The Mobile Opportunity Gap - Kenshoo and Yahoo Webinar

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© 2014 Kenshoo, Inc. Confidential and Proprietary Information
The Mobile Opportunity Gap:
August 7th, 2014
Analysis of Consumer Shopping Behavior & Multi-Device
Advertiser Strategy

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Webinar Information
Audio Instructions
• Listen via computer speakers or use phone numbers listed in email from
gotowebinar@citrixonline.com
• Still can’t hear the webinar? Tell us please!

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Today’s Speakers
Will Crew
Director of Product Management, Mobile,
Kenshoo
Edwin Wong
Sr. Director of B2B Insight, Yahoo

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Agenda
• Consumer Shopping Trends – Yahoo
Findings
• State of Mobile Advertising
• Advertiser Three-Screen Perceptions –
Kenshoo Findings
• Key Imperatives for Marketers
• Q&A

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Smart Mobile:
How mobility permeates our lives

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Column1 2012 2013 2014 2015 2016 2017 2018
Growth of mobile & tablet ownership will
continue trending up…
Smartphone & Tablet Ownership | eMarketer
Source: Yahoo/Ipsos MediaCT Mobile & Tablet Consumption Survey, June 2014, 18-64
2012 2013 2014 2015 2016 2017 2017
100%
50%

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… which have increased digital mobile time
spent by 5X
Source: comScore US Media Metrix Multi Platform data
MAY 2010
APRIL 2014
Time spent online,
billion minutes
PC
Smartphone
Tablet
127%
more time spent online
than in 2010
Minutes Spent Online by Device

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What does this tiny device even mean?

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The 4 C’s:
Digital
Connective
Consciousness
CultureContentCommunityCommunications+ + + =

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61%
51%
37%
30%
25%
21%
20%
13%
13%
12%
12%
12%
11%
11%
Check/Send Email
Text/IM
Use Search Engines
Weather
Online Video Content
Online Games
Read News (i.e. local/national/world)
Listen to streaming radio/music
Post/Share/View Photos
Shop/Browse shopping sites/ Apps
Entertainment Content
Sports Content
Lifestyle Content (i.e. Food, Beauty)
Finance Content
In fact, mobile daily habits have formed around
communication and content
Top Mobile Activities (% Daily, Smartphone Users)
46%
of mobile users
access content at
least daily

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Previously, usage spiked at specific points in
time, leaving gaps for “Life”
An ebb and flow of usage, leaving both small and wide gaps
throughout the day
TIME
Television
Laptop
Desktop
Smartphone

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Now, convenience of multiple devices allows
consumers to fill in the gaps
Consumers no longer access single devices at specific
points in time for specific activities or occasions.
TIME

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Creating continuous usage, allowing for
greater accessibility, connectivity, & efficiency
Technology is used continuously throughout the day –
leaving no gaps in time
TIME

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Shoppers are behaving in new ways
Instant information at their fingertips, improved Mobile and Tablet site usability, shopping
apps and improving technology enable the shopper to behave in completely new ways.
Dynamic and Evolving
Shopping Experience
Rapidly improving
technology
Increasing consumer
confidence and demand

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Explosive growth in leveraging our mobile
devices for shopping information…
Number of Mobile Shoppers Growth from 2011
Finance 76M +145%
Entertainment Items 69M +103%
Home Improvement 56M +180%
Restaurant & Dining 54M +62%
Personal Travel 54M +108%
Consumer Electronics 51M +93%
Clothing & Accessories 51M +104%
Beauty & Personal Care 47M +135%
Package Goods & Beverage 40M +100%

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…and we aren’t the only ones talking about
this growth
~25% of
Thanksgiving
&
Black Friday
sales driven by mobile,
a +43% increase
Estimates that mobile
transactions will top
$114 Billion in 2014,
a 1/3 of all digital
transactions
Projecting mobile retails
sales will be
$626 Billion
by 2018

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43% of tablet owners
believe their tablet is
critical to my daily life
More than 50% say their
mobile devices makes
them browse the internet
more
67% of mobile owners
believe their mobile is
critical to my daily life

