get stick from people over our constant refrain that our business is changing . Lots of people think it’s still pretty much business as usual – as long as you throw in a bit of social and use the latest buzzwords. This piece from the media team at New York agency Kirshenbaum shows the profound changes that result from embracing the new opportunities. – Everything you know about the media business is about to change.

We are out and about speaking at the moment. We have another talk at Google next week  – this time as part of their Squared initiative – then we are talking about Tablets at the WARC  Measuring Ad Effectiveness conference. And next week we will be taking part in the MediaTel Media Playground event  - always a very interesting event.

If you are at any of these events do come and say hello.


Mobile Fix – January 18

Posted by Simon Andrews on January 18, 2013 None comments

Music Disrupted

The demise of HMV and Blockbuster hasn’t surprised many people (except those of us amazed that Blockbuster still had over 400 stores). But it does disappoint. There is still a huge value in advice and discovery that the online players don’t do that well  – yet.

Just 5 years ago HMV was worth around £500m. All the factors in it’s demise were already here; Amazon was a major player, iPods were everywhere, Facebook was taking off. Whilst Spotify wasn’t around, LastFM was. And the VAT loophole that enabled people like Play (which is also closing its retail business) to undercut UK retailers has been closed. So why was the business valued at just £5m before they went into administration?

As we know smart retail businesses are combining their high street presence with online; for example most fashion brands sell through eBay and ASOS as well as their own stores and their own websites.

Whilst HMV diversified into other aspects of music such as live venues, and sought to innovate around eBooks when they owned Waterstones, they were slow to innovate around their core business.

The one bit of the business that really worked was (is) Fopp –who HMV saved from closure a few years back. With a big selection of music, books and DVDs (in quite small stores) aggressive pricing and helpful staff, we have spent much more time -and money – there than in HMV in recent years.

As the recent revival in local bookstores has shown, there is a market for good selection and advice, so people can discover new content. Even Amazon struggle with discovery – other than the simplistic people who like this, like this.

We think the next big step in this space is social discovery – where knowing what your friends like is a big help, but still quite unstructured. And where you could see what people who like similar things to you, are enjoying. We have a concept in this space we have been working on, so happy to share thoughts with anyone in this space.

Facebook does Search

Social discovery came into the spotlight this week with Facebook announcing their Graph Search – enabling users to see what their friend have done and what they like. It feels like this is still early days, with a limited beta program. By the time it goes public we expect it to have evolved – and to have some advertising opportunities baked in. John Battelle has some smart thinking about Graph Search here, where he speculates it will (eventually) extend to content and to all the stuff that gets into Facebook through the Open Graph.

One thing he mentions is that people will work to polish their profiles as they understand how people use search. So will people still check in to cool bars o Foursquare and review the new local restaurant on Yelp, when doing so in Facebook will better populate your profile?

Recall that when Google burst onto the scene, it prompted a dramatic response from owners of web pages, who immediately began rewiring their sites to be optimized for search. Similarly, Facebook’s Graph Search will incent Facebook users to “dress” themselves in better meta-data, so as to be properly represented in all those new structured results. People will start to update their profiles with more dates, photo tags, relationship statuses, and, and, and…you get the picture. No one wants to be left out of a consideration set, after all.

There is also a new requirement for brands on Facebook – working to ensure you get found in the right kind of searches. So SEO comes to social.

It is another example of how Facebook is slowly sucking the oxygen out of the web ecology, increasingly positioning themselves as a rival to Google as the one stop shop for brands looking to reach people online.

The FT points out that Google anticipated this move and that’s why they launched Google+. They also say;

The battle lines in the new search wars have now been drawn. From Amazon, which handles more product-related searches than any other company, to Apple’s iPhone-based Siri and now Facebook’s social search, the new combatants are starting from their own positions of relative advantage.

Retail Disruption

Last week we saw how some of the big retailers had fared over Christmas. We now have eBay sharing their success story – sales up by 18% in the last quarter with mobile for the year hitting $13bn. And Paypal did $14bn across the whole year.

Their CEO has been outlining plans to push Paypal into more retail partnerships – and says

Mobile is quickly becoming the new normal,

His forecast for this year is both eBay and Paypal to reach $20bn in sales. Of course in a flat economy that is a huge chunk if money that someone else is going to lose – so the tough times on the high street aren’t over yet.

Another big factor on the High Street is delivering targeted discounting and we think the best people in this space are ShopKick. This app has 4 million users making it the biggest shopping app other than Amazon eBay and Groupon.

They have announced they are profitable and their deals drove sales of $200m across their partner retailers. We expect them to arrive in Europe some time soon.

The interesting thing will be when they embrace payments, as without that they remain vulnerable to people like PayPal

Industrialising Creative

We were invited into Facebook this week to share our views on mobile and social advertising. We talked about the need for ads that fit into the Flow of content and discussed the depressing fact that most campaigns use a very small numbers of creative and there is little creative testing going on.

So we were please to see our friend Rob Norman articulate the issue in his own inimitable way;

.. levels of targeting granularity at IP, individual, household, set top box, zip plus four, zip and zone level and you can safely conclude that delivering exactly the right message to the right person at the exact time and place required, overlaid with feedback loops and data is a reality.

In all this lies a problem and it’s all about manufacturing the assets to populate the opportunity presented by the changes above.

