Yesterday Camerjam events hosted another great mobile service focused conference. The event titled ‘M-publishing’ focused on the future of publishing in the mobile environment.

The event opened with a great key note from the effervesent Jonathan MacDonald. Below:

As you can imagine there was a lot of talk about applications, I don’t how many times the iPhone was mentioned (a lot). I sat on a panel talking about the iPad, a core question – would the iPad market change the publishing industry? 

In short NO - publishers are the ones that will/should change the industry not a device! Why? - relying on  traditional models will simply not work in mobile the business approach and mentality needs to change, and fast. I have previously written about: Real Reasons Why Traditional Media (& publishers) Can Really (Still) Win Big In Mobile. 

Following on from yesterday there were a lot of topics covered, different approaches spoken about; native applications, web applications, paywalls, freemium, advertising… there were also some areas that were not really addressed, context (service and advertising), hybrid applications, user retention…  I felt compelled to share some thoughts. 

My advice to media owners and publishers when progressing a mobile strategy:

First of all: Mobile is a proprietary environment that is emerging and fragmented – there are NO right answers! There are methods to approaching mobile that will enable you to build a sustainable foundation and trial elements that establish the right strategic approach for your business. Having defined, delivered and successfully taken to market mass audience services in three continents there are many challenges and barriers that organisations need to understand. There are some methods that you should not use to approach the market. (See: Mobile: Why Run before you Walk…).  Start point:

MOBILE is another channel but it has very different characteristics to fixed online

• Reality of mobile – device is very personal, lifestyle orientated, user is paying (or percieves to be), no-one ever reads a manual, device is generally difficult to use (relatively poor interface)…
• Consumers when mobile – typically want something, immediacy is often critical, relevance is key, pulling information is not an issue, actionable is a pre-requisite…

MOBILE = COMMUNICATION & SOCIAL (Both natural parts of our life)

• Offer – unlikely we will find a new use for our mobiles so more than likely any service or product has to dovetail in to our existing habits and activities and offer value (or fun)  

PRESENCE = LOGICAL, RELEVANT & TRUSTABLE (The ’how’, ’why’ and ’what’ is so important) 

• Why? – Why are you interesting in mobile and why is your offer relevant to a mobile user (not just because it is a big audience!) 
• What? – What do you want a consumer to do as a result of interacting with your service
• How? - A common mistake that many make is to focus on the device or platform - iPhone, Andriod and now iPad etc. – tactics come into play as you consider execution, not from the outset.

Thinking tactically is fine if you wish to progress a niche path into the market – or develop a showcase service. If you wish to establish as strategic foundation this can be fatal. Don’t get caught up in the hype and technology. (See: ‘iSyndrome’ – Why limit your slice of the pie?) 

ENGAGEMENT = ATTRACTIVE, FUNCTIONAL & EASY TO USE (Services have to offer utility and deliver results)

• Features – Can add value or create barriers (i.e. some carriers/operators in the require applications to be individually signed if they use device features like PIM (contacts book) 
• Retention – Roadmap and adding new features/funtionality is important otherwise users will not comeback (See: Flurry of stats paints shocking picture of Application loyalty)

DISCOVERY = ACCESSIBLE, COMPATIBLE & PERFORMANT (Steps simply represent barriers) 

• Approaches – Re-directed, Leveraged, dedicated, unchartered, in-direct (each can play its role)

REPORTING = KNOWLEDGE, COMPARISON & EVOLUTION (Everything in mobile is potentially measureable) 

• Metrics - distribution, in-service activity, campaign tracking

REVENUE = RELEVANT, INFLUENCING & ACTIONABLE (Everything should firstly deliver value)

Key is to understand limiting factors – potential barriers – from the outset develop a mobile approach that can be controlled by the individual organisation and built from a consistent foundation, not one reliant on or constrained by third parties.  Get as much out in the open from the start! Think about the market – not individual devices and platforms – think about the consumer and the offer.

At Indigo 102 we specialising in bringing out the realities – communicate the benefits and risks – at the early stages. We work with organisations to build mobile strategies that deliver value over time and develop services that are sustainable. If we can support you to invest wisely and establish a sustainable mobile platform get in touch (martin@indigo102.com).

Mobile. Touch. Web

In the past 15 years technology has changed in ways that no one could have forseen. Now with the convergence of the mobile Web and touch screen technology we’re embarking on another journey into the unpredictable. However… 

A Collaborative vision

If we’re all heading in the same direction why not make use of the hive mind to prepare ourselves? We asked some leading industry thinkers what they thought. To make it easier to digest we’ve grouped these thoughts into common themes.

Take a look at what other people are thinking.

Two videos based on a great publication from Young and Rubicam – presented by Simon Silvester.

MOBILE

• Always on
• Always with you
• Always connected

The world is changing as the mobile becomes the computer.

Part 1:

Part 2:

iSyndrome (ai sindreum) n. a symptom, characteristic, or belief, that building an iPhone application translates to = mobile strategy.

In conversation with leading mobile search expert Peggy Ann Salz, of mSearchGroove (of which I am a Guest columnist), we ended up talking about some of the fundamental challenges that organisations face when defining and developing a mobile strategy. Having delivered mass market services in three continents – trust me there are many!

(Peggy has challenged me to make my next mSearchgroove column post around this topic).

After the conversation I was making some notes – a phrase sprung into my mind ‘iSyndrome’, as I was thinking about how many individuals and organisations that have been drawn in by the hype, media, technology buzz surrounding mobile – caught in the iPhone trap.

I shared on Twitter, leading Author Tomi Ahonen was quick to respond with a ROTFL – Rolling On The Floor Laughing – and will provide the great honour of attributing the phrase to me in future presentations.

So here is What I meant…

Having been involved in supporting the development, delivery and launch of mass market mobile services for customers around the world I wanted to highlight one of the fundamental issues I continually witness. 

I see so many organisations investing in mobile without really understanding what they are getting themselves into. Many are spending large sums of money and sadly will likely see very little return (or even worse create negative brand perception amongst consumers). Why?  They are delivering tactical solutions – failing to recognise the addressable market, the mobile environment, understand the ongoing costs of their decisions, falling short of consumer expectations, led by people who are not acting in their best interests.

