Every year, mobile consultant Chetan Sharma polls mobile industry executives, developers and insiders on their predictions for the upcoming year. The survey’s latest edition suggests that the growth of mobile data, mobile payments and the struggle between Apple and Google will again be key story lines in 2013. For the third year running, mobile payments was identified as the “breakthrough category” for the year ahead, followed by mobile cloud services and mobile commerce. Last year saw big moves in the space by Square, through its far-reaching partnership with Starbucks, and PayPal, which introduced its own mobile payments system for merchants and expanded mobile wallet trials with U.S. retail chains. While Apple and Google and their respective iOS and Android platforms are again expected to dominate the mobile landscape in 2013, the survey points to Samsung and Microsoft as third players that could make noise this year. After becoming the largest device mobile phone maker in 2012, Samsung was also named mobile company of the year for last year as well as 2013. The South Korean consumer electronics giant was picked as the company to launch the most successful mobile gadget in 2013, edging out Apple. Samsung was also cited as the most important industry player overall behind Google and Apple and ahead of others including wireless operators, Amazon, Qualcomm and Facebook. Microsoft, meanwhile, is the company expected to make the biggest mobile acquisition in 2013 as it tries to gain ground against rivals Apple and Google. With the launch of Windows 8 phones in 2012, the survey also pointed to the Microsoft platform as having the best shot at emerging as a viable third mobile ecosystem beyond iOS and Android. The report also showed that a majority of the panel believes m-commerce will eclipse e-commerce by 2015 in North American and Asia and by 2020 for the rest of the world. Figures from IBM showed that U.S. mobile purchases during the holiday season increased to about 16% of total online buying, up from less than 10% a year ago. So despite healthy growth, there’s still a long way to go for m-commerce to overtake e-commerce. Among other predictions for 2013 are heavily rumored developments, including the debut of an Apple television, an Amazon smartphone, and a Microsoft-made smartphone. Industry insiders also project the arrival of data-only plans and for struggling Nokia to adopt Android as a smartphone operating system. For this year’s survey, the firm’s sample included people representing app developers/entrepreneurs (29%), infrastructure providers (11%), device makers (10%), mobile operators (10%), content/media companies, journalists/analysts (6%), specific industry sectors (6%), corporate suppliers (4%), and “other” (16%).
Beyonce fans who want to be part of her Super Bowl Halftime performance can warm up their smartphones for a series of photo assignments from sponsor Pepsi. In a promotional run-up to the Feb. 3 event, Pepsi is asking fans to snap and upload images of themselves in a series of specific poses that will be used in the on-air intro video as the singing star takes to center field. The mobile-optimized Pepsi.com/halftime site is rolling out a series of photo poses until Jan. 19. The poses include head bopping, feet tapping, and hip shaking. The images can be uploaded with the accompanying #PepsiHalftime hashtag to also be entered in a contest that will send 50 winners to the live Super Bowl performance in New Orleans where they also will be part of dress rehearsals and an on-field dance team. Pepsi announced that just a few days into the promotion it had already received thousands of images from users. Pepsi started promoting the effort last weekend on Times Square billboards. The marketing is also being localized for New Orleans, where another 50 winners and their guests from Pepsi retail partners in the area will go to the live event.
