Courting the-mobile-consumer-7-18-final (1)

Courting Today’s Mobile Consumer

July 18, 2012

Presented by
Dan Lee
Director of Product, Digital
Nielsen

1

Title of Presentation
Copyright © 2010 The Nielsen Company. Confidential and proprietary.
2012

Consider…JUST 5 years ago

Phones were primarily used for phone calls

Smartphone penetration was in single digits

The first iPhone was just released – Android
was still a vision for the future

The first iPad was still ~ 3 years away

How things have changed…even in the past year!
2

Source: Nielsen

Agenda

1 Who is the mobile consumer?

2
What is the mobile consumer doing on their
device?

3
How does mobile compare to TV and
Online?

4
How do consumer’s feel about advertising
on their mobile devices?
3


Who is the mobile consumer?

4


What are mobile consumers using today?
They are now mostly smartphone owners
Smartphone & Feature Phone Penetration, US
Mobile Subscribers Ages 18+

71% 69% 70%
65% 64%
62% 63% 62%
59% 58%
57% 56% 56%
54%
52% 52% 53% 55%
51% 52%
50%49% 48% 47% 45%
48% 48%
46%
43% 44% 44%
41% 42%
38% 37% 38%
35% 36%
29% 31% 30% Smartphone

Feature phone
Oct-10

Oct-11
Apr-11

Jul-11

Apr-12
Nov-10

Dec-10

Sep-11

Nov-11

Dec-11
May-11

May-12
Jan-11

Aug-11
Feb-11

Mar-11

Jun-11

Jan-12

Feb-12

Mar-12

Jun-12
5

Source: Nielsen Mobile Insights


This is especially true for younger and higher income
demographics
Smartphone Penetration by Age and Income
Mobile Insights Q1 2012 Ages 55+
is 30%
81%
with 51%
76%
74% annual
72%
67% growth
60% 61%
59% 58%
51%
47% 46%
42%

34%
31%
25%
22%
16%

Ages 18-24 Ages 25-34 Ages 35-44 Ages 45-54 Ages 55-64 Ages 65+
<50k 50k-<100k 100k+
6

Source: Nielsen Mobile Insights


Consumers continue to adopt Android and iOS devices

NUMBER OF
49M 90M
ANDROID & iOS
USERS

May 2011
May 2012

PERCENTAGE OF
APP DOWNLOADERS
WITH ANDROID AND iOS PHONES

June 2011 80% APP 92% APP
June 2012

7

Source: Nielsen Smartphone Analytics


Gender can impact how consumers interact with apps
Male Share of Top Apps

58% 58% 58%
55% 56% 55% Gender Share by Usage Segment
53% 52%
50% 51%

56% 58%

Facebook YouTube Google Pandora Twitter 44% 42%
Search Radio
Mar-11 Mar-12

Female Share of Top Apps

50% 49% 48%
47% 45% 45%
42% 42% 44% 42% Low High
(bottom third of app (Top third of app
users) users)
Female Male
Facebook YouTube Google Pandora Twitter
Search Radio
Mar-11 Mar-12

Males tend to be first adopters, but females are quick 8
to catch up


Mobile consumers ages 25-44 make up a majority
of the high usage segment

Age Distribution Low App Users iOS Age Distribution High App Users iOS
Smartphone Analytics May 2012 Smartphone Analytics May 2012

Ages 18-24 Ages 55+
10% 9% Ages 18-24
19%
Ages 55+ Ages 45-54
32% 12%
Ages 25-34
21%

Ages 35-44
25% Ages 25-34
Ages 35-44 34%
Ages 44-54
17%
19%

9



Key Takeaways

Majority
Smartphones = Big
Mobile Media Usage
Gains

Android and iOS
continue to dominate
reaching 90M users
in the U.S.

10


What is the mobile consumer doing
on their device?

11


How are Mobile consumers spending their time?