I am not going to knock the iPhone as I believe that it is a great device, although I no longer use one for daily activity, I have owned two and still frequently use one to trial applications. However, I wish to put the device in perspective in terms of the market and more importantly strategic thinking.

i Syndrome: in the UK the iPhone makes up about 4% of mobile devices in circulation (that’s if we count all the legacy devices too), Android even less – a small slice of the pie. Of all mobile devices; some 70% accessing the mobile web are not Smartphones, some 62% using Applications are not Smartphones. The penetration of Operating Systems (OS) Apple, Blackberry, Android are all low single percentage figures - niches – ask Comscore.

The mass market does not use Smartphones. Yet organisations are spending huge sums of money targeting the Smartphone segment, and worse niches of it, rather than viewing the addressable market. They are getting drawn in by ‘cool’ factors. Doing so they are failing to understand the barriers that exist in what is a highly fragmented proprietary environment and that those barriers will potentially significantly limit their ability to get traction.

People may/will argue that iPhone users make up a disproportionate amount of the time on mobile web sites. That may be true but iPhone users are a relatively small number and are very service transient. As reported by Flurry 70% of application users typically stop using a service after just 60 days.

Developing the coolest iPhone App on the planet is a great ambition, some believe it demonstrates a dynamic business, but the reality it hugely limits market potential. I ask sometimes why even an App? The more features added the more expensive it is to develop and the more likely that fewer people will be able to use it. Many of those features will not be transferable to other devices or platforms – creating your own micro fragmentation and adding to the overall managment headache.

Think iPhone, not everyone in the UK has an iPhone 3GS some have older devices and operate on different Operating System (OS) versions. Despite this many do not consider key elements – backwards compatibility, potential for bugs, updates, version control, signing and approval processes…. they don’t understand the implications of their decisions.

Key is to understand these limiting factors – potential barriers – from the outset develop a mobile approach that can be controlled by the individual organisation and built from a consistent foundation, not one reliant on or constrained by third parties.  Get as much out in the open from the start! Think about the market – not individual devices and platforms – think about the consumer and the offer.

At Indigo 102 we specialising in bringing out the realities – communicate the benefits and risks – at the early stages. We work with organisations to build mobile strategies that deliver value over time and develop services that are sustainable. If we can support you to invest wisely and establish a sustainable mobile platform get in touch (martin@indigo102.com).

(Follow us on twitter : @indigo102)

Guest post published on mSearchGroove 

EDITOR’S NOTE: Mobile advertising is certain the hot topic at CTIA, where Mobile Web And Apps World Forum (Ajit Jaokar’s CTIA partner event) was standing room only. (Well done Ajit!) Players from across the ecosystem are anxious to explore new models to monetize inventory, apps and services. However, as I pointed out during my panel — moderated by well-known analyst and author Chetan Sharma – there’s still is a lot of mileage left in established models such as text and MMS approaches to advertising before we focus too much of our effort on the whiz-bang new ad units and creatives. In his guest contribution, Martin Wilson – MSG columnist and owner of Indigo 102, a strategic consultancy with a focus on media and mobility and a deep understanding of the local space— argues that traditional media owners also have a lot of untapped energy and assets.

***

Advertising based on location is set to be the most valuable and highly contested sectors as players including AdMob, AOL/ Third Screen Media, Jumptap, Millennial Media, and Quattro Wireless jockey for position. Who will be in the winners’ circle? So far, traditional media owners and directory publishers appear to be the laggards and not the leaders in this race – although they clearly have the capabilities mix to dominate this space. Why are they hell-bent on missing the boat? Martin Wilson argues traditional media owners and directory publishers can still be among the champions, not the casualties, provided they act fast.

Mobile advertising has come a long way in a short time. No need to ask ourselves when it finally be the “year of mobile advertising” because the recent flurry of activity tells us mobile advertising has arrived.

First, it was the milestone acquisitions – Google buying AdMob, Apple snapping up Quattro Wireless and Opera surprising us by purchasing AdMarvel. Then it was the funding – Millennial Media led by New Enterprise Associates and Glam Media led by Aeris Capital – that sealed it. Mobile advertising has been validated.

Almost overnight our attention has turned from fixed online advertising to mobile. Now mobile – a personal device that enables brands to market to an audience of one – is widely regarded as the Next Frontier companies must conquer. Little wonder that companies – including Apple, Facebook, Google, Millennial Media and Yahoo – are lining up to do just this.

The market is crowding and muddying our understanding of what matters most.

Predictably, we want to reuse our understanding of old media (online and TV, for example) to comprehend the role and importance of mobile, the new mass media. Thus, we are fixated on size and those players with high volume inventory. Unfortunately, mobile advertising is not just the same numbers game.

Take the narrow view communicated in a controversial report by U.S. research agency Interactive Data Corp (IDC). It estimated the total 2009 mobile advertising spend in the U.S. at around $290 million, a figure based on total page impressions. It calculated market share according to share of total spend and concluded Millennial Media leads the pack with 18 percent ($51 million), followed by AdMob with 14 percent ($40 million), Google with 10 percent ($28 million) and Quattro Wireless in sixth place with 7 percent ($21 million.).

It was also reported by IDC that Glam Media counts 160 million monthly visits to the sites they control or represent, resulting in some 2.5 billion page views. Does this make them a market leader?

Maybe on paper.

However, as I argue in this column, it’s not about page impressions. That is not where the battle will be fought (or won, for that matter).

RAISE YOUR GLOVES

The money is in local advertising, or more accurately advertising based on location. That’s not just my view. Google has been clear about its interest in local online mobile content – and its intention to own the space. In its fourth-quarter earnings call, Google described local mobile advertising as a “huge” opportunity and more recently at the 2010 Mobile World Congress (MWC) claimed to have made mobile its number one priority.

Interestingly, going local (delivering advertising based on location) brings with it a whole new challenge. For one, it is infinitely more difficult to deliver relevant advertising to people
(which is the way brands must deliver advertising on a personal device such as our mobile phones). The opportunity to target an individual based on location is hugely powerful, but the room for error in these brand messages is frightfully slim. Get it wrong and the advertising performance diminishes — significantly.

Put another way, local advertising can’t be a matter of hit-or-miss. Generic advertising is a “fail” and tactical, targeted advertising is – literally – spot-on.

