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RESEARCH Tarik Fawzi Peggy Salz London - June 15th 2009 FACTS AND VISIONS ON AND BY THE MARKET

Tarik Fawzi, AEneas #Maduk

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A taster of the results from IAB & MMA supported research into the UK mobile advertising market (June 2009).If you want to buy the full report then contact James Cameron on [email protected]

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Page 1: Tarik Fawzi, AEneas #Maduk

RESEA

RC

H

Tarik FawziPeggy Salz

London - June 15th 2009

FACTS AND VISIONS ON AND BY THE MARKET

Page 2: Tarik Fawzi, AEneas #Maduk

WHY THIS PROJECT?

All encompassing end-to-end research

Advertiser perspective

Mobile ecosystem perspective

Consumer insights

Mobile in the media mix

Focus on local market

Realistic/constructive outlook

Page 3: Tarik Fawzi, AEneas #Maduk

HOW WAS IT DONE?

Deskresearch

Analysis of existing data, research, cases and otherrelevant information

IAB Ad spend study, Comscore, Informa,

Nielsen

Consumer insights

Online research amongst1000 + consumers, theirattitudes and opinions onmobile advertising and media

UK (region, gender), youngsters, frequent mobile internet users

Expert interviews

Individual interviews on the topic with market experts

Operators, advertisers, media buyers, sales houses,

infrastructure suppliers,application parties

Page 5: Tarik Fawzi, AEneas #Maduk

RESEA

RC

HRESULTS 2009

Page 6: Tarik Fawzi, AEneas #Maduk

MOBILE IS IN IT’S INFANCY

21.9%

19.5%

13.1%

19.2%

3.2%

11.7%

5.4%

5.1% 1% 0.16%

TOTAL AD SPEND 2008

23.4%

22.6%

19.5%

2.9%

3.8%

15.5%

4.9%

6.5% 0.9%

2003

market: £17,5 bnmobile: £28,6 m

Source: IAB/PwC/ WARC 2009

Page 7: Tarik Fawzi, AEneas #Maduk

MOBILE IS INTERNET 10 YEARS AGO

£28.60 0

20

40

60

80

100

120

140

160

180

200

-

500.00

1,000.00

1,500.00

2,000.00

2,500.00

3,000.00

3,500.00

4,000.00

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Gro

wth

(%)

Ad

sp

en

d(m

)

INTERNET AD SPEND BENCHMARK

Internet

Mobile

YoY Growth (I)

YoY growth mobile 2008 99,2% Opera and eMarketer forecast similargrowth for 2009 (while total market is expected to decrease with 10%)

Informa forecast of 2.2% market share in 2013 is comparable to Internet’s2.9% in 2003

2,9%

Source: ÆNEAS STRATEGY 2009 (based on IAB/PwC/WARC 2009, Opera 2008, Informa2008, eMarketer 2008)

Page 8: Tarik Fawzi, AEneas #Maduk

£3,832.5

£3,349.7

£5,705.0

£560.0 £7.0 £28,6

02:0001:54

00:37

00:58

00:23

00:35

00:00

00:14

00:28

00:43

00:57

01:12

01:26

01:40

01:55

02:09

£0.0

£1,000.0

£2,000.0

£3,000.0

£4,000.0

£5,000.0

£6,000.0

TV Internet Press Radio Games Mobile

Tim

e sp

end

(h

ou

rs)

Ad

sp

end

(m

illio

ns)

AD SPEND VERSUS TIME SPENDAd spend

Time spend

* **

Source: IAB/PwC/WARC 2009, ÆNEAS STRATEGY 2009

* 1) Time spend on press is sum of 22 minutes for newspapers and 15 minutes formagazines/tabloids

2) Ad spend is sum of press classified and press display** Ad spend is indicative based on 0,04% of total ad spend 2008 USA (Nielsen)