Citing recent feedback from marketers on its mobile and news feed ads, as well as its “ability to leverage third-party data” through the Facebook Exchange and its custom audiences platform, J.P. Morgan this morning raised its price target for Facebook 21% to $35 per share from $29 previously. “We believe Facebook's advertising revenue will accelerate at least through [the first quarter] and we are raising our advertising estimates 6% to 7% for 2013 and 2014,” Merrill Lynch analyst Doug Anmuth wrote in a report to investors this morning. The report reiterates Merrill Lynch’s “overweight” rating for Facebook shares, and is especially positive on Facebook’s progress in developing a mobile advertising infrastructure, as well as the momentum of its ad exchange. “Our checks suggest positive advertiser feedback around news feed and FBX ads,” reads the analyst’s report, noting that Samsung utilized Facebook ads as part of its launch campaign for its Galaxy S3 smartphone, which generated “$129 million in sales attributable to Facebook, delivering an ROI of 13 times on Samsung’s $10 million of Facebook ad spend.” The report also singles out Pepsi’s use of Facebook advertising, including “measurement of in-store purchasing activity showing strong correlation for those users exposed to Pepsi ads on Facebook. “We believe Facebook played a bigger role in e-commerce this holiday season, and Wal-Mart appeared to have significantly increased its ad spending on Facebook,” the report continues. “We are raising our mobile news feed estimates in our bottom-up ad model to $2.37 billion in 2013 and $4.0 billion in 2014, up from $2.0 billion and $3.3 billion previously, and we expect mobile to surpass desktop ad revenue in 2014.” While showing some positive uptake among advertisers, the Merrill Lynch analysts estimated that the Facebook Exchange still currently accounts for less than 10% of all of Facebook’s “right rail” display ad impressions, “suggesting significant headroom going forward. We believe FBX ads could also appear in the News Feed over time based on their high click-through and conversion rates.”
Fab.com has quickly carved out a niche online selling a range of quirky home and fashion items from the Beardo to plaid serving spoons. Launched just 18 months ago, the online design store has amassed 10 million members already and posted 600% sales growth over the last year. Playing a big part in Fab’s rapid emergence to date has been mobile. A slideshow posted by Fab CEO Jason Goldberg highlighting company benchmarks in 2012 points out that a third of its sales came from mobile devices (phones and tablets) this year, and more than half (56%) on Christmas Day in the U.S. It previously reported that 40% of sales on Thanksgiving came from its mobile apps. Compare that to figures from IBM showing that Black Friday online sales via mobile overall increased to 16% this year from 9.8% in 2011. Fab still had more than twice that proportion in mobile sales last year. The company’s focus in mobile is on its apps. Both the iOS and Android version of the app have earned four and a half out of five stars, with reviews posted to the App Store indicating that Fab has developed a devoted following. Looking ahead to 2013, Goldberg has made leading on mobile a key goal for 2013 as mobile app use approaches parity with desktop Web use. Given its focus on mobile, it’s surprising the company built a mobile-friendly site. It would dovetail with another of Fab's goals for 2013 -- expanding globally. Fab says a third of its sales already come from outside the U.S., mostly in Europe. Having a mobile-optimized site could help attract new mobile customers, regardless of device type, operating system or country. Among other 2012 metrics spotlighted in the Fab presentation: -The company has sold 4.3 million products, or 5.4 products a minute. This holiday season, it sold 17 products a minute. - On a daily basis, two-thirds of sales are from repeat customers. - Several days in 2012 saw sales of more than $1 million. - 50% of Fab’s sales are home products while 20% are fashion and accessories. Jewelry and art make up more than 10% each. It now has 15,000 products for sale, up from 2,000 at the end of 2011. - Fab has 600 employees, up from 85 a year ago.
It’s one thing to attract mobile gamers; it’s quite another to keep them. But when a game is dependent on advertising support for its existence, keeping them is of the utmost importance. Brendan O’Kane, CEO of analytics and retargeting company OtherLevels, says the buzz for mobile gaming in 2013 will be engagement, determining how long and in what ways a gamer interacts with a title. OtherLevels has been working with HalfBrick (the maker of successful titles "Fruit Ninja" and "Jet Pack Joyride") to determine which messaging tools (including language choice, location and other nuances) work best with different audiences. While O’Kane could not address specifics of those tests (which are still ongoing), he did speak about what will be important for the mobile gaming world in 2013. Q: What do we expect to see in the mobile game market 2013?A: The big drivers are to try and maximize the engagement and lengthen the engagement time. For the game companies, it will be to retain the users, and to move the users between different games within their portfolios. The whole mobile focus through 2013 will be to try and make sure you retain your audience, grow your audience and keep them engaged. Q: How can you do that? What are the best ways to engage mobile gamers?A: You do need to introduce them to new titles, and you need to bring those new titles to their attention. And secondly, when they’re playing an existing title, you need to make sure they’re participating in all the activities they can within [that] title, whether that’s through new levels, or in-game promotions or new experiences. Within one game, you want to make sure you have them engage in the maximum experiences possible. Q: How often do you need to bring new games or other experiences to market?A: My view is that the high-quality game companies only bring their titles to market when the