As we keep saying, we need to find ways to industrialise creative production, without losing the magic of the idea. Are there any startups making any progress on this?

Quick Reads

Ben Evans has found a way to hack Facebook to show what apps are being used and hence what mobile devices users have. There is some good detail in the data – and the key story is that Android is growing faster than iPhone. And there is more growth potential in Android too – so that’s why Facebook is hiring Android developers really fast.

Google have launched a new app that showcases some of the best mobile ads. Right now it’s Android only, so another reason to beg, borrow or steal the Nexus.

Following the success of PingIt for Barclays the ability to pay by text will roll out to the other banks in 2014 – without the need to set up a separate account as PingIt does.

These are some good examples of mobile ad campaigns that worked.

The new edition of Think with Google is now out. There is a good section on mobile and a look at the ads that did best on YouTube.

Finally we spent this evening listening to Seth Godin talking in London as a promotion for his new book. With a sell out crowd, he spoke for over an hour and was as inspiring as usual.

The best quote?

We live in revolutionary times but we have forgotten how to see opportunity

Mobile Fix – January 11

Posted by Simon Andrews on January 11, 2013 None comments

This week lots of the ad industry has gone to Vegas for the Consumer Electronics Show. We’re not sure why people schlep there to wander around something like the Worlds biggest Currys store – but with even more annoying staff.  Seeing the latest hardware seems to miss the point that most of the innovation is now around software. The futility of the event seems best summarized by the Qualcomm keynote, which looks truly terrible.

Along with all the crystal ball gazing of 2013 predictions, we worry that this fixation with the latest and greatest gizmo is ultimately self defeating. Focusing on what’s next means you risk missing out on what’s already here.

In the last 100 days we have seen amazing new devices bought by millions of people – with the ‘old’ devices expanding the total reach of smartphones. In the US it’s estimated that 40% of homes now have tablets; wondering what will be the next big tablet seems less useful than writing a strategy to get your brand onto the tablets already out there.

Around half the population now have smartphones (and they are the half most brands need to reach). Around half of all social media users access Facebook and Twitter through mobile. And around half of all emails are read on mobile devices.

So our 2013 advice for brands is;

Park the future for the next few months and instead deal with the current ecology.

Make sure your marketing is truly Fit For Mobile. Over the next few weeks we will be sharing our Fit For Mobile audit which we have trialled with a couple of clients.

Lots of startups are looking to disrupt your industry. Do you know who the key ones are in your sector. Have you a strategy for how to benefit from these opportunities and limit the risks of new gatekeepers emerging?

As VC Saul Klein pointed out last month the average business in the UK is doing 8% of their business online – how do you do versus your competitors?

The latest Most Contagious covers loads of great marketing innovation – all delivered using the current ecology. Creative guru Steve Henry calls out some of best examples here. How does your marketing compare?

When you have got all this sorted, then you can start thinking about driverless cars and watches that act as phones.

Old media not dead yet.

New new thing myopia can also lead people to forget the strengths of traditional media. As this reports shows most old media business did very well in 2012 – with surging share prices – largely driven by the fact that money hasn’t followed audience. One of the ironies of this is that a lot of the money being made by old media is from selling access to new media – as the TV players still control lots of broadband access from the days they were selling the triple play – TV, Broadband and Telephone.

One of those three legs is very shaky as people move from landlines to mobile and the opportunity to sell expensive broadband is probably closing too. Not least because people like Google are getting into the business – launching a service in Kansas offering a service 100 times faster for around twice the price of ‘traditional’ broadband. They also offer a slow service – the same as the competition – for free.

Most media businesses have a strategy for how to evolve in a digital world – and  some actually seem to be working – so for brands the opportunity is to get the best of both worlds. And you do that by focusing on the here and now, rather than the now and next.

Santa delivered for some retailers

As the sales figures for the Christmas period come out it’s clear that the high street is a tough place right now. We were interested in how online sales have been a defining factor for lots of sectors. John Lewis were a clear winner - with online sales up 44% year on year and now accounting for a quarter of all sales. Debenhams online sales grew by 10% and now account for12% of all sales.

In the supermarket space the proportion of online sales continues to grow – Sainsbury online sales grew by 15% masking the poor performance in their stores and players like Morrisons who don’t have online (yet) are suffering.

The big problem that traditional retailers have to wrestle with is that online sales can be much less profitable. In Grocery most people accept that a delivery costs around £20, yet most customers pay around £5, if they pay anything. Some argue it’s a business model supermarkets like Morrisons should ignore.

eBay report their figures next week so we’ll see how the pure plays did – and an analyst expects that mobile will be around 16% of the total sales at $10bn.

Amazon is reported to be doing 8% of their sales on mobile – which seems low to us.

Nexus 4 As good as the iPhone and half the price.

One of the key devices launched in the last 100 days is the Nexus from Google (and LG). With a great spec and a great price, the sales of these devices was not handled that well, with the product coming in and out of stock and delivery dates a little opaque.

But the phone itself is very impressive. It’s had great reviews and we tend to agree with this former iPhone lover who is swooning over the Nexus 4. Is it better than the iPhone? Not so sure. But there is not much in it and it’s half the price.  We still tend to carry the iPhone around, because lots of apps aren’t yet available on Android. But that is changing. Fast.

