Black Friday data reveals mcommerce is popular purchase mechanism

Data reveals that many more shoppers relied on mobile for purchases, convenience and deals on Black Friday, with PayPal seeing a 310 percent increase in mobile shopping that day.

Retail giant eBay also reported an increase in mobile shopping on Black Friday. This year, eBay’s suite of mobile applications nearly doubled their sales over Black Friday 2009. Globally, eBay Mobile is on track to nearly triple its sales over last year.

“The tough economy has made shoppers more price-conscious and this year’s Black Friday results show that they’re going online to find the best deals,” said Amanda Pires, senior director at PayPal, Palo Alto, CA.

“With the convenience of shopping from a laptop or mobile phone, more people are choosing to avoid the long lines, parking chaos and early morning rush in exchange for great online deals available from the comfort of their homes,” she said.

PayPal and mobile
Starting in holiday 2009, mobile has emerged as an important new shopping channel and is expected to be used for a growing amount of holiday season purchases, Ms. Pires said.

PayPal mobile transactions have increased six-fold- from $25 million in 2008 to $141 million in 2009, and Ms. Pires expects this trend to continue as more retailers leverage the power of mobile devices for holiday shopping.

Consumers are turning to their mobile devices for smarter shopping this holiday season by doing price comparisons, staying on top of all the best deals and ultimately making purchases from the convenience of wherever they are.

With its mobile services, PayPal is giving this year’s holiday shoppers the ability to spend on their terms.

PayPal saw a 297 percent increase in mobile payment volume on Thanksgiving Day 2010 compared to Thanksgiving Day 2009, as well as an approximate 310 percent increase in mobile payment volume on Black Friday 2010 compared to the previous year.

According to an NRF 2010 report, approximately 27 percent of American adults who have a smartphones are expected to use mobile devices for holiday shopping this year.

Mobile Web performance
Gomez provides a real-time view into retailers’ mobile Web performance, indexing sites based on speed, availability and consistency.

The QVC mobile site consistently performs well. The company did so, on Black Friday and found that mobile device shopping performance is lagging.

This is the first year mobile device shopping is gaining significant traction. Gomez data shows that retailers’ mobile Web performance during the Thanksgiving weekend has been disappointing, particularly in the area of speed.

“Mobile Web sites are reminiscent of where the overall Web was 10 years ago, performance-wise,” said Matt Poepsel, vice president of performance strategies at Gomez, Lexington, MA.

According to Gomez, the top-performers in mobile site performance throughout the weekend were QVC, Newegg and Walmart, respectively.

PriceGrabber mobile data
According to PriceGrabber.com, consumers turned to their mobile phones to shop for LCD TVs, tablets and digital SLR cameras on Black Friday.

Popular products for Black Friday 2010 included the Lenovo Notebook, Apple iPhone 4 smartphone and the HP Mini 110-1144NR Netbook.

PriceGrabber also found that big-ticket items such as electronics, computers and cameras were particularly popular on its iPhone application during Black Friday.

An earlier survey by PriceGrabber revealed that more than one in three holiday shoppers (36 percent) are using their mobile device for shopping-related activities this holiday season.

Of these mobile shoppers, 32 percent were planning to shop from their mobile phone on Black Friday.

The top 5 most popular Black Friday categories visited on PriceGrabber’s iPhone shopping application were electronics, computers, cameras, appliances and toys, respectively.

“Over the past year, PriceGrabber has been dedicated to driving innovation based on the needs of its shoppers,” said Laura Conrad, president of PriceGrabber, Los Angeles. “One of our proudest new developments has been the creation of the PriceGrabber mobile platform which includes apps for the iPhone, iPad and Android.

“One might think that shoppers could be slightly intimidated when it comes to shopping for big-ticket products such as computers and appliances from a mobile phone,” she said.

“Saving money was clearly a great motivator on Black Friday when it came to consumer adoption of innovative technology.”