But it sounds easier than it is. This approach – though essential – flies in the face of how we measure advertising success. Suddenly, our singular focus on numbers and quantity (high volume and market share) is irrelevant. Local means delivering quality advertising. It also requires a totally new skillset, a whole new understanding of what we mean by context and how we should deliver relevant advertising.

WHAT IS ‘LOCAL’

If you say ‘mobile’ and ‘local’ in the same sentence, two scenarios spring to mind: ‘where I am now’ and ‘where I am going to be’. But which one is it? It depends. A common mistake is to assume your current location is important, that your location at that point in time is key.

Often it is not.

Mobile is about being ‘mobile.’ It’s about roaming. Mobile location can be a related to a number of things, places nearby or places close to my final destination. Deciding what is relevant is core to the success of any service or proposition delivered via mobile. I’m amazed by the number of services that get it completely wrong.

Why? Because there is more to delivering a mobile location service (let alone location relevant mobile advertising) than knowing the location of the individual. Companies need a detailed knowledge of what is really nearby.

In the U.K. alone, there are over 30,000 recognised places or points of interest. And that’s before you take into account synonyms, postcodes and street names. Linking them together in a meaningful way is no simple task. What are the postcodes or streets in London’s West End or Soho? The taxonomy is complex. When expanding a location to deliver results the relationship between places is important to get right – otherwise the service will deliver meaningless results and fail in the consumers eyes.

With so much as stake, I wonder why companies are so willing to take risks. By adding location to the mix they think they are growing the size of their inventory. In reality they also increase their chances of failure.

Currently, mobile advertising companies work on serving relevant ads based on generic attributes such as country, mobile network, handset type, time of day or theme of the page content. Add location as an attribute and everything changes. Relevancy – potentially down to a micro level – has to be on the mark. Delivering advertising based on locations becomes a mammoth task with a very different set of management challenges.

FREEDOM OF CHOICE

Advertising is content and people will pay with their attention. The structure of the content is important, and keep in mind at all times that mobile is a ‘pull’ medium. Give the people what they want and need. Provide enough information to attract, influence and help inform the decision or action.

You also need to remember that ‘local’ at a micro level is all about offering rich content – which can be challenging to deliver and scale. At the other end of the spectrum, ‘local’ at a macro level is all about providing comprehensive content – which can be challenging to deliver with added-value and competitive differentiation. A rule that applies to both types of ‘local’ content: Content gives a service credibility, interest and value if there is a valid reason (that consumers can understand) why a particular content is shown to them at a specific point in time.

Poorly targeted content is more than a potential annoyance. For many consumers, being exposed to irrelevant content (this includes advertising) on their mobile phones represents a ‘fail’ that interrupts what they are doing and – depending on data plan – costs bandwidth and money. Get it wrong and deliver the wrong content and the consequences can be severe and instant.

Content also needs to be inclusive not exclusive. If a user wants a pizza place nearby, they mean it (!) The service should deliver them details on the restaurant nearby and not the one 15 miles away simply because that business owner paid a premium for it.

Put another way, a location-based social network service should offer people loads of places people can check-in to, and not just the ones a handful of ‘power users’ know, mark and promote. Likewise, a local guide service must have all the places of interest for a town or city, not just the well—known ones in the surrounding area.

Why do local services need to be all-inclusive?

Because the consumer is empowered. They are spoilt by choice and demand the content they want. The Long Tail taught us all that one-size-fits-all doesn’t work in entertainment content. And there is mounting evidence that the same focus on the mainstream will no longer be tolerated in location-based services.

Relevance, as I have shown, is critical in content services.

The consumer’s perception of relevancy is enhanced when:

• They are offered greater choice
• They are empowered to select from a range of options
• They are ultimately responsible for the due diligence and decision

Of course, offering a broad choice of content (in this case, location related information and location relevant advertising) requires the service provider has a stockpile of content to start.

WHAT REALLY COUNTS

Above all, a location-based service has to pass the toughest road test there is. It has to show the consumer what they know is there. Put simply, consumers judge the true accuracy and relevancy of a local service by its ability to offer breadth, choice and insight into the places and businesses they know are nearby.

If the service can pass the test, it earns consumer trust.

Thus, a shopping guide needs to list the shops nearby and not the ones across town. It needs to drill down to the hyperlocal level and present up shops in the area – even better if lists the shop they can see in the distance. Then they can feel secure knowing the service is up-to-date and mirrors the real world around them. (And isn’t that what we all expect of a service that professes to offer local information?)

The same goes for mobile advertising. A guide to city nightlife should be chock-full of bars and clubs and their promotions.

How do service providers get their hands on all this content and advertising?

They partner with companies that have it as their stock in trade.

Take the directory publisher Yell in the U.K. It boasts over 2.3 million business listings –that satisfies the requirement for basic core and structured content. Yell also has over 200,000 searchable online advertisers – that fulfils the demand for depth of differentiating content.

Surely tapping into this content (listings and advertising) is the first – and essential – step to building a strong foundation of content linked to location. What’s more, it’s shortcut to offering the wealth and breadth of content – including familiar content – that consumers have come to demand.

It seems self-evident. But some companies fail to grasp it. In the last weeks I have seen a number of services – TopTable, Grub.it, Center’d to name just a few – come to market with neither basic core and structured content nor in-depth and diffentiating content. Predictably, they were instantly knocked by consumers.

IT TAKES TWO [OR MORE]

As I have shown, the success of a service linked to location depends on the breadth and depth of content (listings and advertising) it offers. It’s content that has long been the lifeblood of directory publishers, but nowhere is it written that these giants will beat the nimble newcomers moving on their turf.

Granted, it will take time for these newcomers to learn the ropes and collect and index the location linked information core to competitive edge. However, there is little reason for more traditional media players, who sit on a stockpile of location linked content, to assume that time is on their side.

Take the case of uLocate Communications, a location services company, headquartered in the U.S.

Sensing a business opportunity it moved fact to fill the gap in the current mobile advertising environment and recently launched Where Ads, a hyperlocal and holistic ad network that pulls together local ad providers that work in other mediums, including directory services, coupons, events and other aggregation services.

Partnerships will be increasingly important. Even for the traditional players it is unlikely that they will excel alone. The recent pairing of directory publisher DexOne and Yelp in the U.S. is a testament that neither company has the critical mass and/or appeal to succeed in isolation.