We’re convinced that the Nexus5 – which we think will come from Google owned Motorola – could be a real game changer. They just need to get the retailing bit right.

And one of the reasons we switched to Android is to try Google Now – which is really impressive. An app that anticipates your needs is quite compelling; transport advice on how to get to the next meeting, share prices when stocks on your portfolio move, the weather forecast and by how much Leeds are losing. All ‘pushed’ to you.

The next generation of this will be amazing. We are seeing apps evolve into real services.

And Field Trip – another Google app – is also very cool; it throws up information on interesting places around your location – and will now include offers from ScoutMob. An iPhone version is on the way.

OK – some trend thinking

In amongst the shiny object hype, there is some good thinking out there on how 2013 might shape up;

The smart people at Deep Focus in New York have a really good deck out with their forecast for 2013. Their thinking on the ‘Confluence of Mobile, Social and Content Marketing’ makes a lot of sense.

PayPal have some good observations from their CEO – and we love their recognition that paying for stuff is not the problem that needs solving – it’s about the context of the transaction. Hailo works because it gets me a cab – not because it’s an easier way to pay the fare. Starbucks works because it gets me my double espresso quicker – not because I can pay for it with my phone.

John Battelle is one of our favourite thinkers and his predictions for 2013 are based on what he hopes to see.

Fast Company has collected the thoughts of some of tbe best strategists on how marketing will change in 2013. We loved the views of ex P&G CMO Jim Stengel

We will drop social from social media as all media is social; we will drop digital and mobile from digital & mobile marketing as all marketing is digital and mobile; we will drop advertising from advertising agency as their future is in helping clients creatively realize opportunities; we will drop global from global marketing officer as all marketing leaders need to be global in thought and intent.

And the Frog Design people get into the more futuristic stuff here.

Quick Reads

The Wall Street Journal has looked in depth at what 2013 might mean for GAFA. A must read.

Facebook continue to pioneer measuring the effectiveness of digital. They are doing some fascinating work with Walmart.

Ad blockers are still active. In France the Government had to tell ISP Free that they can’t block ads. It seems that Google ads were the target as operators look for a share of the revenues earned by people using their dumb pipes.

eConsultancy research shows brands see mobile optimization as the top priority for 2013 – we agree and our imminent FitforMobile audit should help here.

Finally  – one of our house IP projects is launching but still in beta. We have been working on a social business aimed at facilitating communities. SkratchMyBack.com is a service that connects people with some spare time and skills with people who need a bit of help. It is still a little raw but we’d love your help on getting this working. Have a look and sign up, tell your friends and let us know what you think.

And next Thursday we’re going to see Seth Godin who is in London to talk about his new book. If you are going to be there let us know.

Mobile Fix – December 14

Posted by Simon Andrews on December 14, 2012 None comments

With Big Data (ok, the Metro iPad app) suggesting this is the day our readers are most likely to have a hangover, we’ve gone easy on the reading matter and gone heavy on video.

So if you are feeling delicate post party, you can sit back and soak up wisdom.

Google have shared what the world has been searching for in 2012, and promoted it with this charming video. The full data is here.

Larry Page the CEO of Google has given an interesting interview that is worth reading. One quote stood out;

We’re still 1 percent to where we should be.

Lots of people would argue that part of the 99% progress still to come is to sort out their ecommerce capabilities. The sales of the Nexus 4 and Nexus 7 from Google Play have incensed lots of people as they are getting no feedback from customer service on when, or even if, they are going to get their orders.Given we have a Nexus 4 and a Nexus 7 on order as Christmas presents, we share the frustration. The thing is Amazon have set the bar for customer service so high.

One piece of good news for Google is that their native Maps app for the iPhone is now out and getting rave reviews.

The Apple CEO has also been talking to the press and one of the topics covered is the maps debacle.

The killer quote from the Tim Cook interview is;

Eighty percent of our revenues are from products that didn’t exist 60 days ago. Is there any other company that would do that?

One thing that the interview doesn’t get into is Apple TV. One of the best analysts is confident we’ll see it next year. This video predicts Apple TV and more phones, more often — including a cheaper one (under $200) by 2014. But if Jonny Ives were to fall under a bus – or get hit by a driverless car – things could be different. The charts from the presentation are here.

Whilst eBay and PayPal aren’t quite at GAFA level they are driving significant innovation and this interview with the CEO of PayPal is interesting stuff.

One of the topics we have been covering with clients quite a bit is the annexation of marketing by tech companies. Adobe has been buying marketing services firms, as have IBM, Oracle, Google and Salesforce.

So this interview with Michael Lazerow , the CEO of Salesforce is well worth watching. He mentions that;

Sales Force works with over 400m data points and their goal is to integrate marketers customer service, advertising, social and analytics to provide a single customer view which can be acted on. Successful companies in this space have to blend the science of data with the art of marketing.            

As these guys are close to the CEO and board of their customers, it does suggest agencies need to reframe their abilities if they are to get the attention of the decision makers at brands.

If you are still in a lean back mode, it is worth having a play with a new iPad app that we have been helping A&N Media on. Whirrld is a very cool way to discover what is popular all around the world. You can see what music, books, films, videos etc are trending in each city.

If you aren’t feeling too delicate, here is some more meaty stuff to absorb.

Firstly an apology. Last week the email gremlins broke the link for the new Mary Meeker deck – which is a must read; this one does work.