Mobile Commerce Daily’s Giselle Tsirulnik interviewed Gomez’s Mr. Poepsel. Here is what he had to say:

Were consumers using their mobile devices for purchasing during Black Friday?
Analyst data suggests that mobile devices will play a role (in some way) in over a quarter of U.S. consumer spending (across all channels) this holiday season.

This means not just for making purchases, but for anything that makes the holiday shopping experience faster, easier and more convenient - researching product availability in stores; comparing product prices between retailers; and gaining fast, easy access to coupons and deals through mobile apps, for example.

For the Black Friday/Cyber Monday period thus far, Gomez’s User Experience Index has shown that mobile Web performance continues to lag behind the traditional Web.

Generally, for any type of web experience (traditional PC or mobile), a numerical score of 70 or greater is considered fair; a score between 85 and above 94 is considered good; and a score above 94 is considered excellent.

Mobile Web performance throughout the weekend has hovered around 50 – low compared to the traditional web, but consistent with or even a bit higher than the mobile Web performance baseline (based on performance over four non-peak weeks in October).

We can assume that mobile web users have been pretty satisfied with their online holiday shopping experiences thus far, but just this afternoon (Cyber Monday), performance across the top 15 mobile retail sites has dropped off slightly, indicating a decrease (for the first time since last Wednesday) in the number of satisfied users relative to the baseline, as the online shopping season comes into full swing.

Overall, for the “official” start of the 2010 holiday shopping season, mobile web performance has not kept pace with the PC web, and any major increases in mobile commerce this holiday season are likely to come about through mobile apps Mobile Web sites are reminiscent of where the overall web was 10 years ago, performance-wise.

What other functions did mobile serve on Black Friday?
As indicated above, consumers often use mobile devices to augment the shopping experience, especially when they’re pressed for time like during the holidays. So even if actual mcommerce rates remain relatively low, the mobile web is likely playing a huge role in driving revenues through other channels like in-store.

What are the criteria for being top performers in mobile site performance?
The top mobile site performers demonstrate the best speed, availability and consistency (the standard deviation between fastest and slowest response time) in user experiences. Since last Wednesday through now, the top mobile web performers have been QVC, Newegg, Dell, Williams Sonoma and Office Max.

One reason why mobile web performance continues to be a challenge may be that many retailers are still figuring out the proper balance between functionality and speed on a mobile site.

More specifically, they want to offer a feature-rich mobile web experience consistent with what their customers experience on the traditional web, but this can result in slowdowns in mobile web downloads, since many devices simply can’t accommodate the same volume of content as a desktop PC.

The key to optimizing a mobile experience for speed is to streamline site content and multi-step transactions based on what mobile customers do and expect on the site.

But if you start taking away too much feature-richness and content from time-pressed consumers, this may have the adverse affect of irritating them, especially during the holiday season. Striking the critical balance between speed and functionality is key and it’s all about knowing what your mobile customers want.

-Giselle Tsirulnik

Mobile Advertising Revenue To Grow Tenfold By 2015 To $24.1B

New data released today by Informa Telecoms & Media indicates mobile advertising revenue will rise tenfold to about $24.1 billion by 2015, with much of that growth coming from China and India.

The Asia Pacific developing region will account for the largest share by 2015, at 30.9 percent, driven by “strong growth” from China and India, according to the research.

“Successful companies that have unique and attractive technology for mobile advertising will become takeover targets for companies such as Google, Apple, Nokia Oyj and Yahoo,” said Shailendra Pandey, a senior analyst with London-based consultant Informa. ”Apple’s iAd network, which was started in July, will force its rivals to speed up their own mobile advertising strategies, particularly Google, which has completed its acquisition of AdMob,” he said.

Closer to home, North America will account for 18 percent of the market in 2015, with Latin America at 6.4 percent and Western Europe at roughly 8.6 percent, according to the report. “The mobile advertising industry has now moved beyond the trial and experimental phase and many advertisers and brands are now spending significant sums on running mobile campaigns each month,” Pandey said.