The new network underlines the importance of getting the right players to the table. Strategic partnering brings a new dimension to the service offer and delivers value to the consumer. But it’s knowing whom to partner with that will decide if a service flies or fails. Picking the right partner requires knowledge and focus. It also helps if the partners we choose have a track record in local and a proven ability to generate revenue.

While the newcomers may have the ambitious mobile strategies, it’s the traditional media owners and directory publishers from the online space that have mastered the capabilities necessary to convert consumer activity (a need/desire to know what’s really nearby) into revenue.

Case in point: Pages Jaunes, the French directory publisher. In 2009 the company counted 885 million visits and online revenues of €461 million. That’s equivalent to €0.52 per visit – a staggering conversion to value. Imagine a scenario where consumers conduct the same number of searches using Google – it’s nowhere near the same conversion rate (or revenues for the advertiser, I might add).

Make no mistake: No other organisation can even potentially come close to the conversion rates and value delivered by traditional media owners and directory publishers. Their ability to create value is inextricably linked to their superior capabilities. They have infrastructure, sales teams and existing customers to target.

In the online space traditional media owners and directory publishers lost their edge to search giants such as Google and Yahoo and have been struggling to catch-up ever since. Mobile is a new game with new possibilities. It’s also a space where location linked content – and lots of it – combined with the capabilities to deliver this content when/where consumers need and appreciate it most can mean the difference between success and failure. These market conditions play in favour of traditional media players and directory publishers. Now it’s up to these companies to recognise their advantage and work with the right people/companies to evolve their businesses, embrace mobile and deliver what users demand.

THE TAKEAWAY

Context, relevance, critical mass and content quality are all key components to a successful and sustainable service in the local mobile space. Who will own this space? Hard to say. But don’t be too quick to write off the traditional media owners and directory publishers that lost the plot in online. They could make a collective and explosive comeback in mobile. Success will be achieved by the companies that see the opportunity, accelerate their efforts, focus on their core strengths and bring the people and partners on board who have mobile expertise.

Get this right and you’re more than fit for the fight ahead. 

Editor’s note: Martin’s next column will focus on how companies should evolve a digital strategy that harnesses mobile to complement existing digital services and thus generate more value. As he shows us: in digital, the outcome can be worth more than the sum of the parts.

Martin Wilson has been involved in digital media for over 14 years, during which time he gained a wealth of experience in the fixed line and mobile Internet. In January 2008, Martin established Indigo 102, an independent consultancy, to assist organisations (including digital advertising agencies, directory publishers, media owners and online service providers) take their brands – and value propositions – mobile. In this role Martin has supported the development and launch of mass market mobile services across three continents. You can contact Martin directly (martin@indigo102.com) and follow on Twitter (@indigo102).

The DUST has settled from this 2010’s mighty industry event – Mobile World Congress (MWC) in Barcelona – yet a FRENETIC interest in EVERYTHING mobile remains. Mobile the HOT topic and a MUST have.

For many ORGANISATIONS it almost seems that if mobile is not on the AGENDA someone is going to be held RESPONSIBLE. The result we are seeing a STREAM of services launching – many with no real PURPOSE, offering no real VALUE.

Rather than ADDING to the ecosystem they are actually potentially causing DAMAGE. They are turning consumers AWAY and WASTING large sums of money in the process. The low RETENTION levels amongst users of applications and services [reported by Flurry analytics] testament.

ORGANISATIONS need to understand that mobile is VERY different. The DEVICE; personal, a communication medium, lifestyle orientated….CONSUMER; perceives to be paying, never reads a manual, typically wants something, patience and tolerance is far less.

STRATEGY needs to be returned to the forefront. Forget the COOL, the PLATFORM, the TECHNOLOGY, the DEVICE – they come later, at the point of EXECUTION. The important part is to get the OFFER, the consumer PROPOSITION right FIRST.

It APPEARS many organisations have be SUBSUMED by the technology and are SUFFERING as a result. For many they NEED to get SPECIALISTS in to help understand the channel and HOW they can deliver VALUE. To capitalise in the FIXED-ONLINE environment most have developed SPECIALIST teams – mobile should be NO different.

Mobile has the potential to be a far BIGGER opportunity for many organisations than the fixed-online environment REPRESENTS, even today. For those that WANT to succeed they should SEEK support from those that really UNDERSTAND the channel.

Image from from Cobrasoft at Stock.xchng

The frenzy has started as organisations jostle for a position in the mobile application hall of fame – ‘Local’ is shaping up to be one of the most hotly contested areas. What is it really going to take to make a mark and how ‘Local’ can you go?

The Apple strap-line resonates – “There is an App for that” – however creating an application does not mean a business will prevail. Many organisations seem to overlook the value part of the process – how are they going to deliver a sustainable model? Not one that relies heavily on investor generosity.

Who is going to ‘use’ the application and who is going to give you the ‘money’? Sounds obvious until you look to some of the fixed online giants – Facebook, Twitter and YouTube – who have huge usage, amazing associated price tags, but have yet to find a way to get anyone to give them real money. All now seek the revenue model –  a challenge as none want to upset the value chain that has given them their success. Making money would have been a far easier process if it had been defined from the outset.

In terms of ‘Local’ this should be obvious – consumers will use and businesses will give money. (If only life was that simple!)

Need for consumers

Setting distribution and marketing aside businesses need to focus on the offer. To get a consumer to use an application it has to offer something they actually want - utility is essential. Without utility a consumer will simply not come back. Analytics firm Flurry recently reported that on average a consumer uses a single mobile application an impressive 6.7 times a week, but also that over 70% of consumers stop using an application after just 60 days. Retention levels of around 30% are clearly not ideal when looking to build a sustainable business. This is especially true when you consider the application environment is becoming ever more crowded.

In a post recently I discussed how the outcome of the service interaction is so important – the consumer action is usually why they came. Recognising ‘what’ a consumer wants to do? is one of the most important components to deliver against. For Local the ‘what’ – call, book, buy, visit or simply provide information – is so important. A successful outcome will encourage a consumer to come back.

Context of ‘Local’

A critical mass of content is essential. A local service becomes useful when it has mass market appeal. Whether it is linked to a single street, district, town or city is largely irrelevant. A shopping guide needs all the stores, not just one or two, a Social guide all the bars and clubs. A core and consistent level of content is a must. Local information typically means a fixed location, building or business. The best historical players in this space are the Yellow Pages publishers as they have the basic details of all businesses – name, address and telephone number. Their challenge is that there are no attributes linked, reviews and comments, images – simply no life. 

