t 1 The State of ‘SoLoMo’: Where Are We Today, Where Are Going? Greg Sterling June 14, 2012
State of SoLoMo by Greg Sterling - SIMposium 2012
Nov 01, 2014
Industry leader, Greg Sterling presents on the State of SoLoMo (Social, Local, Mobile) internet marketing at SIMposium 2012.
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1
t
The State of ‘SoLoMo’: Where Are We Today, Where Are
Going?
Greg SterlingJune 14, 2012
Greg Sterling, Internet/Mobile Analyst
• Former lawyer, editor, startups, analyst, blogger
• Search, social media, mobile, local, multi-channel shopping, SMB advertising/marketing
• “The Impact of the Internet on Offline Buying”
• Twitter: @gsterling
Daunting Task
The SoLoMo ‘Mandala’
A Mandala is a kind of symbolic representation of the universe used to help “access progressively deeper levels of the unconscious, ultimately assisting the meditator to experience a mystical sense of oneness with the ultimate unity from which the cosmos in all its manifold forms arises.”*
*Author David Fontana, “Meditating with Mandalas”
LocalSocial
Mobile
.
Coherent or Just a Catchphrase?
Social + Local + Mobile . . .The convergence of three major “online” trends:
• Social: word of mouth, user-generated content
• Local: online research offline buying
• Mobile: the internet “in context” (time/space)
Is it “necessary,” inevitable or “organic”?
Brought to You by ‘Post PC’ Devices
"This transformation is going to make some people uneasy...because the PC has taken us a long ways. It's brilliant. We like to talk about the post-PC era, but when it really starts to happen, it's uncomfortable." -- SJ June, 2010
Is SoLoMo ‘Web 3.0’?
• Just hype or real shift in the direction of the market?
• Deskltop or laptop PC is just one of multiple Internet devices (joined to varying degrees by “the cloud”)
• Internet: from “always on” to “always available”
• We use mobile devices to communicate and document our experiences in the world
• Mobile devices help us literally navigate the real world
It’s App-tastic and App-centric
comScore (5/12): “4 in every 5 mobile media minutes” is spent with apps (vs. mobile browser)
Source: Flurry Analytics, comScore, Alexa (2012)
PC-based Internet Mobile apps
72
94
Time Spent - Minutes per Day
Apps Surpass PC Time Spent?
Nielsen says smartphone owners have 41 apps, spend roughly 39 minutes a day using apps
Increasing Audience Fragmentation
Many marketers finding challenges in addressing all these channels coherently . . . then tracking, doing attribution
Multiple Media in an X-Platform World
1. Response to traditional media/ads (68%)
2. Word of mouth (61%)
3. Saw something in a store (44%)
4. Responding to mobile ad (27%)
5. Responding to online ad (18%)
Source: Google-Ipsos Q4 2010, n=5,000
Performed a mobile search after seeing an ad (66%);
Ad medium:
1. TV (58%)
2. In-store (57%)
3. Magazines (48%)
4. Outdoor ad (36%)
Source: Google-Ipsos Q1 2012, n=1,000
2010 2012
Other Media Stimulate Mobile Search
22%63%
15% 82%
77%
66%
45%
28%
9%
13% 10%
15%
19%
16% 39%
14%
9%
Source: IAB, 5/12 “mobile shopping diaries,” n=260
64%
36%
Yes No
Where you using/looking at any other media at the same time [when using smartphone]?
Simultaneous Media Usage
Generation ADD?
Are we creating a generation of anti-social, narcissists with ADD?
Source: Pew Internet & American Life Project, 2012
PC Ascent Has Stopped
Jan-96 Jan-97 Jan-98 Jan-99 Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-060%
10%
20%
30%
40%
50%
60%
70%
80%
90%
50%
63%
73% 75%79% 78%
Source: Surveys conducted in 2012 by each of the sources identified
Smartphone Penetration
Pew Nielsen comScore
53.0%49.7%
44.0%
Likely: 75% to 85% of mobile subscriber population in 3 years
Source: Opus Research, Pew, wireless carrier data (2012)
Mobile Internet Grows with Devices
109+85
Millions of users (US) Total US PC Internet Audience 220M (comScore)
Source: Opus Research (2012), Pew American Life & Internet Project (2011)
25%
17.6%
Pew 4/11 n=2,277 Opus 3/12 n=1,502
• Over 100 million on mobile internet
• More than 20 million people prefer smartphones and tablets to PCs for internet access
Sizable Segment Prefers Mobile to PC
Source: Google-AdMob, March 2011
Tablets Cannibalizing PC Usage
28% of respondents said that the tablet is their primary computer
Yes No
77%
23%
Since you started using a tablet, has your desktop/laptop usage decreased?
Source: StatCounter (June, 2012)
Developing World: Mobile Passing PC
2011
-05
2011
-06
2011
-07
2011
-08
2011
-09
2011
-10
2011
-11
2011
-12
2012
-01
2012
-02
2012
-03
2012
-04
2012
-05
01020304050607080
India: Mobile vs. PC Internet Traffic
Desktop Mobile
Perc
en
t of
traffi
c
Apple Gets into Local in a Big Way
• How good is it and how widely used will it be?