U.S. mobile subscribers U.S. Mobile subscribers are
are avid app users … engaging in:

• Mobile Internet Browsing grew
from 98 million to 129 million
+102% 109
• Mobile App Downloads grew
from 41 million to 72 million
54

2011 2012
…are increasingly
embracing mobile
Total Mobile App Duration on Android & iOS
(Billions of Minutes Per Month) media services
Nielsen Smartphone Analytics May 2011 – May 2012

12

Source: Nielsen Smartphone Analytics and Mobile Insights


Consumers spend the majority of time on apps and are
diversifying the range of apps used

TIME SPENT ON PROPORTION OF TIME SPENT
APPS VS. WEB TOP 50 APPS

72% 81% 72% 56%
May 2011 May 2011
May 2012 May 2012

13



Poll Question
Which of the following categories do you think has had
the biggest percentage growth in the past 12 months?
Just to clarify, we’re not talking absolute growth in
terms of unique users, but growth percentage.
a) Commerce & Shopping
b) Communication (e.g. Email, messenger apps, Skype etc.)
c) Entertainment
d) Finance
e) News & Information
f) Photography
g) Social Networking
h) Travel

14


Consumers are pushing apps into the mainstream at
a fast pace
2011 Growth Rate of Mobile App Unique Audience by Category on Android or iOS
Smartphone Analytics May 2012 vs. May 2011

Instagram added 13m users in
Photography 123% the past year and has grown
270% in the past 3 months
Travel 116%

Finance 105%

Communication 98%

News & Information 90%
In the past year Amazon
Commerce & Shopping 89% Mobile added 8m users while
Amazon App Store added 6m
Entertainment 85%
and eBay added 5m

Total Mobile Universe 84%

Social Networking 59%
15



Consumers are driving a lot of movement in the top
50 apps

Distribution of Time Spent in Change in App Ranking Year over Year -Top
Apps on Android and iOS 50 Android and iOS Apps
Smartphone Analytics, March 2012 Smartphone Analytics, March 2011 – March 2012
“All Other
Apps”
26% a
year ago

16



Consumers are using their mobile devices to stay
social and local
Mobile Apps and the Social / Local Intersection

YouTube
Social Google
Gmail Search

Pandora Twitter Google
Radio Maps
Facebook
Draw The
Something Weather
Free Instagram Channel
Words
with Weather
Friends Local

12 of the top 15 17
apps have a social and/or local component



The growth of selected mobile games is outpacing
Android and iOS growth
Unique Audience on Android and iOS
Mobile NetView 3.0
77% growth
83,675 among
79,324 selected
75,065 games
71,545
68,574
65,643

Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12

iPhone / Android Active App User Audience18+ (000)
Select iPhone / Android Games Combined Unique Audience (000) 18



Mobile phone and tablet influencing gaming
Overall gameplay for the average gamer increased by 7% in 2011 vs. 2010,
driven by various platforms, but mainly mobile and tablet

The rise of iOS, Android & Facebook as platforms has partially, but not
completely, driven F2P gaming growth

Mobile/tablet gamers are more gender-balanced & skew 18–34, non-white,
$100K+ income. Within them further segments emerge, including mobile-only
players driven by teens

Mobile and tablet F2P gamers are more likely & willing to pay for gaming
content than their PC peers

19

Source: Nielsen


Mobile phones are shopping companions and
shopping assistants

89%
use smartphones
while shopping in
store

Top Shopping
Apps
1. eBay Mobile
2. Amazon
Mobile
3. Groupon
4. shopkick
20

Source: Nielsen Smartphone Analytics and Mobile Connected Device Report


Mobile devices are impacting the consumer’s path
to purchase
Comparing prices
online while shopping
Purchase
in a store
Done Mobile
Shopping on 40% 18%
Smartphone or Using Location
Tablet Based Services
to find a retail
location

No 21%

Searching for/using
online coupons
25% Paying for goods
and/or services at
Yes 79% POS at a merchant

Discovery 8%
21

Source: Nielsen Mobile Shopping Report


Mobile provides an opportunity for the Financial
vertical
Active Reach of Mobile Banking/Finance Apps Average Time Spent per Person (Minutes)
Smartphone Analytics, May 2012 Smartphone Analytics, May 2012

Chase 10% USAA 35

Bank of America 10% Mint.com 31

PayPal 9% Chase 20

Capital One 4% Bank of America 19

Mint.com 4% Citibank 14

USAA 3% Wells Fargo 13

Wells Fargo 3% Capital One 12 Category
Citibank 2% reach is 47%
PayPal 12
and time per
American Express 2% American Express 7 person is 17
minutes

22



Key Takeaways
What is the mobile consumer doing on their device?