It is possible to create or obtain core content, you just need to factor in cost and consistency. As this will form the basis of the Local offer it is important to get it right – otherwise consumers will simply not come back.

How ‘Local’ can you go?

Mobile and Local, two scenarios spring to mind – ‘where I am now’ or ‘where I am going to be’. A common mistake that many location based services make is to assume your current location is important – often it is not. Mobile is about ‘mobile’, it is about roaming. Understanding location is a key part in any service offering as it helps define what is relevant and what is not. This is far more challenging than many believe.

Local at a micro level means content – very rich content – which can be very challenging to deliver and scale. Local at a macro level – comprehensive content – can be challenging to deliver added value and differentiation. The credibility of a Local service will be judged on an area that a consumer is familiar - if positive trust will be instilled. To deliver a truly compelling and encompassing local service from scratch is likely to be a tall order for any organisation. Partnerships that add value and enhance the offer can and should play a valuable role. Whatever the offer, the service needs to evolve and do so in a timely manner to keep consumer interest and engagement. Strategy should reflect all these elements.

Show me the money

Once Usage has climbed to great heights attempts to deliver commercial value begin. It is unlikely that this will come from Users – they have become very reluctant to pay for anything in the digital environment – so businesses become a focal point. Commercial development needs to support delivering an actual return to a business, ideally with no impact on the application utility or usability.

Seeking money from businesses is a challenge and it is a very crowded market and a difficult one to gain a foothold in as there are very established players. Large businesses deal through agencies, small businesses don’t have the time. There are ways the key is to know how to use them for advantage.

Retention of users and usage frequency will become far more important for mobile services and should be central to mobile strategy for many organisations as they start to attempt to deliver real value from mobile.  

Last week I posted about the shocking reality of the retention levels of Apple and Android Applications. Analytics company Flurry recently reporting that some 70% of users do not return to a service after just 60 days. Despite the poor retention level, those that do continue to use services average a very respectable frequency of 6.7 uses per week -  showing loyalty does pay.

The retention figure indicates applications have in effect degraded into a series of “one-off offers”. If this continues, for many organisations the numbers will simply not add up to a sustainable business model. And to re-engage a consumer for a second time is infinitely harder and far more costly.

Why is this happening? I believe this is due to the continued attention around platforms - iPhone, Android, Bada, Microsoft etc. – is distracting many organisations. To the extent that delivering an Application has seemingly become more important than the actual offer. The result is many services fail to deliver to consumer expectation and their interest is rapidly lost.

This poses the question - If only service providers could increase retention levels and maintain frequency of usage?

This is achievable but requires a slightly different thought process.

The reason consumers return to a service is because it offers something that is useful. Typically a consumer when mobile wants something, usually now – patience and tolerance is reduced. The outcome of the service interaction is so important – the consumer action is more than likely why they came in the first place. Recognise ‘what’ a consumer wants to do? This is one of the most important components to deliver against.   

A second area – determine ’why’ the offer is relevant to ensure the service delivers. Often more is less, just because elements flourish in a fixed online environment does not mean they will in mobile. The offering should be defined strategically and designed to evolve, this will support ongoing engagement and retention.  

Once the ‘what’ and ‘why’  are defined the ‘how’ to deliver  becomes important - an enabler that brings a service to life. The ability to deliver services to your audience; the format of those services, the platforms they operate, the priority and scheduling of development, the investment required, then become part of the mobile strategy jigsaw.

Reversing the process in this way – what, why and then how – ensures a focus on the consumer, rather than become embroiled in the ‘cool’ factor trap of mobile that we see many fall in to today. Get this right and improved retention levels and usage will result. This will in turn support the delivery of real value.

As this is such a great follow-on from the article I wrote on  Mobile strategy – iPhone should factor but certainly not dominate. I wanted to share. Post from the great Tomi T Ahonen posted on Communities Dominate brands.

US West Coast ‘Drunk’ on iPhone, yes still drunk, but Android is not ‘the answer’

I am not attending the Heroes of the Mobile Screen – a very good event clearly, that attracted a massive amount of Tweets, on comments by very smart people presenting.

One thought hit me, and I’m sorry, I don’t know for a fact who said it but I believe it was Andrew J Scott, the CEO of Rummble out of London. But it was tweeted that someone (probably Andrew) said: “People on the West Coast of the US are iPhone drunk; its time to wake up to Android.”

ORIGINAL WAS TRANSFORMATIONAL PHONE

Very clever line, congrats. And the first half is totally true. While the iPhone has indeed been a transformational phone, the single most important handset in the 30 year history of mobile phones, not so much because it is iconic (which it is) nor because now so many other phones are now copying it (a major achievement definitely) nor that it has redefined what we as consumers should expect from a well-designed user interface to our phone (which it has achieved) not even how easy it is to use (by far the most easy-to-use smartphone, so simple your parents can learn it without any manuals). All that is great. But, the far bigger impact of the iPhone was to the industries beyond telecoms, bringing in new giant industry players to mobile, including the IT industry to phones (Dell is now the latest to annouce a line of smartphones and just today, 3M announced its intention to enter the mobile telecoms industry) and the advertising industry and the various media industries from print to TV to hollywood. No other phone has transformed the total mobile business environment nearly as much, as the iPhone has. And yes yes, also it has a popular Apps store as well..

Now, about that ‘being drunk’ on the iPhone. Yes, it is the West Coast of the USA which is still very much drunk, delirious about the iPhone. The rest of the world outside of the USA saw the (original 2G) iPhone in 2007, was bemused, at times mildly interested, and didn’t really think it that revolutionary. It wasn’t that spectacular of a ‘phone’ after all. Then over the past two and a half years, we’ve seen gradual improvements to the iPhone, that the 3GS model is now a very competitive high-end luxury/premium smartphone. But if the US West Coast went gaga over the original iPhone 2G back in 2007 – and yes, the UI was revolutionary and its usability and gorgeous large screen (although done in several Asian phones by then) was amazing. But that was two and a half years ago.