Ofcom have released a new study showing the UK is the most advanced market in the world for mobile, newTV and ecommerce. Are you making the most of this?

Fred Wilson has taken a good look at revenue models and advertising. Really useful thinking.

And the FT has focused on Big Data, with a number of very insightful articles.

This is the last Fix of the year and we’ll be back in January with our big picture view on 2013. If you want some trends in the meantime this deck from a smart friend is a good read.

Finally – last weeks offer of a free workshop got a good response and we have a number of sessions booked with brands. And we’ve been invited in by teams at Google and Facebook. But we still have some free time so if your team could use some provocative thinking about mobile and social, let me know.

And finally, finally we wanted to share our Soulful Christmas playlist with you. We find it goes best with a large glass of New Zealand Pinot Noir. Enjoy on Spotify

Mobile Fix – November 30

Posted by Simon Andrews on November 30, 2012 None comments

So we’ve all read the memo. Mobile is mass market and it’s a machine for making money.

We’re now much less interested in stats about what % of people have smartphones etc. In most key markets the majority of economically interesting people are embracing the new behaviours that mobile enables.

The important thing now seems to be how brands are taking advantage of these new opportunities.

With the start of the holiday shopping season last week we see continued growth in mobile. IBM data shows that in the US online sales were up by 21% on Black Friday – with the mobile share up significantly. 24% of consumers used a mobile device to visit a retailers site – up from 14% last year.

All those brands that haven’t got around to developing a mobile site can breathe a little easier, as it’s tablets that are the main devices used for mobile purchases – so the desktop site works OK for these users. But there is a little bit of chicken and egg here – if more sites worked on smartphones we believe we would see more mobile sales. The bounce rate of c40% for mobile devices backs this up.

One stat that has caused some excitement is that the Twitter referral traffic was exactly zero. Cue lots of people saying social doesn’t work; but do people really tweet about retail stores?

The smart players have invested in mobile friendly sites and data on Cyber Monday shows this is paying off. eBay mobile sales doubled on the Monday compared to a year ago and Paypal volume almost tripled. Amazons sales were up 42% on the previous year.

Given the economic climate in the US is still pretty grim, this growth has come from someone else. Comscore says that online sales on Cyber Monday were around $1.5bn. So some retailers have lost a huge chunk of sales to the big boys; it will be interesting to see who the victims were when we get data on q4 sales.

Native vs Banners

Our look at natïve advertising last week has prompted some interesting conversations. And there does seem to be a growing number of people suggesting the banner is dead – or at least dying. Again, we’re not convinced; we believe we will see a wider variety of formats but the banners still have a place.

Just to up the pressure on the industry to find mobile ad formats that work, a mobile version of AdBlocker is about to launch. This can block all ads in the browser and within apps – apparently including Facebook. The desktop version is used by over 50m people.

QR Codes are still alive & kicking

Whilst the cool kids don’t like them, QR codes continue to get traction with clever brands. P&G tend to think their marketing through and are pushing QR codes on print advertising for their shampoo brands and Gillette. And this use by Toyota is well thought through too.

Of course a perfectly viable marketing tactic is let down by people using it badly – this econsultancy article points out many of the errors people keep making.

Our mobile site Quite Easy Really is designed for anyone to use with a QR campaign – explaining what the tech is about and linking to QR readers to download.

Bubble (Part2)

Last week we considered whether we were in a bubble with tech valuations so high. New York VC Fred Wilson has a typically smart look at why VC funding of consumer web and mobile companies is down 42%. He points out that digital is now 20 years old and behaviours are getting fixed – making it harder to create space for new businesses.

And with mobile it’s now more expensive to launch a business – because you need to develop for the web, iOS and Android. And having achieved a download, it’s hard to keep people using the app. Business Insider points out that formerly hot apps SocialCam, Viddy & DrawSomething have all seen huge falls in user numbers – by up to 95%

There is something of a shift to enterprise too, but the key point is that

…the first two factors are also making it harder for consumer internet companies (web and mobile) to breakout which is more and more a prerequisite for funding

We’d argue that part of the problem is that start ups have given up on marketing. It’s easy to find startups talking about the product being the key thing and really hard to find ones that see that smart marketing may have a role to play. In some ways this is a reaction to the dotcom boom, when we spent most of our time talking to naïve entrepreneurs wanting to put their poorly thought through dotcom business on TV. In both London and New York ad agencies became adept at transferring VC money to the TV companies, as start ups thought a wacky TV ad was the way to go.

But the better mousetrap thinking is equally naïve. With so many people coming up with similar ideas a great product isn’t enough. Digital marketing is so much more powerful these days; maybe online and mobile advertising have a role to play in driving adoption and usage?

Quick reads

* Our friend Neil Perkin has a really interesting look at the challenges and opportunity for Facebook.

* Marissa Mayer has given her first interview since joining Yahoo and obviously she talks about Mobile

This is a huge opportunity for us because we have the content and all the information people want on their phones

* We learnt lots at an interesting lunch with Comscore today. One thing is now public, with a new service enabling us to see how people are using US sites by platform. For example the data shows that Google has 211m users in total – with 189m on desktop and 109m on mobile. Really interesting to note that Yahoo has 95m mobile users – second only to Google. We look forward to seeing the European data.

