Initial Hypothesis

comScore / M Metrics: Top 5 Trends in Mobile

Mark Donovan, SVP + St. Analyst

Mobile Broadband:

• 29% Mobile Broadband Penetration
• Mobile Broadband Lifts Media Consumption
• 2-3x times data consumption with 3G over 2.5G

Smartphones:

• In January 2005 - 45 models
• In January 2008 - 152 models
• 122% YoY Increase in Smartphone Owners
• Only 7% of consumers have Smartphones
• Active Media Users Embrace Smartphones

Mobile Web:

• 46% YoY Increase in mobile web audience
• Utility web audience grew even faster 5x to 10x - news, weather, maps, traffic, search, banking
• Smartphones still raised the bar further
• Clear emergence of consumer experience - moving past the novel and time wasting application
• Mobile has now become mainstream and relied upon - a very important part of this digital mix today.

Mobile Advertising:

• Mobile provides new advertising platforms
• SMS is the most mature
• 112MM text users last year
• 48MM Mobile gamers
• 14MM Mobile Video viewers
• Mobile Web Drawing Top Brands

Top 10 Sources of Mobile Web Advertising

• Publishing
• Personalization
• Broadcasting and Cable TV
• Automobile
• Internet Software
• Application Software
• Movies and Entertainment
• Aerospace
• Specialized Consumer Services
• Diversified Banks

The iPhone Effect:

• Clearly Apple is hitting it out of the park
• The iPhone has a significant and broad impact
• Increased the service penetration of social networking, video, music, browsing and game playing
• Small audience, but outsized impact
• Software is the new mobile battleground (cf. Symbian, Android)
• "Openness" is the new black

Tags: Digital Media Conference, mobile, search

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CEA - Trends to Watch Heading Into 2008

Sean DuBravac, Chief Economist, CEA

Things are continuing to improve - the transition from Analog to Digital is alive and well.  Everything is getting faster slammer, clearer, with greater capacity and cheaper.

Further integration of devices, accessories, content, services network and community continue to be aligned and integrated from the beginning of the solution and product launches.   Service providers and content owners are collaborating at launch.   The Amazon Kindle is a good example of this type of integration and seamless integration of content.  Devices increasingly are moving in this direction/

Distribution is evolving.  There are new methods.

New Battlegrounds:

The Living Room:

• Supreme Court ruling allowed the betamax to be sold and distributed in 1984.
• The typical services that controlled that portal - cable, OTA, and satellite.
• 75% of households with an internet connection have broadband
• Netflix box, set top boxes, TIVO are allowing the consumer to consume content when they want.
• The traditional cable operators (MSOs) are integrating DVR capability into their set top boxes.  This used to be ruled by the OEMs.
• Gaming and computers, including the Wii, Xbox 360 Media Center capabilities,
• What’s next for Television?

Battleground #2: The Palm

• What’s next for Palm and Pocket?

Tags: Digital Media Conference

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ad:tech SF 2008 Schedule

I have been following www.sched.org since SXSW and am happy to see them aggregate the ad:tech schedule for next week.

I’ve completed and posted mine for what it is worth:

http://adtech-sf08.sched.org/dhelmreich

Tags: ad:tech

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Transitioning from an online chat to offline phone call

When chatting, twittering, messaging on facebook or texting, and the conversation gets to the point where you are ready to get on the phone, haven’t you noticed that regardless of who makes the suggestion to move to a call, the FIRST person to type in their phone number (even if you know their number by heart), won’t have to initiate the call? The person who types in their number the fastest never initiates the call.

Think about it - try it on the next chat - you’ll see that I am right.

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ISP Based BT under scrutiny in the UK

There was an interesting article this morning on ClickZ detailing the privacy scrutiny that is being placed on a UK-based ISP-based Behavioral Targeting company.

Some of the interesting tidbits from the article follow - don’t you think they would have been better prepared to deal with the consumer privacy backlash?

If this is the prevailing wind in the EU, would any of the national US-based ISPs every allow a company like Phorm, NebuAd, AdZilla and others to deploy their boxes on the network?

A dedicated protest site has gone live at badphorm.co.uk, and an Web page has been set up to petition the Prime Minister.

“We petition the Prime Minister to investigate the Phorm technology, and if found to breach UK or European privacy laws then ban all ISP’s from adopting it’s [sic] use,” reads the petition, which has been signed by over 1,000 people.

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Behavioral Targeting - what we need to do next?

Curent methods:? Offline, online, cookie-based, ISP-based.? Current issues:? social networking privacy concerns, opt-in, opt-out, standards, relevant guidelines.

What is the impact of consolidation in the industry if traffic is the ultimate commodity.? Over the past couple of years, the acquisitions in the market have been around data and traffic.

If better connecting the advertiser and user is the ultimate goal, what is the ideal method to increase the relevance for? the user?? Many of the prominent BT providers use Age, Gender, Location (which is often inferred or user submitted) as the primary keys upon which they derive their segmentation methodology.? I don’t know where to start poking holes that method - it’s just too easy.

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Is Behavioral Targeting (BT) an invasion of privacy?