What have you done for me lately iPhone? Why the continued hype? Why are they still drunk, today in December 2009? The 3G iPhone was very much a bug-fix – bringing the original 2007 spec iPhone 2G near to the specs of many rival smartphones – and made the upgrade in 2008 current against rival smartphones from 2006! Apple added 3G network speeds and GPS to the iPhone in 2008 and made it capable of accepting third party applications – all features that were ‘normal’ for rival smartphones in the high end of the price range. Even then it was not up to ‘modern specs’ of its rivals, as it did not upgrade its camera – 2 megapixels was underperforming in this price range in 2008 – or give a flash (still missing), or autofocus or provide MMS compatibility or record video. Those – also totally common features of rival high-end smartphones years before the original iPhone was launched – were only added to the model in the summer of 2009.

Now, lets ignore apps stores for now. If you think the original 2G iPhone was a ‘revolutionary’ or ‘innovative’ or ‘transformational’ smartphone – due to its form factor, big screen, ease-of-use, user interface and operating system – those were all introduced in 2007. Why the continued ‘drunkedness’ about the iPhone since then? All upgrades to the iPhone since 2007 have been bringing the iPhone up to equivalent status on what most rivals have offered for years.

It cannot be ’cause to celebrate the iPhone’ now, if it ‘reaches parity’ on some of the abilities the original 2G iPhone did not have. I am not saying the original iPhone was not worth celebrating. But since 2008, when the first revised iPhone, the 3G was introduced – if the iPhone adds 3G which Samsung and LG smartphones have had since 2002, or GPS which was first offered in Japanese smartphones in 2001, and ‘third party apps’ which all other smartphones had a decade earlier – why are these newer abilities of the iPhone causing any reason to be drunk now?

And even today, Apple does not offer a flash, its 3 megapixel camera is pretty puny for 2009 when high end rivals offer 8 megapixel to 12 megapixel performance. The iPhone still ‘doesn’t have removable memory cards etc. After those features and abilities it offered in 2007, in the two upgrades of 2008 and 2009, there is nothing ‘innovative’ or ‘competitively appealing’ that the iPhone has added. All of its ‘improvements’ were abilities its major rivals had had for years. (and I will deal with Apps Stores here below, hold on…) 

iPHONE THE CADILLAC OF PHONES

Now a dose of reality. For all that ridiculous reporting extrapolating outrageous conclusions from Admob data etc (nothing wrong with Admob data but we have to see what they report. They report, that iPhone owners get spammed more by ads, than owners of any other phones on the planet. Americans obsessed with the ‘free but advertising-spammed model’ - I wonder why..) Yes, iPhones receive more ads. But receiving more ads does not mean there are somehow magically more iPhones  in the world. It is ludicrous.

The reality is that there are 35 million iPhones that have ever been made. Out of 4.6 billion mobile phone subscribers on the planet, it means that 0.7 percent – under one percent – of all mobile phone subscribers on the planet have an iPhone. It is not in any way, anything more than a super-premium luxury product, similar to say the Cadilllac brand of cars (which have globally under 1 percent total market share). Look at Samsung for example. Just this year, in the first eleven months of the year, Samsung sold 50 million touch-screen phones, 42% more in just eleven months, than all iPhones ever manufactured and sold in two and a half years. Yes, the Samsung is not quite as sexy and hot and it does not have Apple’s PR glitz and glamour, but is this exactly fair? Most US based pundits ‘drunk on the iPhone’ will just compare the iPhone to the Blackberry and the Palm Pre, and ignore far more widely selling touch screen phones like Samsung, or far more widely selling smartphones like those by Nokia (whose smartphones alone outsell the iPhone by more than 2 to 1).

AMERICA IS DIFFERENT

If you think that ‘the rest of the world really doesn’t matter’ and one should only really care about what happens in the USA, then fine, how about the USA? The US has 280 million cellphone subscribers (yes, American cellphone owners consist only of 6% of all the mobile phone subscribers on the planet). How many US phone owners havs an iPhone? This June, AT&T reported that they had reached 10 million iPhone subscribers. And they are the only network that has the iPhone. Ten million out of 280 million. How many is that? 3.5% that is what it is. In fact, quite similar to my Cadillac analogy – that Cadillac also has by far its best market in the USA, and while Americans love their Escallades, the rest of the world is not going gaga over the gigantic gas-guzzling vehicles and many many other cars of other ‘form factors’ but of similar price, outsell the Cadillac line worldwide. Just like say Samsung and Nokia and SonEricsson and LG and Blackberry and Motorola all outsell Apple globally.

The media pundits and IT press all have iPhones and tend to think that because they personally have iPhones, therefore ‘everybody’ has the iPhone. That is simply not true. For 96.5% of Americans with a cellphone – they do not have an iPhone. The numbers do not lie. Do not fool yourself looking at some Admob data or think everybody is like you, or because you see some iPhones near you, in offices of the IT/tech/media/telecoms industry – that everybody has an iPhone. They do not. Even in America – over HALF of all smartphones are… Blackberries. Of the total installed base of smartphones in the USA, Apple’s iPhones rank in far less than a quarter of smartphones, roughly in line with numbers of those of Windows Mobile based smartphones. Don’t be misled by one quarter’s good sales numbers like this summer quarter for Apple. You only need to look at the spring quarter to find dismal Apple sales of iPhones. And again, most smartphones in the USA are far cheaper than the iPhone. And three out of every four Americans does not own a smartphone of any kind. Lets be real. If you really loved the iPhone in 2007, isn’t it about time we stop being drunk about it, and get real, that since 2007, there hasn’t been that much to celebrate about. Nothing where the iPhone has pushed the (global) leadership in cellphones, and only very modest contributions to the US market and its smartphone offering.

APPS STORES 

Now the Apps Store is gaining enormous press and praise all over. First, remember, all ‘normal’ smartphones except the original iPhone 2G, were able to accept 3rd party applications. So this was a deficiency in the original iPhone.

And for all the tens of thousands of apps on the Apps Store today, Apple is accused by many developers for being draconian in its control of who gets on the Apps Store and how and why or why not. Before you celebrate Apple too much, I have to point out that they did not invent the Apps Store – the world’s first mobile phone applications store was launched in Japan by NTT DoCoMo in 2001, as the i-Appli and the Japanese mobile content, apps and services eco-system is far more robust and healthy and wealthy than the ‘hits-based’ system that Apple now has created. Plus, the Japanese are far less greedy than Apple in taking a cut of the application developer’s money (in Japan the app developer gets to keep 90 cents out of ever dollar, vs 70 cents on the Apps Store).