title is ready. The audience has very high expectations. The companies don’t rush to market. The result of that is you want to lengthen the engagement period when you do have a successful title. Something like "Fruit Ninja" is a title that continues to re-attract people. That creates an underlying opportunity for a new audience. You can then introduce them to other titles which might be very attractive. There’s no automatic frequency. But you don’t want to go long periods [between introductions] to keep the audience engaged. Q: Do things change in terms of the target when it comes to keeping gamers engaged?A: It depends on the demographic and the game, and there are games now adding increasing amounts of sophistication. So you can bring people to different levels, and ensure the audience is aware of that. You want to guide them on their journey. A lot of activity is giving them in-game opportunities to encourage them to return. Q: How do you go about measuring engagement in the mobile gaming space?A: The most important thing is to see beyond the number of minutes or the percentages. It doesn’t give you the subtlety of understanding how that links to behavior. A casual user could be engaged with me for 15 minutes, but that’s a great outcome if they get a message and open it later. For us, it's about measuring the outcome that goes way past the playing. It’s much more than what they do in the game. It’s about measuring the outcome that gets the audience member much more engaged with the brand and the game. Q: How do you go about knowing what to look for before you begin creating or launching a game? A: For our biggest game clients, we actually talk with the game producers about determining what they want people to do. We want people to be getting to this level in the game, and we want them to experience a new element of the game. Once you know [those things], you can build backwards to shape the messaging campaign to build to those parts.
App and data manager TigerLogic just agreed to buy mobile app publisher Storycode in a deal valued at about $7.3 million. Per the deal, TigerLogic plans to integrate Storycode -- which helps brands develop story-driven mobile apps -- into Postano, its own social media visualization platform. With Storycode, “we believe we will be well positioned to close the social media communications gap between consumers and brands," said Richard Koe, TigerLogic’s interim CEO. To cut down on costs, the Storycode platform allows brands to use existing content management systems, social platforms and video channels to create and populate new apps. Based in Portland, Oregon, Storycode customers include CBS, NBC, Thomson Reuters, Entrepreneur Media, The Independent and Mindjet. TigerLogic's enterprise customer base includes more than 500,000 active users representing more than 20,000 Web sites globally. The acquisition is expected to close early in TigerLogic's fourth quarter of fiscal year 2013. Closing of the acquisition is conditional on certain conditions, including approval of the transaction by Storycode's stockholders and certain third parties.
The Marketing Services & Technology sector accounted for nine of the 30 largest deals of the year, with 458 transactions valued at more than $20 billion -- up 67% for volume and 36% for value, respectively, compared with 2011, according to a recent report. The Jordan, Edmiston Group (JEGI), an investment banking company, lists the top two largest deals of 2012 from Chinese B2B marketplace Alibaba, which reacquired Yahoo's interest in the company for $7.1 billion, and Dentsu's $4.9 billion deal of the Aegis Group. In Q4, the largest three deals were Nielsen's $1.2 billion acquisition of Arbitron, Oracle's $871 million buyout of Eloqua, and Epsilon's $460 million acquisition of Lake Capital's Hyper Marketing. M&A rose to 1,351 transactions in 2012, up 50% more than the prior year, valued at nearly $75 billion, according JEGI. Driven primarily by smaller deals, as approximately 90% of transactions were less than $50 million in value, about 14 deals topped $1 billion for the year, including six in Q4. Kevin Lee, CEO and founder of the marketing tech company Didit, thinks agencies will continue to acquire and merge in 2013, as a strategic way to grow their holding company. Technology companies, including those focusing on search engine marketing, will consolidate, as well. "Some of the boxes in Terry Kawaja's LUMAscape are getting a bit crowded without showing differentiation," he said. "A smart way to grow a company's valuation is through M&A." The mobile media and technology sector saw 124 deals worth in aggregate $3.5 billion, representing increases of 72% and 77%, respectively, compared with 2011. Many were driven by games and applications. The largest deal in this space during Q4 was Gree's acquisition of social mobile games developer Pokelabo for $174 million. Viggle also acquired GetGlue, a social TV application, for $79 million. Others in the sector were Google, Bertelsmann, Twitter, Yahoo, Zynga, MediaMath, and Urban Airship, among others. The JEGI report points to Adobe's acquisition of Behance, a social online platform where artists showcase and discover creative work; and eFront's $50 million acquisition of Investment Cafe, which offers a suite of Web-based financial reporting and fund-raising products as being some of the most notable deals in Q4. The value of deals for the B2B online media and technology sector doubled to nearly $12 billion in 2012, on 84 announced deals. Aside from the Alibaba's Yahoo deal, the Carlyle Group purchased Getty Images, a creator and distributor of visual and digital content, from Hellman & Friedman for $3.3 billion. The report identifies B2C Online Media & Technology accounted for five of the top 30 transactions for the year, including two deals that took place in the fourth quarter, such as Priceline's acquisition of Kayak for $1.6 billion and Permira Advisers' acquisition of Ancestry.com for $1.5 billion. Two Top 30 deals for B2B Online Media & Technology included Alibaba's buyback of Yahoo's stake in the business for more than $7 billion.