• What will Google’s response be?
• Will there be any paid advertising?
• Will there be potential Siri or Apple Maps optimization?
Local
US Ad Spend by Major Segments (2011)
Source: IAB-PwC (2012), Opus Research, Kantar Media*Total US ad revenues exceed $230 billion
Broadcast TV
Cablet TV
Magazines
Yellow Pages
Mobile
In theater
38.5
31.7
30.0
20.7
18.0
15.2
10.0
6.5
1.7
1.0
0.7
$ Billions
Total $174 billion*
The only traditional medium to see a positive CAGR since 2005 has been cable TV
Local range: $95 to $130 billion
Top 10 Advertising Categories (2011)
Sources: Kantar Media (2012); categories are not all-inclusive
About $60 billion of this is
local ad spending
Source: US Census Bureau Q1 2012
E-commerce is 4.9% of total US retail
$4T in annual US retail spending
95% of Retail in Stores
Source: Opus Research, Yahoo, e-Taling Group (2010-2011)
90% (or more) of online consumers conduct online research before buying offline
Online Research Offline Buying
Local Never Got Any Digital Respect
I told my wife the truth. I told her I was seeing a psychiatrist. Then she told me the truth . . . that she was seeing a psychiatrist, two plumbers, and a bartender.
Despite billions in potential ad revenue digital marketers haven’t given Local much respect . . .
It’s been seen as a “niche” or a “vertical”
SMB Market Hard to Crack
Sources: US Census Bureau, Opus Research
Nonemployer firms
Firms with 1 to 4 employees
Firms with 5 to 9 employees
Firms with 10 to 19 employees
Firms with 20 to 99 employees
79%
16%
94% of all US businesses have 4 or fewer employees
“Last mile” problem: very tough to reach SMBs w/o sales outreach.
Low value: majority of SMBs spend less than $5K per year on marketing/advertising
Challenges Facing National-Locals
Source: CMO Council October, 2011 (n=300 brands, agencies)
Mobile
Mobile Helps People ‘Get Local’
• Mobile phones can be located in a place at a point in time
• Bridges and brings more transparency to online offlline pattern
• Marketers’ own smartphone adoption and behavior helps them understand
• Roughly 40% to 50% of browser-based mobile search “related to location”
• Local-mobile users take action:
- MSFT: within 1 hour (70%)
- Google: within a day (88%)
Source: Google-Ipsos, Microsoft (2010-2011)
Mobile Users More Active, Engaged
Mobile Search Local Action
• 94% of smartphone users have looked for local information
- 90% have taken action as a result
- 70% connected with the business
- 66% visited the business
- 36% made a purchase
- 23% told others about it
• 58% search for local information at least once a week
• 27% search for local info daily
Source: Google-Ipsos Q1 2012, n=1,000 US adults
22%63%
15% 82%
77%
66%
45%
28%
9%
13% 10%
15%
19%
16% 39%
14%
9%
Users Prefer Locally Relevant Ads
Source: JiWire, Q4 2011; survey of adults in the US and UK using JIWire ad-supported WiFi networks
20%
80%
Would you prefer ads that are locally relevant to you?
NoYes
22%63%
15% 82%
77%
66%
45%
28%
9%
13% 10%
15%
19%
16% 39%
14%
9%
Source: IAB, 5/12 “mobile shopping diaries,” n=260
Local Targeting Increases Relevance
Mobile Growth in Paid Search Clicks
“Between 15% and 25% of paid search traffic is now coming from mobile devices . . .
In local-heavy categories, such as dining, auto services and entertainment this jumps to 50% or more.”
-- DataPop CEO Jason Lehmbeck
Source: Marin Software (Q1 2012)
PC Smartphones Tablets (iPad)
2.39%
4.12%
3.12%
Search Ad CTR Comparison
Mobile Users Click More
PCs Smartphones Tablets
5.2%
2.0%
4.9%
Comparative Conversion Rates
Source: Marin Software (Q1 2012)
But Do They Convert?
Source: Google-Ipsos Q1 2012, n=1,000
Conversion Happens Somewhere Else
• 65% of smartphone owners would prefer to use a PC/laptop for transactions
• 37% researched but later purchased online
• 32% researched and later purchased offline
Only 26% Tracking Offline Impact
Source: Google/MMA , Global Perspectives: The Smartphone User & Mobile Marketer, June 2011
26%
74%
Tracking offline impact
Not tracking
DataPop: “In some rare but interesting cases [paid search marketers] are tracking mobile ads down to the offer level and they have seen 5 – 10X sales when accounting for in-store conversions.”
Smartphones/Tablets: Local Nuances
Mobile Phone Tablet
45%
29%
21%
29%
12%17%
22% 24%
Throughout the en-tire process
At the end
In the middle
In the beginning
Stage of local business search when device is used
Source: comScore-Localeze-15Miles Local Search Study, Q1 2012, n=4,000
Where Do You Use Your Smartphone?