* Interesting thinking on the need for agencies to change from NY agency Deep Focus. Love the Clay Shirkey quote;

“Institutions will try to preserve the problem to which they are the solution”

* With Android growing really quickly it seems Apple is finally going to adopt the Nano strategy and launch a much cheaper device.  The Nano strategy refers to the way Apple launched a much cheaper iPod and destroyed the competition.

* Chinese brands are producing smartphones at lower price points and taking significant market share in China. Gionee sells more than HTC and Lenovo is outselling Apple and closing on Samsung.

Finally….. Mary Meeker has a rival. Whilst her decks have been the go to source of good data on all things digital and mobile, the Business Insider deck on the future of the Internet is really good too.

Well worth spending 10 minutes flicking through. Then take a few minutes to think through how this affects you.  Are you poised to win in this new world, or could you be one of the losers?

And we’re on the road, speaking at the Millward Brown Conference next week. If you are there do come and say hello.

Mobile Fix – November 23

Posted by Simon Andrews on November 23, 2012 None comments

What’s the future of advertising?

Building on our thoughts last week on the emerging ecology of native advertising, we enjoyed this talk from Fred Wilson and Dave Morgan. They discus what’s happening in digital generally but get into some detail on how advertising is changing.

At one point Wilson answers a question by stressing that platforms with big audiences can and do monetise with advertising. He reminds us that Facebook is a success (with a huge valuation, $5bn in revenue and good profits) that Twitter is a success and believes Tumblr will be too.

The video is 45 minutes but well worth watching.

We agree that the money will follow eyeballs and ad revenue can fund these new businesses, but exactly what advertising will look like is not yet clear – particularly on smartphones and tablets.

Many think that it won’t be banners, but we see a place for them. Done properly – relevant creative and smart targeting – they can and do work. Both for response and for branding.

But the idea of brand messages that blend with the surrounding content has to make sense. In traditional media the advertising has adapted to it’s environment and feels native. Facebook sponsored messages and sponsored tweets are working well, as they are clearly native. As is paid search on Google. And each of these formats makes the transition to mobile easily.

Does this trend mean the comeback for Branded Content? We launched Big Picture back in 2005 to focus on branded content and branded utility, but this never got much traction then and we spent most of our time on mobile and social.

But as this interesting article points out, Content seems to be king again, and lots of brands want to be part of the content people enjoy, rather than just interrupting it. With technology driving the context and content production costs falling, we see this area growing quickly.

As Real Time Buying disrupts how advertising is bought, we do see that change can happen really quickly – emarketer suggests RTB will grow from $2bn this year to nearly $8bn by 2016 – 28% of all digital display. The New York Time has a thoughtful piece on The New Algorithm of Web Marketing, including this quote from emarketer;

publishers were “going to have to double down to prove the value of their inventory as they compete with other, cheaper inventory.”

This innovation doesn’t just change the role of publishers – it can change the role of the media buyer too. This 4 year old article about a former boss, shows how agencies were thinking about the opportunity of data;

As far as Gotlieb is concerned, the rules have changed. In a world where ads can be customized to the individual and every click and ad view measured, he says, advertisers and media companies alike will gladly pay for his quantitative expertise. In five to seven years, he predicts, he may not represent advertisers at all. He will be an arbitrageur, buying ads in bulk, slicing them up for niche audiences, and reselling them at a premium. “Then,” says Gotlieb, “we don’t have to be transparent.”

Of course if we don’t use the technology to make advertising work better, people will use technology to make advertising disappear. A new ad blocker service is doing very well on Kickstarter.

But as Fred Wilson points out, it’s a myth that people don’t like advertising. Most people enjoy advertising that i relevant to them and well made. The stuff they hate is untargeted, uncreative ads – so it’s in everyone’s interest to solve this conundrum.

Measuring the effect of ads

Probably the deciding factor in whether or not native ads get real traction is whether they are seen to be effective. Online made life difficult by latching onto clickthrough as a key metric early on. As clickthroughs declined it has been hard to get the industry to pay attention to all the other research that shows online is really effective. In mobile we risk history repeating itself as click rates get talked up.

Facebook continue to lead the charge on digital ad measurement. Their scale and the data they hold on their customers gives them some huge advantages. We were told of a device manufacturer who was able to see what handsets were being used by the people who saw their ads (aggregated)– and compare that with fresh data a couple of months later. So they had clear data on how many people had changed phones over that period and how many had bought their brand.

Techcrunch has a good look at how the research works – and Business Insider has a linkbait headline saying this will kill Yahoo. On the contrary, any evidence that digital advertising works can only drive more investment in digital – and Yahoo is as likely to benefit from that as anyone. If you want to dig a little deeper into ad measurement Adweek have taken a look at mobile tracking.

Social is evolving

As social becomes recognised as a valid marketing tool we are seeing a more sophisticated approach from many. New York agency Deep Focus has reorganised their social team and launched a Newsroom for social media. They key thing here is a much faster pace – with ideas being executed within a day.

And a smart friend is using social to build the profile – and salary – of Hollywood celebrities. With partners like Sean Parker and Ari Emanuel, this looks like a great business.

But there is still quite a lot of froth around social, which this Onion video nails – Using Social Media to cover for a lack of original thought.