A new year provides an opportunity to take a snapshot look at mobile -- current and future. A wide range of recent research provides some insight into the mobile landscape, from recent holiday shopping results to forward projections. In one study, 19,000 shoppers around the world were surveyed to see who buys online using smartphones and tablets. The leading countries with smartphone buyers are China, India, Mexico, Australia and South Korea, according to the study by Mobify. The top tablet locations for commerce are China, India, Mexico and the U.S. Both smartphone and tablet growth are noticeable, with 17 million iOS and Android devices activated on Dec. 25, compared to 7 million last Christmas. As another indicator of the growing adoption of tablets, more of them (51%) than smartphones (49%) were activated on Christmas Day, according to Flurry Analytics. Not to be outdone by hardware, 328 million app downloads were recorded by Flurry on Dec. 25, at a pace of 20 million per hour. During the holiday shopping season, coupons also were up and coming, with 33 percent of smartphone owners having used them compared to 18 percent last year, according to the SapientNitro Holiday Shopping Poll. In addition to coupons, more than a third (35%) of those with smartphones used GPS and location features to help with holiday shopping and 27 percent used a QR (Quick Response) code to find more information about a product, according to the study. Research is also showing that smartphone owners are somewhat more active when it comes to shopping, with more than half (57%) of them actively seeking out new product information compared to 41 percent of non-smartphone owners, according to Forrester Research. These smartphone owners are also searching, with mobile being responsible for 30 percent of all local searches, according to a study by YP. Moving forward, there will be no shortage of high-speed mobile devices to increase all these activities. Global LTE smartphone shipments are expected to triple this year, from 91 million units last year to 275 million by the end of this year. Total smartphone connections are expected to reach 3.4 billion by 2017, jumping from 700 million last year -- with 70 percent of phones shipped in 2017 expected to be smartphones, according to a forecast by Analysys Mason. Windows phones (yes, they are selling somewhat) are projected to reach 136 million units by 2017 -- which would still be less than 10 percent market share, according to the forecast. Mobile shopping will continue to rise, with almost three-fourths (72%) of consumers 20 to 40 years of age in the U.S. and U.K. already using mobile devices while in-store to compare prices, although the majority leave before making a purchase at that time, according to Accenture. Ad spending on mobile will continue to increase based on numerous studies, with spending this year at $7 billion and $21 billion by 2016, according to eMarketer. And mobile advertising will continue to evolve, with more targeted value and location-based relevance. My rule of thumb is that anytime someone declares that "this is the year of" something, it definitely is not the year of whatever it is they are projecting. No one is saying this is the year of mobile retail. Chuck Martin is author of The Smartphone Handbook and The Third Screen, CEO of Mobile Future Institute and Director of the Center for
The gadgets just kept flowing this holiday, according to most accounts. At least 17 million tablets got unwrapped on Christmas alone, if Flurry’s calculations are on target. In our house, devices had a retro flavor. My daughter fired up her new Nintendo 3DS, mainly to play a Zelda title from a previous generation of console. For my part, I was playing You Don’t Know Jack on my iPhone, Final Fantasy IV on my iPad Mini and Persona 4 on my Vita -- all mobilized versions of games that used to keep us anchored to bigger stationary screens. Such is progress. Tis the day for ‘best of’ lists, and so it is a good time to review which gadgetry actually influenced my media consumption patterns this past year and which disappointed. Since we all admit that media consumption now is a matter of traversing screens more than platforms, our focus should be shifting from hardware to discrete media consumption experiences. My Comeback Kid award goes to Android tablets, but not because I know anything about their ultimate sales. This platform finally became a viable low-cost alternative to iPads and even the bookseller tablets by virtue of a much-improved Google app market. The Google Nexus 7 device is itself a strong-performing bargain, but there are enough core apps and games optimized for this screen to make owners feel included in the tablet party. Google Play is a big leap forward, which appears to be reflected in the spike in download activity across Android devices in the second half of 2012. I still can’t get the marquee apps that many iPad owners use to show off the capabilities of their systems, but the Android team is doing a much better job of surfacing the content that does make their tablets shine. And now that more essential services for