Mobile shoppers to account for 28% of holiday spending

Mobile shopping "warriors" (i.e., hyper-connected individuals and "warrior wannabes" (moderately connected individuals) will account for $127 billion in consumer spending during the 2010 holiday season, representing 28 percent of the $447 billion the National Retail Federation forecasts U.S. consumers will spend over the next few weeks, according to a new study conducted by research firm IDC. More than a third of smartphone-carrying consumers indicate readiness to use their mobile devices to shop more effectively and efficiently, especially in traditional brick-and-mortar retail stores; shoppers are searching for price and product information, checking merchandise availability, comparing prices at nearby stores, browsing product previews and purchasing goods.

Adults aged 25 to 44 years make up nearly two thirds of the mobile shopping warrior segment despite representing less than half of consumers surveyed, IDC notes. In addition, adults aged 45 to 54 years were the most likely to leverage mobile data to their advantage, like asking merchants for a better price to match one they find on their handset while in the store. While the influence of social media outlets on buying decisions is growing, IDC states that retailers remain the most important source of information shaping purchase decisions: "Consumers' increased comfort with using their smartphones to go online anywhere combined with their plans to use them more in the 2010 holiday season signals the beginning of a significant shift away from the capacity of the store channel to hold sway over consumers as they move to a purchase decision," said IDC Retail Insights program director Greg Girard in a statement.

-Jason Ankeny

Volkswagen ties increase in sales to branded mobile app

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Volkswagen found that from the vast amount of consumers who bought a car after playing around with the company’s branded iPhone application, more than 50 percent were new VW owners.

An executive from AKQA, who helped Volkswagen promote its 2010 GTI vehicles, shared results from the campaign during the Mobile Marketing Forum. According to the executive, the company saw great results in terms of downloads, brand impact and car sales.

“This was not an easy decision for them,” said Daniel Rosen, head of AKQA Mobile. “It was somewhere where the client was being brave.

“It was literally an iPhone application, social media and Web intergration,” he said. “This is very far from what Volkswagen does in mobile – it’s part of the strategy for the their car launch of GTI.”

User engagement
When looking at how it can get the word out about their new cars, Volkswagen briefed all of its agencies and focused on what the company can do to increase car sales.

AKQA did not want to just roll out a branded game like other companies have.

“It had to be all about quality,” Mr. Rosen said. “Whatever game we created or used had to have the strongest driving experience.

“Not only is it the first time someone launched a car on mobile, but invested in creating a world class driving mobile game,” he said.

Real-time gaming
The Real Racing GTI application has been downloaded more than 6.3 million times.

Volkswagen saw more than 485 million impressions in the first six weeks and 200 cars were sold to registered GTI players.

Additionally, the company saw that there was 97 percent lower cost-per-sale than a traditional launch and there was more than a 5 minute average engagement time.

“The application was actually all part of a social media push in the beginning,” Mr. Rosen said. “It’s basically like a Hollywood movie launch.

“It’s all about the opening weekend, opening day and how that movie is going to perform in the next year,” he said.

-Rimma Kats

Tis the Season to Redeem a Mobile Coupon

It’s looking to be a mighty mobile holiday season since there are more smartphones than ever roaming the U.S. In a recent survey, JiWire found that nearly 90% of smartphone consumers plan to use...mobile apps and services during the next few weeks of holiday madness.

Mobile coupons are likely to quite enticing to holiday shoppers on the go — 49% were willing to check in on a mobile app, with 29% interested in finding deals. Twenty-one percent of those surveyed reported redeeming a mobile coupon in the last 90 days while 30% were willing to travel more than five miles to use a mobile coupon.

-Gavin Dunaway

Mobile ads four-to-five times more effective than online ads

REDMOND, WA – Mobile advertising is four-to-five times more effective than online advertising on average, according to an InsightExpress presentation at a Microsoft workshop.