NewTV

A YouTube executive has been talking up the Google view on NewTV and how they see YouTube as a TV platform. The comments on their ad innovation TrueView – where viewers can skip the ad after 5 seconds and the advertiser only pays for viewed ads – are interesting;

“We found TrueView to be effective for advertisers because they now only pay for views. It’s great for consumers because they can choose, and it’s great for content creators because the [revenue] that a content creator takes from a TrueView ad is higher than for a reservable pre-roll. Advertisers are paying for a particular audience or content type.”

In another interesting innovation Amex have invested in interactive TV in the US. With the rise of SmartTV and the ability to deliver apps onto TV, we are going to see more of this experimentation.

Bubble?

The Facebook IPO caused a few people to question the huge valuations being given to startups, and for the first time for while, some people suggest there is a bubble building up. Foursquare is the latest whipping boy but a number of ecommerce businesses are seeing down rounds – when new investment comes in against a lower valuation than previous investment.

We have wondered why starting a relatively straightforward ecommerce site makes a business so valuable. Especially when Amazon could enter your niche and probably crush you.

And even in London, some are wondering how viable many of the Silicon Roundabout startups are; we heard a smart commentator say there are too many people building useless apps, rather than real businesses. This article looks at how the app boom is proving tough for lots of wannabe entrepreneurs.

As we always say, to be successful you need to solve a problem. And a lot of the problems have been solved now. But we do agree with Marc Andreessen when is says we are not in a bubble;

“Tech stocks are trading at a 30 year low when compared to the multiples of industrials” Andreessen says “It’s the weirdest bubble when everyone hats everything”

Quick reads

Operators are starting to get their act together. Following on from Weve, we now have Orange partnering with Facebook to offer group calling – essentially being able to chat with your friends on Facebook .

Amazon now offer brand pages – so we could have amazon.com/addictive. So you can now start a business and have Amazon handle pretty much everything – including the site – leaving you just to find the customers. Maybe this is what all the cash strapped ecommerce businesses should do.

One ecommerce business that does seem to have a viable model is GiltGroupe. McKinsey have taken a look at how they are using data, mobile and social.

Over the past few months we have been playing with Banjo, Glancee, Highlight and some of the other people discovery apps. Notifications that say Facebook friend X is near you don’t seem that compelling – but you can see that a refined version could have some appeal. Just as Foursquare hasn’t gone mass market – yet – we do see that location has some way to go before it’s the next big thing. But as context it has to be valuable – in some way. This is a good round up of the key players.

If you have an hour to spare, it’s worth listening to this talk by Martin Sorrell, where he gets into the detail behind the WPP strategy. Interesting and entertaining too.

Finally  – when talking with brands we always talk about the disruption caused by the web in their sector – which took 15 years to play out – and make the point that mobile disruption will happen much quicker. Why? Because the installed base is already huge and new behaviours are already becoming embedded. Forrester now make a similar point;

However, mobile has the potential to be more disruptive than the Web. The mobile revolution will inevitably transform your business in the next decade, too —not because mobile will generate massive direct revenues but because it will trigger a more radical transformation toward systems of engagement.

Mobile Fix – October 12

Posted by Simon Andrews on October 12, 2012 None comments

 

 

 

Next 5 years

As we learn that mobile ad spend in the UK should exceed £500m this year, we found some futurology from AdAge very interesting; what marketing will look like in 5 years times.

The suggestion is that the trends we have seen over the last few years will really shake up marketing. We have been arguing that both the technology and the consumer behaviours are going mainstream very quickly.

The article is well worth reading and the action points make really good sense;

Up your mobile spend now so you can test and benchmark in the future

Hire the right people so you can start thinking of TV investment as a data play, if not a direct-response channel

Get out of the mindset that reach and awareness are enough and don’t use models that fail to build in room for experimentation with new channels

Agencies, open the kimono on costs. Marketers, don’t assume your agencies aren’t open to new compensation programs. Both need to get on the same page when it comes to metrics. But don’t be cheap

Hyper-bundle. Think broadly about user experience and designing all consumer interactions as a user-experience expert would.

Pilot integrations of IT and marketing. Start small, with a single product or service

 

 

 

 

 

 

 

 

Next 10 weeks

In our presentations over the past few months we have been illustrating the momentum of mobile by looking at the big changes to the ecology we expect by Christmas – just 72 shopping days to go.

The iPhone 5 is out and selling really well – and the 4s price has dropped so more people can afford an iPhone.

The next big Android phone is probably going to be the Nexus from our former clients at LG – early reports suggest LG have got their mojo back and this is going to be a great device.

On tablets we will have the KindleFire from October 25th. The Nexus and the Samsung Android tablets seem to be selling well. And we’re just days away from the iPad mini – and the iPad4. Both will use the new Lightening Connector and will be on sale by Christmas. So Santa is going to be delivering lots of tablets this year – validating the OFCOM data showing 11% of the population have tablets and 17% expect to buy one within a year

But as well as all these new devices, we’re also going to have 4G. Everything Everywhere launch their service at the end of the month and, with the auction pulled forward all the networks will offer 4G in the first half of next year. Free WiFI is becoming ubiquitous too – most coffee shops offer it and many retailers are making it available

Whilst the iPad mini will probably be WIFI only ( like the Kindle Fire) the iPad 4 and the new iPhone will utilise 4G and the impact of the extra speed will be a gamechanger. The BBC did a test showing that 4G can be 10 times faster than 3G

So millions more people will have powerful new devices and faster connections. Blend that with the innovations in mobile services and content and it’s clear the pace of change is going to get even faster too. Interesting times.