screens are cloud-based, even low-end tablets can be effective windows on your media. As much as the Samsung Galaxy III established itself as the first true iPhone contender this year (and I admit I have not had one long enough to get attached), I find that the iPhone 5 continues to impress me as the best smartphone I have ever used. The elegance crept up on me after a month of use as I realized I simply enjoyed accessing media on the thing more than I had on previous phones of all stripes. Its weight, screen technology and incredible speed suggest how much the next generation of hardware actually moves us beyond fetishizing hardware. The brick device becomes a sliver. The display image almost seems to float atop the screen itself. The speed is often faster than WiFi and desktop experiences. All together it feels as if you are plucking information from the cloud and not suffering the inherent limitations of “mobile.” When mobile gadgets start feeling like windows onto information, then tech blog skirmishes over specs become background noise to a next stage. To keep that retro theme going, let’s invoke Bill Gates’ early 2000s “information at your fingertips” promise is coming true in an even more literal sense than he supposed. In the “Who Dropped The Second Screen” category, the Wii U gets more of a shrug than a nod. I am a big fan of Nintendo’s corporate philosophy of leading -- not following -- trends. During all those years mobile gaming spent in the wilderness, Nintendo’s brilliant handheld and then touch interfaces always suggested that pocket-able gaming was going to be massive. Their investments in touch and gesture interfaces deserve much more credit than they get. But I have been consistently disappointed in the Gamepad second-screen experience on the Wii U. Generally it is a heavy, cumbersome anchor that doesn’t carry yet enough second-screen functionality to excite the designer’s imagination. The integrated TV service came late to the party, and I will be damned if I can figure out how it really works with a modern home theater system. The entire unit’s connectivity is sluggish. The software portfolio is so painfully thin it makes the Vita look well-stocked. Theoretically there is time for recovery, but for now the Wii U unit in my test living room is just squatting on a much-needed HDMI channel and waiting to get swapped out for a Google TV 3.0 set top box. My “Let Me Take That Back” honor goes to the iPad Mini, which turned out to be a compelling rethink of the iPad experience. I initially balked at the lower res screen and the pricing, both of which still bug me. Still, thinner, lighter, and not much reduced from its big brother in terms of visibility, the Mini simply ends up getting used more often in my daily media consumption. Arguably, the form factor is superior to the full-sized and full-weight iPad in two key use cases -- ebook reading and game-playing. It is easier to prop up in bed and is wonderfully immersive and lightweight enough for game viewing and controlling. Cost is still an issue because the necessary memory to make it the sole tablet in one’s arsenal suffers Apple’s ridiculous pricing on upgraded units. Worse, this is precisely the form factor that makes the portable tablet (mostly used in the home) into a mobile tablet that would most benefit from a cellular data plan. But again, these additional features are just outlandish costs for a device that still has notable limitations. The “All Dressed Up With Nowhere To Go” nod goes to Sony’s PlayStation Vita, among the most poorly served platforms imaginable. Rarely has the chasm between hardware capabilities and available software been so vast. The hardware is drop-dead gorgeous. The OLED screen, multi-touchpoint control system, and raw processing power here are superb. Priced as high as many game consoles, with game title pricing to match, the Vita overshoots even much of the hardcore gaming market it targeted. But the dearth of quality games for the platform makes this a big disappointment. Finally, the “Life Isn’t Fair” award clearly goes to Windows Phone 8, which likely will continue to struggle against the sheer momentum of the big two players. I have had a while to play around with the OS running on a mid-level Nokia handset and I am impressed by its fresh and plausible take on mobile that distances itself from the iOS/Android order. The live tiles that surface real-time updates of your most-wanted information arguably offer a more native mobile experience than icons, which are just once-removed from the desktop. The organization of screens exposes the limitations of endless icon pages. The level of customizability here is also laudable. Some analysts suggest that Nokia’s international presence will give partner Microsoft traction in the overseas and emerging markets and give the OS the chance it surely deserves. My suspicion is that some of the fine ideas and implementations in Win Phone 8 will be taken up in future versions of the two major forces in smartphones as they maintain control. Good thing, too -- because Microsoft’s OS reminds us how me-too its rivals have become.