Apps are still king when it
comes to smartphones vs. the
mobile web

Successful apps leverage all
the key advantages of a social,
local and mobile smartphone

Smartphones have enabled
innovation in several industry
verticals such as retail and
finance
23


How does mobile compare to other
mediums such as TV and Online?

24


The smartphone audience is rapidly approaching
that of the PC…
Smartphone Users – Actual and Projected, US
All Mobile Subscribers A:13+ – Actual through Q2 2012
300 TV = 290M

250
Total Mobile = 237M

PC = 218M
200

142 148
150
126
115
107
95
100 86
79 Smartphone = 126M
72
65
58
49 51
39 44
50 34 37
24 30

0
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2008 2008 2008 2009 2009 2009 2009 2010 2010 2010 2010 2011 2011 2011 2011 2012 2012 2012 2012

25

Source: Nielsen
Note: Mobile Users A:13+; TV and PC A:2+

The average smartphone user, spends nearly an hour
a day consuming Mobile content
Average Daily Time Spent on Media Activity (h:mm)
Total Population, March 2012

0:39 0:01 0:10 5:37
0:04 0:09 0:03 0:09
0:13
0:49 0:11 0:23

Mobile
Mobile Web
0:32

Video
Online Video
Mobile App
4:47

Browsing
Streaming
4:32

Time Shifted
TV Viewing

Usage
TV

Online Web
TV

Browsing

Daily time spent among the total population
Daily time spent among users of the media type 26

Source: Nielsen

While TV still dominates for video viewing, Mobile wins
for convenience viewing
Q1 2012 Video Penetration among Monthly Time Spent among
the Total Population Video Users (hh:mm)

14%12% MOBILE 5:01

54% ONLINE 5:24

95% TELEVISION 155:46
27
Based on Total US Population, Persons 2+ for TV and Online, 13+ for Mobile, Q1 2012

Source: Nielsen

Smartphones are for snacking, while tablets are for
meals
Media Content Accessed Through Device
Mobile Connected Device Report, Q1 2012
Reach of
Netflix is
62% 25% on iPad
59% and 12% on
53% iPhone
51%
46%

4.0x
26% 28%28%
26% 25% 26%
23% 22%23%
2.9x 2.4x
4.2x
12% 10%
9%
6%

Books Movies Magazines TV shows News Social Downloaded Sports Streaming
Networking music radio

Tablet Smartphone

Mobile consumers frequently turn to tablets to consume 28
long-form content

Source: Nielsen Mobile Connected Device Report


The iPad’s larger screen drives different usage
patterns

Web vs. App Reach on iPad

92%
iPad’s bigger screen
78%
drives more…
67%
64%

Video Evening
Browsing
Viewing Usage
20%
11%

versus iPhone
Facebook Twitter Amazon
Web App
Consumers browse on the iPad

29



Engage with Mobile consumers while they watch
traditional TV

87%
of smartphone
owners use their
device while
watching TV

88%
of tablet owners
use their device
while watching
TV

30



Poll Question

What do you think the top activity is on a smartphone or
tablet when watching a TV show?

a) Looking up product info based on TV ad
b) Looking up coupons/deals related to TV ad
c) Shopping
d) Checking email
e) Browsing the web
f) Social networking
g) Using apps

31


Consumers use their Mobile devices for a variety of
activities while watching TV
Tablet or Smartphone Activities while Watching TV
Mobile Connected Device Report, Q1 2012

Checked email during 57%
the program 52%

Surfed the web for unrelated 55%
information during the program 36%

Used a downloaded 50%
application 43%

45%
Shopping
23%

Visited a Social Networking 44%
site during the program 40%

Looked up info related 38%
to the TV program 23%
Tablet Owner

Looked up product information 26% Smartphone Owner
for an ad I saw on TV 17%

Looked up coupons/deals 22%
related to a TV ad 12% 32



Key Takeaways
How does mobile compare to other mediums such as TV &
Online?