“Mobile versus online is not necessarily apples to apples, but it’s simply a basis of comparison, and we’ve found that mobile advertising is four-to-five times as effective as online,” said Joy Liuzzo, Washington-based senior director of mobile research at InsightExpress, said at the Microsoft mobile marketing workshop last week at the software giant's headquarters.

“That’s due to various factors, including lack of clutter in mobile, typically one ad per page, and the mobile pages themselves typically do not have a lot of stuff going on—they tend to be very clean," she said.

“Also, the proportion of the ad on a mobile screen is greater, so it gets more share of eyeballs. We found that folks doing activities on their smartphones are as positively engaged as when they are doing something on their computer, so it’s a perfect storm of why mobile advertising works so well right now.

“We've seen this increase in certain mobile ad campaigns, because they’re not just static banners anymore, they’re more engaging—engagement is the secret sauce of mobile.”

Take advantage of multiple mobile channels
Smartphones are the new phone, as a third of mobile owners have smartphones, per InsightExpress.

Hence, conversations are shifting.

While there are a lot of feature phones out there, a high percentage of people who are interacting with mobile marketing campaigns are smartphone users.

Looking at consumers ages 25-34, about 50 percent of them have smartphoens, so the reach is getting there.

Text messaging still has the most reach, because both smartphones and feature phones are SMS-enabled.

But when marketers look at the mobile Internet, applications, video and social networking, the large majority of traffic is coming from smartphone users, which is a different audience altogether.

When marketers make the applications versus mobile Internet distinction, they should realize that consumers with smartphones use both.

“When it comes down to consumers, they are flowing in between apps and the mobile Internet, not making a choice of one or the other,” Ms. Liuzzo said. “There are a couple of areas where the mobile Internet is leading the charge.”

For example, among merchants and retailers that have a mobile commerce presence, 50 percent have a mobile Internet site only, 12 percent have an application only and 39 percent have both a mobile Web site and an application.

Ms. Liuzzo offered another interesting insight: social pressure drives mobile adoption.

Consumers take note of what all or most of their family and friends are doing on mobile, and it tends to be monkey-see, monkey-do.

“The fact that we have so many folks doing these activities using their handsets, that will encourage more folks to do them as well, and it will keep going on and on and gathering momentum,” Ms. Liuzzo said.

Behavioral pattern obvious
Patterns of mobile usage are already emerging.

For example, 82 percent of consumers have used their mobile phones in a store, 55 percent in a doctor’s office or hospital, 17 percent during a movie at the theater, 14 percent while flying on a plane and 7 percent during church service.

Around 17 percent of mobile users have shown a clerk in a store a picture of a product on their mobile phone, saying in effect “I want this please,” which is a new shopping behavior that is surprisingly being driven by men.

Thirty-four percent of men ages 25-34 and 29 percent of men ages 35-44 have done so.

Ms. Liuzzo calls men the forgotten shopper, and they overindex for mobile shopping behavior.

“When you start to look at who is driving the behaviors using their mobile devices in store, it is primarily men ages 25-34,” Ms. Liuzzo said. “Men are now showing these new behaviors—‘I’m in a store, and I’m going to use my mobile to find out what I need and get information.

“If their behaviors are out there, as a marketer or merchant you take advantage of them as much as possible.”

-Dan Butcher

One In Three US Consumers Download Mobile Apps, 25% Of All Apps Are Used Daily

New research out from the Mobile Marketing Association (MMA) as part of the September 2010 U.S. Mobile Consumer Briefing indicates that one in three US consumers download mobile applications, and that a quarter of all apps downloaded are used on a daily basis.

The research stemmed from a monthly survey of U.S. adult consumers about their mobile marketing behaviors and opinions. Each month, the MMA and Luth Research collect answers from a demographically representative sample of more than 1,000 U.S. adult consumers. Conducted September 17-24, the current survey asked consumers a variety of questions about usage of their mobile phone and some of its features, including number of apps downloaded, frequencies of use, reasons for non-use of applications and so on.