TIME AND MONEY DON’T ADD UP

Page 9: Tarik Fawzi, AEneas #Maduk

VALUE CHAIN

Advertisers Media buyersSales

houses

Ad

servingOperators

Infrastructure

suppliers

Application

partiesConsumers

Page 10: Tarik Fawzi, AEneas #Maduk

MOBILE THROUGH CONSUMER EYES

Source: ÆNEAS STRATEGY 2009

74% 72% 77% 88% 82%

I never turn off my phone

75% 73% 76%92% 85%

My phone is the most personal device I own

54% 54% 52%64% 62%

Interacting with the brands I love and consumewith my phone is easy

43% 47% 39% 46% 47%

Advertising on my phone is trustworthy

54% 53% 56%65% 61%

If I receive an interesting offer on my mobile phone I will send it to friends and family

92% 90% 96% 96% 96%

I will not leave my house without my phone

Page 11: Tarik Fawzi, AEneas #Maduk

MOBILE IS NOT TRUSTWORTHY

=32%positive attitude towards advertising on the mobile phone

16 - 44

Source: ÆNEAS STRATEGY 2009

Page 12: Tarik Fawzi, AEneas #Maduk

MOBILE IN THE MIX

Television Radio Press Cinema

Outdoor Direct mail Internet Mobile

Source: ÆNEAS STRATEGY 2009

Page 13: Tarik Fawzi, AEneas #Maduk

CONSUMERS HAVE THEIR TERMS

Source: ÆNEAS STRATEGY 2009

• Privacy is NOT the most important attitude driver

• Men are most conservative and show the least attitude change

• 84% of youngsters has a positive attitude towards mobile advertising ifincentivized

32%

55%61% 60% 65% 67% 69% 74%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Initial Privacy Profile information

Preferences Relevance Permission Control Incentive

Po

siti

veat

titu

de

MOBILE ATTITUDE DRIVERS

UK MI 16-24 Man Women

Page 14: Tarik Fawzi, AEneas #Maduk

Relevance > Privacy

Source: ÆNEAS STRATEGY 2009

0%

10%

20%

30%

40%

50%

60%

70%

80%

Age Gender Location Income Interest Sports Fashion Music Hobbies Lifestyle Brands

Will

ingn

ess

to d

iscl

ose

(%

ye

s)

Profile & Preference information

UK 16-24 MI Men Women

Income is too personal

Location: killer app?

Page 15: Tarik Fawzi, AEneas #Maduk

IT IS ALL ABOUT THE MONEY

4%12%

3% 6% 4%

8%

4%

8%7%

5%

10%9%

8%12%

9%

36%38%

35%

37%

35%

26%26%

28%25%

29%

13%9%

15% 11%14%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

UK 16-24 Men Women MI

INCENTIVES

Ringtones

Music

Games

Applications

Monthly amount

Discount bill

One off

Texts & Minutes

Minutes

Texts

Source: ÆNEAS STRATEGY 2009

64% of UK consumers would grant permission to receive mobile advertisingif they are incentivized

70% of UK consumers would grant permission to receive mobile advertisingif they are incentivized AND are in control

5Messages a day

Page 16: Tarik Fawzi, AEneas #Maduk

MOBILE IN THE MIX REVISITED

Television Radio Press Cinema

Outdoor MobileDirect mail Internet

Source: ÆNEAS STRATEGY 2009

57% would prefer mobile over Internet

58% would prefer mobile over television

Page 17: Tarik Fawzi, AEneas #Maduk

AWARENESS IS BELOW 50%

Source: ÆNEAS STRATEGY 2009

• Youngsters have higher awareness of richer advertisingchannels (MMS, games & apps)

0%

10%

20%

30%

40%

50%

60%

VoiceSMS

WebSocial

networksMMS

Tv/VideoLBS

GamesApplications

Awareness mobile channels

UK 16-24 MI Men Women• SMS advertisingis best known

• Women are awarenesslaggards

• Voice is low,but 51% wouldlisten to voicead if incentivized

Page 19: Tarik Fawzi, AEneas #Maduk

ADVERTISERS

OPPORTUNITIES

OBSTACLES

ROAD AHEAD

“…a bigger growth rate than mobile advertising, like location-based marketing, you will have mobile couponing, mobile ticketing, mobile payment, all these things will probably

grow so much faster”

“…companies cannot afford to actually develop a full-blown program on the mobile”

“…brands do not understand is that we can actually do much more. We haven’t cracked it”