Right Now

The news that the UK mobile adspend will exceed £500m is great news. It is still hugely biased to search, and consequently response focused, but as brands see the ROI from this spend, growth will accelerate.

Of course, many people struggle to deal with the  dynamics of the current market, with the majority of brands still missing out through not being Fit For Mobile

The Chief Marketers Officer Council say that 47% of their members are dissatisfied with their mobile efforts – blaming a lack of resource and talent.  Just 14% are happy with the results of their mobile activities. A new Forrester survey shows most brands are spending under $500k on mobile – with the result that;

.. eBusiness professionals lack the funding they need to build mobile services, integrate mobile services with their back-end infrastructure, and build out teams with the right skills in-house

One of the key findings of the Forrester study is that many clients are taking mobile inhouse  – which is backed up by an article in Adweek. This makes lots of sense as mobile will be key for most brands and over time they need to take ownership of their mobile assets – just as they have with their web presence.

“It’s so integral to the brand that you own your destiny in mobile,”

Having builders in house who can update your mobile and social assets is only part of the issue though. We believe most brands still need smart thinking on how their market is changing and what the threats and opportunities are.

But getting good advice is hard in a market that is largely populated by vendors selling whatever their factory or platform provides as the solution –whatever the problem.

So we see a role for architects – experts who really get the market and consumers, as well as having a deep understanding of mobile. Architects can determine just what the builder should actually build for maximum strategic benefit and for ROI.

Which is why we’re structured as we are – smart thinkers in house who really get people, marketing and mobile and a partnership with great builders. This model has worked incredibly well for us over the last 10 years – on all sorts of projects from websites to brand funded TV shows to desktop apps before they were called apps. It’s perfect for today.

And this approach enables us to build robust business cases for the investment needed (internally and externally) to profit from mobile.

GAFA

Google continue their sterling efforts to drive mobile investment from brands with an update of their Mobile Playbook. Lots of good data and smart advice – including a focus on the need for great creative work. And Google continue their push into content with the roll out of their premium channels on YouTube - 60 new channels of content commisioned from suppliers like the BBC and Endemol. And the guy behind this move says “This is the first screen, so when you talk about second screen, you are talking about the television.

The testing of the Facebook Want button is an attempt to harvest the intent that Pinterest captures so well  – and will allow Facebook to monetise that intent through ads and eventually ecommerce.

Passbook from Apple is a clear attempt to create a service that offers huge utility for both businesses and consumers – and potentially make it harder to switch from Apple to Android. We have seen some UK brands (Odeon and Harvester) sign up now and a trial for the Baseball League in the US was a big success.

Our friends at Econsultancy have a good look at why Amazon is being so successful with mobile. And following the launch of the Amazon Media Network an interview with their head of Advertising describes the thinking behind the move into ads

Quick reads

Will Apple buy Twitter?

Gartner have forecast stellar growth for SoMoLo services

Business Insider have a great set of slides with data on the state of the internet – with lots on mobile and social obviously

Atooma is a great example of how apps are becoming smarter

No real surprise but Mobile is key to the reinvention of Yahoo

Si Cross from Facebook has shared insight into the Facebook view on HTML5 – as he puts it Facebooks problems are not everyones problems

Finally …we’re out and about, doing more speaking. This week we spoke at the CMA on native and HTML5 apps and next week we’re talking at the World Media Group Digital Communications day. Also on Tuesday we have the next MMA  Breakfast Briefing  - where the speakers include Xbox. If you are a brand, we can get you a free ticket – just let us know.

 

Mobile Fix – September 28

Posted by Simon Andrews on September 28, 2012 None comments
Publisher disruption

We were asked this week which verticals were showing the keenest interest in mobile. Now everyone has read the memo, most people know mobile is huge and still growing fast. But it’s those businesses that can already see real disruption that are moving past conversations into doing something. They recognise that – just as we saw with digital – there will be winners and losers, and that doing nothing puts you firmly in the potential losers pile.

So retail is a key sector and so is publishing. Someone from the Guardian recently tweeted that around 40% of their traffic is now mobile – and that’s only going one way. This week the Mail shared some stats showing that around a third of their daily visitors come via mobile. Most publishers have already evolved once or twice for digital and are now looking at further shifts.

But the publishers this week have come out and blamed agencies for the slow growth of mobile advertising. Which seems a little harsh. There are still agencies that treat mobile as an emerging media (dealt with by one man and a dog eared Mary Meeker deck), but most of the good ones are now taking it seriously – witnessed by the number of agency people who subscribe to Fix.
When you dig into the research there are two key issues – price and creative.

On price, publishers blame agencies for paying too little and being overly keen on ad networks. This is largely that the industry has yet to articulate the value of mobile advertising; only when we understand how mobile drives both brand and response metrics will prices rise. And publishers need to demonstrate that context is valuable – ie that reaching a new York Times reader when he is reading the NYT is more valuable that reaching the same person when they are checking their email or in a third party app. We’re working on a research initiative around this, so watch this space

On creative too many brands are outsourcing mobile creative work to the publisher, with the result that they have different messaging running on each network – with the idea watered down. Just as we eventually learnt in digital, effective mobile advertising requires dedicated creative talent, with real brand insight as well as deep understanding of mobile.
Traditional agencies struggle to make money on mobile and their business models favour doing more of the same, as the margin on a complicated mobile programme costing £250k is the same as booking one spot in the middle of X Factor. So specialists will thrive.