The survey more or less confirms what brands already know, which is the fact that mobile applications provide a unique medium within the overall mobile channel. For example, 10 percent of mobile consumers who have downloaded apps described their most used app as one that can be used for ordering or purchasing products. This indicates that apps are fast becoming a consumer shopping and sales tool offering both mass-market reach and intensity of usage.

“With half of all mobile consumers downloading apps this year or next, MMA can officially mark the birth of a new mainstream advertising and marketing channel within the family of mobile media,” said Peter A. Johnson, vice president of market intelligence, MMA, and author of the study. “Marketers now have the opportunity to bundle fun and advertising, drama and customer service, utility and sales in a single, quarter-inch icon. To place an app on the mobile desk-top that commands consumer attention on a daily basis should be on every marketer’s “to do” list as they plan for 2011.”

Some other key findings from the survey include:

>>Sixty percent of those surveyed said their “most used” app provides entertainment

>>Twenty-two percent of respondents expect to download more apps next than they have this year, while 40 percent expect to download the same amount

>>Over the next year, mobile users will seek new apps focusing on entertainment, restaurants, banking and travel

>>As free apps supported by advertising represent about 31% of all downloaded apps, apps represent a significant advertising opportunity for brands

MMA: 59% of subscribers turning to mobile for holiday shopping

Fifty nine percent of adult mobile subscribers in the U.S. plan to use their handsets for holiday shopping and event organizing (not including voice calls)--up 25 percent over a year ago--according to a new consumer study published by the Mobile Marketing Association and Luth Research. Asked how they will use their devices during the holiday season, 64 percent of respondents of so-called "mobile holiday shoppers" say they anticipate using their phone before going to a store, 13 percent plan to purchase or pay for gifts via mobile and 12 percent expect to use their device to respond to a TV, billboard or newspaper ad. Shoppers also plan to rely on mobile services to pinpoint the location of where gifts are sold and to compare prices.

Asians, Hispanics and adults ages 25 to 34 are the demographic segments most likely to use their handsets for shopping and celebration planning, the MMA notes. Movies, music, consumer electronics and books rank as the top gift items that shoppers plan to target using their phones; Hispanics and Asians also believe mobile services can help more effectively identify toys and game purchases.

-Jason Ankeny

Apple, Android Win Big in Q3

Yesterday, Gartner released its Q3 2010 mobile and smartphone sales data, and the results show particularly strong gains for Android-based devices and Apple's iPhone.

In the third quarter of 2010, worldwide mobile phone sales rose 35 percent over the same quarter last year, with a total of 417 million units sold. Smartphone sales continued their meteoric growth, with a 96 percent increase over the same period last year, accounting for 19.3 percent of all mobile phone sales in Q3.

“This quarter saw Apple and Android drive record smartphone sales. Apple's share of the smartphone market surpassed Research In Motion (RIM) in North America to put it second behind Android while Android volumes also grew rapidly making it the No. 2 operating system worldwide.” said Carolina Milanesi, VP of research at Gartner. The quarter marked the third consecutive double-digit increase in sales year-on-year.

In all, nearly 81 million smartphones were sold last quarter. Android made up slightly more than a quarter of all smartphone sales worldwide, with 20.5 million units sold, positioning it as the second-most popular operating system behind Symbian, which moved nearly 30 million units. In the same quarter last year, only 1.4 million Android-based devices were sold.

Android was particularly dominant in North America, where Gartner estimates it made up 75 to 80 percent of all of Verizon's smartphone sales. It was also bolstered by the launch of the multi-carrier Galaxy S line from Samsung. Gartner also noted that the OS's move into low- to mid-level devices helped it globally. This tactic could continue in the U.S. with Android's coming holiday spree.

Apple also did considerably well, thanks to the iPhone 4. Not only did Apple surpass RIM globally with almost 13.5 million units sold to RIM's 11.9 million -- putting it in third place behind Android -- it also jumped ahead of the Blackberry manufacturer in the important U.S. market. Apple is now second only to Android in the U.S., and third in Europe (still behind Nokia and Samsung).