The notion of the mobile “crossover” has been avidly discussed throughout 2012. That moment in time when mobile Web traffic surpasses the desktop Internet, and the development of mobile experiences becomes priority one for publishers and ecommerce players across the digital landscape. This “big moment” is a bit of a fantasy. The crossover has been slowly happening before our eyes, and the tipping point may have already passed. In truth, it’s to be expected at this moment in time: Suddenly we have more than a dozen tablets to choose from, a surge in affordable smartphones and drastic improvements to network technologies. More and more, users have been able to adopt the hardware, so the usage numbers are a hockey stick. As a result, major media players are seeing huge leaps in traffic to their mobile properties, in some cases, far surpassing the volumes of PC traffic, with numbers steadily shifting to the mobile side. With the introduction of comScore’s new multiplatform report, it’s clear that many media companies providing services and on-demand information, such as Pandora and Groupon, have already crossed over. Real-time information sources—from WeatherBug to Yelp to ESPN—appear poised to join them in the coming months, with mobile audiences inching ever closer to 50% of their total traffic. E! Latino, the app from NBC Universal that hit the market this week, and sister property to the wildly popular E! Online, doesn’t even have a destination for the desktop Web yet. NBCU conceptualized, built and launched the property with the mobile platform as the helm, a signifier that “mobile first” isn’t a forthcoming prediction, but a reality in which we’ve already arrived. The impact of the crossover phenomenon on monetization and advertising has been at the center of numerous conversations. Marketing dollars have been slow to make their way to mobile platforms, despite the skyrocketing consumer time spent and a growth curve substantially steeper than that of the Internet. But even in the last few weeks, the indicators of the coming impact have started to change: Mobile ad spend forecasts, revised and re-released by eMarketer this month, are now in excess of $4 billion for 2012—a 53% increase from just a few months ago. While there is still a drastic variance between consumer time spent and the volume of ad spend, the validation and recognition from marketers has been climbing much more rapidly than previously thought. While it’s unlikely that overall mobile ad spend will ever be proportionate to time spent or surpass (crossover?) the volumes of ad dollars allocated online, it is looking more likely that video spend specifically could do that. According to eMarketer, mobile video spend is projected to increase at more than twice the rate of online video spend through 2014, priming a curve that if even moderately maintained, could render mobile video budgets bigger than those for online video in just a few short years—or sooner. Aside from the benefit of an audience growing at an unprecedented rate, mobile video has proven to be vastly more effective than its online counterpart. Full screen experiences, lower instances of distracted viewers (or multitaskers), and a balanced volume of ads throughout the day have been contributors to its success as a medium for brand marketers. Another facet of “crossing over” may emerge as better infrastructure is engineered for data collection, tracking and measurement. The technologies that we’ve taken for granted in the online world have proven to be unwieldy and incompatible with mobile. But the head start they’ve provided, in tandem with large strides in standardization, mean mobile may end up with a foundation for ad effectiveness that rivals what we’ve created online.