As we keep stressing, everyone in mobile is in the ad business – operators, device manufacturers, brands and agencies rely on content to get people to use their smartphones. If the creators of content can’t get paid, then the flow of content we rely on to read, share, comment on and advertise within, will dry up. We all need to fix the model where the value of content in print worth $100 per thousand drops to $10 in digital and just $1 in mobile.

Another key issue within publishing is how mobile offers new ways of delivering their content – but these tend to be expensive. As well as the spiraling cost of producing native apps for proliferating platforms and devices, it is expensive to enhance the format of content with video and interactive content. We did some consultancy for Yahoo last year on who is getting tablet content right and looked back at the early promise of tablet magazines.

Our friends at Wonder Factory produced a great concept Video for Sports Illustrated.  But if you look at the digital edition of Sports Illustrated now, it’s quite underwhelming.
Viv magazine produced a wonderful concept video around the same time. They said Viv Magazine is a good example of what magazines could look like on the iPad. The magazine features beautiful motion graphic transitions when you flip between pages. It gives you the feeling of reading a book while the background sets the overall mood. But the iPad version now is virtually the same as the print title

Publishers need to find affordable ways to take advantage of these new opportunites. And advertisers need to find new ad formats that will fund these innovations. So publishers and agencies must work together, rather than point fingers
 

Retail Disruption

In retail people are seeing the effect of mobile really clearly

On the up side some people are seeing really good sales on mobile. Dominos reported this week that 18% of their sales are from mobile. And we saw a while back that Ocado get 24% of their sales on mobile.

On the downside showrooming is now mainstream. New research from econsultancy says 47% of UK shoppers have used their mobile phones to compare prices and read reviews whilst out shopping. Ofcom data has 57% of smartphone users doing similar whilst shopping.

Given how tough it is on the high street, we think those brands that get this right have got a chance, whilst those that don’t may not make it to the January sales.

In the battle for sales retailers are using lots of different tactics but most seem to involve discounting – and most mobile campaigns are delivering money off vouchers. The rapid growth in all types of promotions has got us to the point where Peter Kerr of the Institute of Promotional Marketing says;

…it would be “commercial suicide” if the use of conditional spend vouchers and promotions continues at the current rate

Booz and Co have some interesting thinking about how Sales Promotion is being misused by many – encouraging price comparison and weakening the brand. As they say

The most effective promotions tend to be targeted to selected customers; such promotions include “friends and family” events, loyalty club discounts, and other discrete efforts to reach particular groups.

To us, this is the real opportunity for mobile. Leveraging the opportunity to develop a dialogue with customers, mobile can be used to deliver discreet messages to specific groups. And whilst they may still be focused on discounts, this way is less corrosive to the brand than vouchers on Money Saving Expert every week.

It’s worth reading the econsultancy repoort which looks at all the digital tools available to high street retailers.

Every retailer knows that Amazon and eBay are poised ready to eat their lunch – and the momentum is accelerating; eBay have had 100 million items listed on mobile and had 100 million app downloads
 

Google vs Apple

As (what the FT call) the Apple maps fiasco continues, Google have stated they are not rushing to produce a native Maps app. Why would they? As we pointed out last week it is very easy to use the Google Maps in the browser and add an icon to the homescreen. Tadah – you have a Google Maps App. This solves a consumer problem and a business one – so we expect to see Google marketing this webapp aggressively.

Eric Schmidt has told journalists that they have done nothing about a native app. Why? Because the appstore Ts&Cs preclude people publishing apps which duplicate key features of it’s devices. So just as you can’t launch your own version of itunes as an iPhone app, it would seem likely you can’t launch a maps app. Unless Apple say so.

Eric says Google and Apple are in constant communication –at all sorts of levels – but wouldn’t be drawn on the maps issue or whether Google will continue as Apples search partner. In our view there is no way Apple are going to give Google anything.

We mentioned last week that GAFA are starting to look at content plays and the FT builds on this with a look at why Apple may see content as attractive. This month we are seeing a major step from Apple – the iTunes Festival concerts they have ran as promotion for customers for the last few years, are now being broadcast through iTunes.

As GAFA recognise that content is the best way to differentiate their walled garden, we will see much more of this.
Quick reads

Great blog post from a smart analyst on why NFC is a solution looking for a problem. We still think that mobile money is a big opportunity, but it’s the context that provides the value – not the actual payment. In Hailo the value is around getting the cab. In Starbucks it’s the ordering that matters.

Google have more good research on why a mobile site is a good idea – because people are more likely to stay on the site and more likely to buy.

Great interview with Mary Meeker – and hardly a stat to be seen.
 

Finally…..we moderated a fascinating panel on connected TV today. With a very smart bunch of people from Agencies, Operators, Device manufacturers and UX experts we got into the hugely complicated world of newTV. One thing everyone agreed on is that the Broadcasters are still major players because they have the content that people want to watch. This thinking is supported by the news that Zeebox has secured investment from NBC; the only way the second screen experiences can build significant audiences is if the broadcaster drives viewers to them.