“Smartphone OS providers have entered a period of accelerated platform evolution, stimulated by more regular product releases, new platform entrants and new device types,” said Roberta Cozza, principal research analyst at Gartner. “Any platform that fails to innovate quickly — either through a vibrant multi-player ecosystem or clear vision of a single controlling entity — will lose developers, manufacturers, potential partners and ultimately users.” (Perhaps a veiled reference to RIM?)

The most impressive feat in the mobile market was the appearance of Apple in the top five manufacturers. Its 13.5 million units landed it in fourth place, ahead of RIM. Gartner posits that it could have sold more, but was hampered by ongoing supply constraints. The firm also noted that enterprise adoption of the iPhone and iPad has grown, despite Apple's focus on individual consumers.

Looking forward, Gartner expects 2011 to be a big year for media tablets like Apple's iPad. It projects nearly 55 million tablet devices to be sold next year. It also predicts that it will be another big year for Apple, in general. “To a developer, the iPod Touch and iPhone (and to a lesser extent the iPad) are effectively the same device and a single market opportunity. While Android is increasingly available on media tablets and media players like the Galaxy Player, it lags far behind iOS's multi-device presence," Milanesi said. "Apple claims it is activating around 275,000 iOS devices per day on average — that's a compelling market for any developer. And developers' applications in turn attract users.”

-Mark Kurlyandchik

My Take On "SMS VOTE" by Ben DeLeon

Do you know how much it costs to promote an SMS campaign to get customers to just simply subscribe in order to receive an advertiser's promotional alert messages? That by itself is a reasonable undertaking.

Now, imagine how much more expensive and more complicated it can be to get customers to send a multitude of text messages - just so they can vote on something?

If your client is the NFL, sure! Voting is great because (1) NFL has a lot of advertising money to promote a "vote now" SMS campaign, and (2) They have a fan base that's comfortable with the concept of "taking sides" or "picking" or "choosing" teams. Vote is a natural and relevant concept for these customers.

But if your client is MisterPizza, a "vote sms campaign" is a big waste of money and a bigger waste of time. What would you ask people to vote on? Which pizza they like better: pepperoni or ham? Good luck.

Vote is "SOOO last year" - when SMS was the new marketing toy that made every advertiser excited and drooling with ideas. But, it's time to get serious. SMS is a powerful tool that should not be wasted on fringe concepts - especially if you're a small business with just enough advertising dollars to simply try the best of what mobile marketing can bring.

Don't waste your efforts on SMS voting schemes.
And that's my take on "vote".

Smartphone traffic will increase 700% by 2015

Analyst firm Informa Telecoms & Media calculates that smartphone traffic on wireless networks will increase 700 percent over the next five years. The research firm--which coined a new metric for measuring wireless traffic: ATPU, or average traffic per user--said that although worldwide only 13 percent of mobile phone subscribers use a smartphone, those smartphone customers spend more time on the network and have an ATPU of 85 MB per month.

The research firm estimates that in the U.S., where the disparity between smartphone and non-smartphone traffic is the greatest, about 86 percent of mobile data traffic today is generated by smartphone users. And Informa predicts that smartphone ATPU in North America will increase from 85 MB per month today to 776 MB per month by 2015.

In Western Europe, the firm said smartphone ATPU will increase from under 44 MB per month in 2009 to more than 736 MB per month in 2015.

Interestingly, Informa said the highest smartphone ATPU is in South Korea and Japan. Those countries, according to Informa, will have an ATPU of 271 MB per month (in South Korea) and 199 MB per month (in Japan) in 2010--two to three times higher than the global average.

Informa said the iPhone is currently the highest-traffic-generating device, followed by Android devices, and it expects the iPhone to retain its lead because Android devices will be spread across high-, mid- and low-user segments.

-Sue Marek