Smartphone audience is rapidly
approaching the PC audience in
terms of size

Despite the dominance of TV,
Mobile is gaining share from
being the ‘always available
screen’

Big opportunity to engage users
on smartphones and tablets
while they are watching TV!
33


How do consumers feel about
advertising on their mobile devices?

34


While users show more receptivity to advertising
Tablet Mobile advertising is becoming accepted, ads
with user benefits bolster acceptance rates

I am open to ads on this device if it improves
the range of media content available

1 in 3 Tablet 22%
tablet owners
and Smartphone 16%

1 in 5
smartphone owners
I don't mind ads on this device so long as
it is relevant to my interests
think advertising is
acceptable on the Tablet 22%
mobile device

Smartphone 15%

35



Gain trust of Mobile consumer over time and with
demonstrating value
To What Extent do you Trust the Following Forms of Advertising
Global Online Survey (Q3 2011 n=501)

Recommendations from people I know 91%

Ads in newspapers 48%

Ads in magazines 47%

Ads on TV 47%

Ads on radio 46%

Billboards 41%

Ads served in search engine results 36%

Ads on social networks 33%

Online video ads 33%

Online banner ads 29%

Display ads on mobile devices 27%

Text ads on mobile phones 26% 36

Source: Nielsen Global Online Survey


Privacy concerns can be overcome by earning
trust and showing relevance

Ads with Custom Location-Based
Offerings are More Useful - % Agree
Q1 2012 Mobile Connected Device Report

Ages 13-17 45%
Agree
30%
30% of users Ages 25-34 36%

find ads with
custom location- Ages 18-24 33%
based offerings
more useful Ages 35-44 32%

Ages 45-54 22%
Disagree
70% Ages 55+ 25%

37



Mobile advertising effectiveness shows promise

17% of tablet owners and 14% of smartphone owners
Clicked to view the full ad or product offering

Made a purchase through my device based on an ad I saw

Made a purchase on the Internet via PC

Searched for more info about a business I saw advertised

38



With some Mobile campaigns performing much
better than TV

Campbell’s Expanded iAd Performance
vs. Campbell’s TV Ad Norm – A18+
Campbell's Expanded iAd Campbell's TV Ad Norm - Broadcast/Cable Prime (11.1.10 - 12.09.10)

2.3X 4.7X 3.2X 5.4X

General Recall Brand Recall Message Recall Ad Favorability

39

TV Standard Ad Source: Nielsen, Broadcast + Cable Primetime; 11.01.10 to 12.09.10, A18+
Campbell’s iAd Data: Among Respondents who were exposed to and tapped on the Campbell’s iAd, A18+, Sample size (N=51)

Key Takeaways
How do consumer’s feel about advertising on their mobile devices?

There is still a delicate
balance between placing
relevant ads and
encroaching on privacy

When executed well on
mobile, ad recall and
favorability can surpass
other mediums

40


What have we learned about the mobile consumer?
1 • Rapidly growing group of smartphone owners
• Younger, higher income demos leading the charge

2 What is the mobile consumer doing on their device?
• Being social, keeping it local, and pushing industry verticals to evolve

How does mobile compare to TV and Online?
3 • Mobile relatively small for video consumption but growing
• Smartphones and tablets are complimentary to TV usage…

How do consumer’s feel about advertising on their
4 mobile devices?
• Open to mobile advertising that demonstrates value and convenience to
the consumer
41


Q&A
Visit our blog at:
http://blog.nielsen.com/nielsenwire/category/online_mobile/

Follow us on Twitter:
#mobileconsumer

If you have additional questions that were not addressed in the Q&A
session, please submit them to nielsenmediainsights@nielsen.com
by July 31.

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