But yes, that is a finer point of knowing this industry on a global basis. If we ‘ignore the world’ and focus just on the USA, as so often US based pundits, authors and bloggers do, then yes, for the USA, the Apps Store is a big innovation and while many smartphone makers and platforms had offered 3rd party apps for years before Apple’s ‘Apps Store’ – the older platforms like Symbian and Nokia (now as an Apps Store under the Ovi brand) or RIM/Blackberry or Windows Mobile etc - these were not branded as ‘applications stores’ similar to what Apple obviously had with the iTunes Store. So offering apps to a smartphone is nothing new whatsover. Packaging the store was a clever move by Apple for the Western markets including the USA.

But the Apps Store was an innovation of June of 2008 !  It was innovative a year and a half ago. If you had not observed that some apps stores did exist globally before the Apple iPhone Apps Store, that is understandable, as they were very nerdy geeky aspects of Japan etc. But if you think the Apps Store deserves to be celebrated with Apple, then it is an idea from a year and a half ago. Nothing whatsoever innovative since then. Why would there still be this ‘drunkedness’ about the iPhone today in December 2009? Apple, what have you done for me lately?

I want to make one more comment about explicitly the Apps Store. Now we have a totally ridiculous ‘race’ of a platform of tiny user numbers, consuming enormous amounts of data and apps, of a miniscule impact to the industry. Understand what I say. Tiny user numbers, miniscule impact. It does not matter whether there are 10,000 apps or 100,000 apps, or as some have predicted, by the end of the year, Apple to have 300,000 apps in its Apps Store. That does not remove the fact, that there are only 35 million iPhone users globally (with some growth to the end of the year, and yes, also some iPod Touch users). Focusing on the enormous growth of applications in the Apps Store does not make the iPhone user base any bigger at all. It is STILL zero point seven percent of all mobile phones on the planet. Zero point seven percent. If you take one percent of wealthiest people on the planet, you can sell almost anything to them. Kindle book readers and George Foreman grills and Seqway personal transport things. And iPhone apps.

Think how silly this logic is. Cadillac has under 1% of all cars on the planet, and is priced in the luxury end, so it cannot capture a mass audience. Then we hear that hey, the Cadillac can be made with two dozen separate leather trims (it still is a luxury car with under 1% of market). Now, hey, we expanded the interior options, and you can have 100 different leathers (but it still has under 1%). Or, hey, the Cadillac offers 100,000 separate types of leather interiors. That seems comical – as nobody would go through all 100,000 to try to find what they really like – think of that with Apps Stores – but still, Cadillac has no more cars sold. This is only of interest to makers of leather interiors.

And there we have our parallel. The Apps Store hysteria is irrelevant to the giant mobile telecoms industry. It is even pretty meaningless to Apple in terms of any revenue contribution to Apple’s bottom line. Apple has said repeatedly that its iTunes store is not there to make big profits to Apple, it is to help sell more iPod music players. Similarly, the iPhone Apps Store will not be a meaningful revenue or profit engine for Apple directly, but its purpose is to help sell more iPhones. So if there are 10,000 or 100,000 or one million apps, that does not change the fact, that as of the third quarter of this year, there were only a global installed base of 35 million iPhones. The Apps Store measurements are of interest to “application developers” desperate from vanishing sales in the PC industry, now panning for some possible gold on the latest intelligent operating system platform onto which they can develop apps. But then the developers themselves then become deluded by stats such as the Admob numbers and how cleverly Apple ignores the big market, and focuses only on its smartphone maker share.

343 MILLION DOLLARS IS LESS THAN PEANUTS

The number that matters, is that all apps sold in all ‘apps stores’ this year, 2009, will be worth 343 million dollars, as measured by the Yankee Group just a week ago. If you think that is ”impressive’ and numbers in the ‘millions’ impress you – then you clearly are not part of the mobile telecoms industry. The mere value of ‘mobile apps’ BEYOND apps stores was worth 7 BILLION dollars last year, as measured by Juniper Research. So this market, 20x bigger than all apps stores combined, is where those other mobile applications were sold globally, to smartphones such as RIM Blackberries (often business/enterprise apps, not sold through apps stores) or Symbian apps such as the installed base of over 250 million Nokia branded smartphones - or the various other mobile applications pre-installed to several billion non-smartphone type of more basic phones.

And before you have had time to ‘catch your breath’ on that 7 Billion dollar total worldwide mobile applications market - wait, the mobile ’services’ industry is worth… 72 BILLION dollars last year (according to Netsize Guide). And that was before we even counted mobile messaging – about 130 billion dollars said Portio Research (and yes, 26 billion dollars worth of MMS picture messaging services globally, this is why Apple had to add MMS to its iPhone, inspite of Apple’s own protestations)

Only those totally clueless to the big picture of mobile, could be so obsessed by a 343 million dollar tiny corner of the mobile data, apps and services opportunity. All smartphone apps, sold this year on all apps stores, including Apple Apps Store and Windows Mobile and Palm and RIM and Ovi etc etc etc, account for …zero point two percent, 0.2% – 0.002 out of the global mobile data industry annual revenues. The total apps store market opportunity, can grow by DOUBLING in value, for each of the next ten years – utterly impossible economically and statistically speaking – and not be as big as the mobile data industry is TODAY.

It is possible, that some day, the mobile application data opportunity from ‘Apps Stores’ does become a billion dollar industry – give it a couple of years of solid growth and we may get there – and then we can start to consider its relevance. (For context, the 11 year old ‘basic’ ringing tone business is worth 5 billion dollars – three times as big as total Apple iTunes sales worldwide – and these basic ringing tones are only but one of a dozen new music formats we have on mobile phones, totalling over 12 billion dollars in annual revenues.)