Source: Google-Ipsos Q1, 2012 n=1,000 US smartphone owners
Top 3 locations:
1. Home2. On the go3. In store
IAB “mobile diaries” study:
1. At home: 47%2. Out and about: 29%3. At work: 10%
At home
On the go
In a store
Restaurant
Work
Social gathering
Dr.'s office
Café
Airport
On public trans.
School
97%
83%
78%
71%
71%
60%
56%
50%
49%
36%
30% AdMob survey (3/11): 82% of tablets used primarily at home
MINUTESMINUTES
66MINUTES
74MINUTES
81MINUTES
64MINUTES
43
Source: IAB June, 2012
IAB: US Mobile Ad Revenues (2011)
Search where local-mobile revenues concentrated today.
Overall about 25% to 28%
Search Display SMS Total
811
572
295
1678
(in millions)
MINUTESMINUTES
66MINUTES
74MINUTES
81MINUTES
64MINUTES
43
Sources: Mary Meeker, KPCB “Internet Trends” presentation May 2012
Meeker: $20B Mobile Opportunity
Marketers Not Mobile-Ready
• Google: Mobile-friendly sites produce 75% higher rate of engagement (revenue, page views, etc.) per visit for mobile users
• Feb 2011: “Of top 800 Google customers, 79% are not ready to engage mobile customers.”*
• Feb 2012: Only 9% of 1,000,000 sites “mobile ready”**
• Q1 2012: Only 5% of independent restaurants have a mobile website***
*Google: Jason Spero (ThinkMobile event 2011) **Mongoose Metrics, February 2012*** Restaurant Sciences Restaurant Internet Marketing Study (2012)
I’m disappointed
in you
Social
Social Sites Follow Users: Mobile
901 million monthly active users; 526 million daily active users; 500 million mobile users
500M registered users; 140M active users (55% to 60% active on mobile). Twitter generated more ad revenue from mobile than from PC site “on many days in the last quarter” (Twitter CEO Dick Costolo, 6/12)
Making a big push into mobile . . . with Google+ Local content
Source: Company information, comScore (3/12)
80.4% reach; time spent: 20% (browser), 80% (apps)
Mobile Minutes on Social Apps/Sites
Source: comScore March, 2012
Facebook Twitter LinkedIn Pinterest Foursquare Tumblr
441.3
114.4
12.952.9
145.6
68.4
Average Monthly Minutes (US Smartphone Users)
Reviews Preferred Information Source
Source: Nielsen and NM Incite (2011)
Consumer ratings
Consumer reviews
Company website
Call Center
Video clip
Live chat
Company's Facebook Page
Mobile app
Online ad
Company's Twitter account
63%
62%
50%
47%
45%
34%
30%
15%
9%
8%
7%
Which is the preferred source for product/service information?
Top two reasons consumers write reviews and share experiences online:
1. Give recognition “for a job well done”
2. Protect others
Source: AMEX/Network Solutions 2/11 (n=400 US small businesses who did some form of online marketing)
Wor
d of
mou
th
Searc
h en
gine
s/in
tern
et
"Adv
ertis
ting"
Yello
w p
ages
Newsp
aper
s/m
agaz
ines
Store
fron
t
Oth
er
82%
66%
37%
23% 23%17%
21%
SMBs: How Do Customers Find You?
Small Business Embracing Social Media
Google Places
Yahoo
Yelp
Bing
YP.com
Youtube
Other
Groupon
70%
55%
52%
42%
36%
34%
32%
26%
23%
20%
13%
5%
Source: Opus Research-MerchantCircle (Q4, 2011) N=2,096 US small businesses under 100 headcount; Implied-Intelligence analysis of 1.3 million US SMB websites
Which sites do you use to promote your business?
Other surveys: 45% to 60% adoption of Facebook Pages
Source: Palore July 2011
Study: 58% on Either FB or Twitter
Search Social Feedback Loop
Search
Social
Bing teamed up with FB for “social search” to differentiate from Google.
Google responded with social/personalized search and Google+
Also: Google+ Local
“Local is social” (M. Mayer, June 2012)
Search + Social (Bing)
Google+ Local: SoLo Convergence
Foursquare: SoLoMo
Most well-known “organic” SoLoMo app
Mobile was necessary for check-ins and real-time social notifications
Other Developments to Watch
• Siri: the further evolution of the voice interface and intelligent assistant
• Facebook mobile initiatives (Local? Deals? Facebook search?)
• Evolution of Facebook Credits (as offline [loyalty] currency)
• Mobile payments and convergence of payments + deals + offline analytics (“closing the loop”)
• Big (Local) Data: e.g., Skyhook, PlaceIQ
• Telematics and other new Internet access points
• Visual search (AR, scanning, Goggles)
And Remember, Wherever You Go . . . There You Are
You Are Here
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