“…measurement was aligned with what we know from the Web or TV”

“…it would totally be unrealistic to say that in 2009 or 2010 we make it into the single digit share. But it’s growing, clearly growing”

“it’s just another touch point within my marketing mix”

Page 20: Tarik Fawzi, AEneas #Maduk

MEDIA BUYERS & SELLERS

OPPORTUNITIES

OBSTACLES

ROAD AHEAD

“…Exposure to multi-channel advertising gives you exponential impact in terms of response rate and brand awareness”

“…I can't see a campaign that isn't opt-in. I'm surprised that any can exist”

“…We need to realize that there's much more we can do on mobile than banner advertising”

“…But where it’s going to win is the integration. Cross-media. No company or individual with a channel approach; you need people that are total specialists”

“…Mobile adds the what and the where and that's what triggers a fundamental shift for advertisers. ”

Page 21: Tarik Fawzi, AEneas #Maduk

APPLICATION DEVELOPERS

OPPORTUNITIES

OBSTACLES

ROAD AHEAD

“…big opportunity in every country to make mobile advertising really work is to have media sales bureaus or agencies who sit in between the owners of the

inventory and the advertisers ”

“…Operators themselves are not organized to open up the inventory to advertisers, and the market is divided between multiple operators that

don't really work together”

“…Core to mobile advertising is mobile messaging”

“…Opportunity for advertisers to interact via messaging linked to a certain location or time, and that will develop ”

“…advertising has to be relevant because is mobile is also a personal medium.”

Page 22: Tarik Fawzi, AEneas #Maduk

INFRASTRUCTURE SUPPLIERS

OPPORTUNITIES

OBSTACLES

ROAD AHEAD

“…you’re going to start seeing those players just sort of die away, when mobile advertising is serious business, then you're talking about millions of adverts

and not just a few hundred thousand. ”

“…interesting for a carrier when the revenue they can envisage starts off at 2 percent over their overall revenue That's the revenue that will make them

sit up and listen and we're not there yet”

“for the next 2-4 years, text multimedia messaging, voicemail notifications, and even voice are opportunities for advertising that we should start with first. If we

start there it will benefit the whole value chain, and specifically the carriers”

“the mobile directing advertising to the most relevant screen ...for mobile to truly take off it needs to be integrated...requested from the mobile screen and

delivered elsewhere”

Page 23: Tarik Fawzi, AEneas #Maduk

OPERATORS

OPPORTUNITIES

OBSTACLES

ROAD AHEAD

“…opportunities such as advertising actually embedded within a widget”

“…more mainstream brands are entering the space. But we need more…”

“…If brands want to reach a customer base, we can offer banners and messaging”

"Mobile is not a mainstream channel for advertising – yet”

Page 24: Tarik Fawzi, AEneas #Maduk

INFLUENCERS

OPPORTUNITIES

OBSTACLES

ROAD AHEAD

“…Text-based advertising is still vastly under-rated,… and it keeps growing”

“…Every operator and major player in the industry is scrambling to have some kind of app store availability ”

“…It’s the role of the industry to reach out and educate the marketers, not the other way around and we’re failing to do it ”

“…The ambition for mobile ought up to be that it has its place at the table alongside all the other channels”

“…There’s kind of an unhealthy expectation of mobile”

“Mobile is at its most effective when integrated with other traditional means of communication. ”

Page 25: Tarik Fawzi, AEneas #Maduk

WEAKEST LINK

Advertisers Media buyersSales

houses

Ad

servingOperators

Infrastructure

suppliers

Application

partiesConsumers

Page 28: Tarik Fawzi, AEneas #Maduk

NEXT STEPS

Final report July 2009

Workshops as of July

USA, The Netherlands (2nd) and Germany Fall 2009

UK (2nd) 2010

International comparison and best practises

Page 29: Tarik Fawzi, AEneas #Maduk

www.mobileadvertisingresearch.com

MSEARCHGROOVE

Peggy Ann Salz+49 [email protected]

ÆNEAS STRATEGY

Tarik Fawzi+31 6 531 15 [email protected]

Atva van Zanten+31 6 414 39 [email protected]