Anything worth less than a billion dollars is honestly not worth drooling about in this mobile telecoms industry that towers at 1 Trillion dollars far bigger than the global IT or internet or TV or advertising, or indeed the fixed landline telecoms industries). But today, if you want to deliver your news or advertising or entertainment to the 4.6 Billion people on the planet who have a mobile phone subscription, then you need to start with the three globally available technologies – SMS, MMS and WAP. Only about 17% of the planet has any kind of smartphone – and over half of all smartphones in use have a Symbian operating system, and even the installed base of Blackberries outnumber iPhones globally by 2 to 1.  But 3 Billion people are active users of SMS and 1.4 Billion people are active users of MMS multimedia messaging. In most cases of interactive services, newsletters, advertising and coupons – rather than create an iPhone app, you could deliver the same interactive multimedia apps – and reach 1.4 Billion active users on the planet – and 2.6 Billion total phones that are MMS enabled. Here is your chance, not apps stores. MMS annual revenues alone are 75x bigger globally than all apps store applications this year.

TIME TO SOBER UP

So yes, I totally agree with the first part of the clever quotation, that the US market has been drunk on the iPhone, obsessing about it, and it is time to get past thatn drunkedness. Its time to ’sober up.” The iPhone is now, two total revisions later, a reasonably complete, high-end luxury phone costing 600 dollars (obviously the AT&T contract hides this fact, in reality the iPhone is not a 200 dollar phone – even Apple’s CFO Oppenheimer openly admits that the average cost of an iPhone is about 600 dollars as he did in the quarterly results investor call this summer). That puts the iPhone far beyond the reach of most normal consumers. The average price of a smartphone worldwide is half the cost of the iPhone, at 300 dollars. The average cost of a mobile phone of any kind is under 100 dollars. The iPhone is priced like a Cadillac and will thus find a similar ‘niche’ market only. It cannot – cannot – cannot – ever cannot – become a ‘mass market’ phone with 10% or more of market share (of all phones) unless Apple totally revises its pricing strategy (and I am not talking of contract gimmicks like with AT&T and ‘lowering’ the contract price to 200 dollars or 100 dollars. I am meaning radical real price cuts like it did with the iPod turning that premium niche luxury product into a mass market product).

I am not against the iPhone. There is NOTHING wrong with a luxury strategy, and arguably, Apple is better suited to provide a premium line of luxury products with premium prices, like the Mac personal computers and the iPhone, rather than try to do main stream mass market like say Dell in computers or LG in phones. There is nothing wrong with being a luxury brand and a 1 percent global market share can be a very lucrative opportunity – BMW is often the most profitable car maker and it has that roughly 1% market share, a bit more than Cadillac, globally. And profits are inherently a better target for a business corporation, than revenues. And Apple is very profitable with its iPhone.

But it is time for the West Coast IT/tech industry to stop being drunk about the iPhone. Recognize it was innovative back in 2007, a truly transformational phone. Since then all of Apple’s changes to the iPhone have been ‘catching up’ type of repairs to deficiencies, when compared existing rival smartphones. Apple has given no globally relevant innovation since the first model. And the only major contribution that can be argued, that it was not ‘catching up to the neighbors’ was the packaging of 3rd party application sales into an ‘Apps Store’ (copying the idea from Japan) and that too was far more marketing and smoke-and-mirrors in ‘the store’ as all major smartphone makers did offer third party apps to their platforms; and apps stores themselves already existed years before Apple introduced its own.

FROM CADILLAC TO MASERATI

Now, the second part of that quotation – “People on the West Coast of the US are iPhone drunk; its time to wake up to Android.”  takes the right premise, and then jumps to the totally wrong conclusion. If the iPhone is the Cadillac, then the Android is not Ford or Toyota, the Android is Maserati. If Apple is the Cadillac as a niche luxury product, then Android as Maserati, is a far far more niche, more rare luxury product.

The Android based smartphones are, and will absolutely definitely be for at least the next year 2010, a smaller niche smartphone segment, than even the iPhone. So if anyone is ‘drunk’ on the iPhone today, then the wrong thing to do is to go and now get even more drunk or ‘hammered’ on Android. It is possible, that Android may grow at rates even as good as the Apple managed in its first two years. It is most unlikely that Android can achieve this, for a wide range of reasons, most of all, because Apple’s brand and launch marketing was so powerful, and so many of the Android brands are unknown or relatively weak brands in the mobile phone global market, like HTC and Motorola. But even if Android somehow manages to grow as enormously as Apple did in the greatest new technology launch in history, then Android in December of next year will still be smaller than Apple, far smaller than RIM/Blackberry, and obviously smaller than Nokia in smartphones and not have one percent of the global handset market.

No, the time is not to ‘wake up to Android’. No, the time is to perhaps pay a bit of attention to Android. It is going to fight for that ‘fourth’ place finish, against Windows Mobile and Palm and Linux Mobile and other of the ‘also-ran’ smartphone makers, whose total market share of all phones is far less than half of one percent. I do not mean Android cannot become big, but just like I said when the Apple iPhone launched, that the 10 million initial annual sales target was very ambitious (but I went on record, that I believed Apple could do it), I am saying, lets not be deluded that the mobile phone business is like some consumer electronics industries or the PC industry.

Having the ‘best phone’ is nearly irrelevant to global market success as I have explained, and certainly, having a ‘better’ operating system will not bring Android success or failure. It will not be up to the OS, it will be up to – as always in mobile telecoms – to the distribution channel. Read my blog article if you didn’t know this. Yes, its time to sober up, and not be drunk about the iPhone, but lets not go binge-drinking now and get newly drunk about the Android. Lets deal with reality today.

Below 8 Core principles we typically talk through with our clients when thinking mobile. Get the core right and success rate is greatly improved.

1. MOBILE is already a reality that is growing by the day

2. MOBILE is another channel but it has very different characteristics to fixed online

3. MOBILE = COMMUNICATION & SOCIAL (Both natural parts of our life)

4. PRESENCE = LOGICAL, RELEVANT & TRUSTABLE (The ’how’, ’why’ and ’what’ is so important)

5. ENGAGEMENT = ATTRACTIVE, FUNCTIONAL & EASY TO USE (Services have to offer utility and deliver results)

6. DISCOVERY = ACCESSIBLE, COMPATIBLE & PERFORMANT (Steps simply represent barriers) 

7. REVENUE = RELEVANT, INFLUENCING & ACTIONABLE (Everything should firstly deliver value)

8. REPORTING = KNOWLEDGE, COMPARISON & EVOLUTION (Everything in mobile is potentially measureable)

 The question of iPhone and Android is invariably raised - they are tactics that fall under no. 4 PRESENCE and ‘How’.

If you are thinking about the role of mobile and how it can add value to your business drop us a line.