I recently asked a question regarding BT on LinkedIn, and received some very interesting responses. Obviously this is a very unscientific survey that is clearly skewed and not normally distributed, but the responses are interesting nonetheless:

I have included a few below:

• “No, I do not think it is an invasion of privacy. It’s no different than your favorite Visa or Mastercard sending you targeted inserts or coupons in your statements based on your spending habits on that card. I don’t complain when Discover sends me 10% of at Home Depot. Do I want someone tracking my online purchase, viewing habits, etc, probably not, but I also don’t want the local Chinesse delivery joint storing my cc# in theit computer. It happens, it’s called technology and it allows companies to more effectively and effeciently target their audience. Basically, I don’t want to see any regulations that limit the ability of the free market system to grow and flurish. I don’t want to see further handcuffs on small or large business trying to operate in the US.

  As a user, I’d much rather see an ad targeted to me based on exhibited behavior than a RON/ROS ad that I have no interest in.”

• “Regarding privacy, BT is not an “invasion” it is an “invitation.” Everyone accepts and understands the quid pro quo of the free internet content world is having ads – lots of them – served up on top, behind and along with the editorial. So my view of the next wave of BT is a manner, method, and process for the user to create a managed ad profile with selective inclusions and permissions. This profile starts very simply with standard gender, age, income, zip code information. It is enhanced with certain data points or beacons linked to multiple ad networks and sites. Importantly these data need to be complied into major classes of customers as already defined by services like Nielsen and comScore so the data becomes actionable and useful information.

• BT is not an invasion of privacy.It infact is a great means for both the advertiser and the targeted user-to keep out stuff / audience which is irrelevant to both. But the big question is that BT in its present state with publishers leaves much to be desired and is not effective due to various loop holes.For BT to be a success,a lot needs to be done by websites offering it as an advertising option,at a premium rate.

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Product Development and Planning

I couldn’t help but laugh when I saw this over the weekend - Scott Adams hit the nail on the head with this one. If you have ever experienced this within an established company, you understand.

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OMMA Behavioral: “The Hot Zone: The State of the BT Market”

David Hallerman, Senior Analyst, eMarketer

• Spending and where it is going
  • US Internet Advertising Spending - $50B in 2012
  • US BT Ad Spending, $3.5B in 2012
    • As share of spend, 9.6% of total US Internet Advertising Spending in 2012
  • BT will get a 27% budget increase in 2008
• Why dollars don’t deceive - stats for 2008
  • Google net revenue (US Only) 8.4B
  • Retail ecommerce - $161B
  • Internet Advertising - $26.7B
  • BT advertising $925mm
• Forces for change
  • US Marketers say BT among one of the most important tactics (online and offline)
  • BT - top performing tactic for great ROI -outperforming contextual, affiliate, rich media
  • 79% of most ad execs agree “Long tail always existed, technology makes it easier”
  • Advertisers and Agencies prefer specific publishers over networks for targeting

• Less change than you might think
  • In general, 80% of respondents think that data accuracy makes web analytics and ad tracking problematical
    • 40% had concerns with the validity of cookie-based measurement
  • Top three marketing trends in 2007:
    • Marketing Basics
    • SEO
    • Personalization
  • 74% of respondents only put between 1% and 20% to new media properties and experimentation
  • The largest US advertisers still (mainly) put small share of spending online
    • 3.1% share among top 100
    • Top 10 all less than 6%
      1. P&G - 1.1%
      2. AT&T - 5.1%
      3. GM - 3.6%
      4. Time Warner - 2.9%
      5. Verizon - 4.4%
      6. Ford 3.8%
      7. GlaxoSmithKline - 0.6%
      8. Disney - 5.7%
      9. Johnson and Johnson - 1.5%
      10. Unilever - 1.3%

• What people really want
  • People don’t want to be targeted
    • Call people, “people”, not consumers, Internet users, target audience
  • Relevancy - but they’re not crazy about being targeted
  • Privacy - and yet they want personalization
  • Transparency - think of it as marketer ultra-honesty
  • Control - not just in word - and difficult indeed

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OMMA Behavioral: “Are You In or Are You Out?: Targeting the Social Network”

Moderator: Rob Graham, VP of Creative and Technical Training, The Laredo Group

Panelist: Molly Hop, Group Media Director, Critical Mass;
Jeff Freedman, Director of Business Development, MillionsofUs
Davis Brewer, Lead Digital Strategist, Spark Communications
Arnie Gullov-Singh, VP, Product Management, MySpace/Fox Interactive Media
Basem Nayfeh, Chief Technology Officer, Revenue Science

Overall, the panel agreed that this is a tremendously exciting time in advertising. As users are adopting social media, we increasingly have the ability to make advertising both effective and more efficient. through increased relevance. Social networks gives us a massive platform for self-expression. When consumers raise their hands and indicate their interest, it creates very powerful opportunities for targeting.

There seems to be a clear opportunity to utilize outside data on top of existing user submitted information. It was mentioned in the previous session with regard to the work that [x+1] is doing, and continues to be raised in most conversations on the stage and in the room. Rather than just targeting on what someone has just told you, it has been discussed that actual behavioral data acquired from other places on the web should be utilized on top of existing user-submitted information. The reverse of that can also be true - now can we take that profile data and actual conversions and analyze the efficacy of targeting methods - these feedback loops (if in place) will drive advertisers, publishers and service providers closer together.

There was a consensus that increased relevance of advertising would reduce some of the current privacy concerns. People are sharing a significant amount of data about themselves, especially for those that are using social media.

Let’s assume that BT, appropriately integrated with offline behavior and online user submitted profile data, will drive up CPMs, increase CTR, and reduce advertisers CPA.

Tags: behavioral targeting, privacy, social networks

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