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Mobile shopping is omnipresent. Always on
always going…
IN STOREGETTING SOMEWHEREAT HOME WHILE WAITING IN LINE

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84%
36%
51%
46%
92%
30%
46%
42%
Mobile Tablet
IN STOREGETTING SOMEWHEREAT HOME WHILE WAITING IN LINE
While mobile shopping is on-the-go, it really
starts at HOME
I use my Mobile/Tablet to access <category> shopping related information in this location

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Most users claim to use their PC in addition to
their mobile and tablet devices
Mobile Tablet

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MOBILE TABLET
Disappointed companies don't have optimized site 44% 50%
Disappointed companies don't have application 38% 47%
I am less likely to re-visit a brand’s site if it wasn't optimized for my mobile device the first time I visited it 38% 44%
MOBILE TABLET
Filling out forms on my mobile phone is difficult 61% 46%
Brands-Manufacturers-Retailers have not made it easy to redeem coupons on my mobile device while in-store 36% 37%
I am sometimes unsuccessful at making payments using my mobile device 27% 26%
There is ample opportunity to improve the
consumer brand experience on mobile devices
BUYING STUFF
SITE EXPERIENCE

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MOBILE TABLET
Used a map to navigate 52% 50%
Took/sent product picture 34% 29%
Scanned Something 30% 32%
Looked for/downloaded apps 23% 30%
“Checked in” at a location 22% 24%
OTHER
Search
Reviews Sites
Deal Sites or Apps
Product & Price Comparison
Communication about Product
Noticed/Clicked on Advertising
75%
72%
54%
49%
45%
34%
75%
63%
59%
61%
43%
43%
81%
59%
54%
70%
21%
43%
It’s about the basics: search, review sites, &
community are important during buy cycle
I used my device to do the following…

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Tablet rivals PC as being a helpful device
throughout the purchase path
Helpfulness of Device in Purchase Path

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ENTERTAINMENT
CASUAL DINING
BEAUTY & PERSONAL CARE
FOOD & BEVERAGE
TRAVEL
APPAREL
CONSUMER ELECTRONICS
79%
80%
76%
78%
53%
66%
53%
59%
66%
76%
61%
77%
55%
60%
Mobile & tablet shopping research results in
purchase behavior offline or via PC
Actions After Mobile/Tablet Research: I made a purchase/enrollment via any method
Mobile Tablet

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HOME IMPROVEMENT
INVESTMENT
INSURANCE
CREDIT CARD
HEALTH
BANKING
AUTO 24%
28%
28%
46%
38%
46%
39%
50%
40%
51%
42%
55%
53%
60%
Actions After Mobile/Tablet Research: I made a purchase/enrollment via any method
Mobile Tablet
And it’s also a driver of purchase for lower
incidence categories

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ENTERTAINING
BOLD
UP TO DATE VALUE
INTERACTIVE
FUNCTIONS
43%
41%
39%
32%
35%
39%
WOULD CAPTURE MY ATTENTION
Bold & interactive ads that take full advantage
of the device are most appealing to consumers
Mobile/Tablet Advertising Preferences – Ad Copy

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Auto Apparel/Fashion
Beauty/Personal Care Consumer Electronics
Food & Bev Home Improvement
Banking Entertainment
Credit Cards Health
Insurance Travel
Investment Dining
Mobile/Tablet Advertising Preferences – Category
Relevant to current
location/local area
Offers/Coupons/
Promotions/Incentives
Relevant to
interests/background
For most categories, top 3 ad tactics revolve
around location, relevancy and promotions

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Categories elicit different ad tactics
Mobile/Tablet Advertising Preferences – Category Differences to total

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State of Mobile Advertising

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Mobile Ad Spend Accelerating
• Marketing budgets continue to shift from
offline to digital
• Digital to reach $50B by 2015
• Mobile to be +50% of total digital by 2017
$70 Bn.
$0 Bn.
$10 Bn.
$20 Bn.
$30 Bn.
$40 Bn.
$50 Bn.
$60 Bn.
2013 2014 2015 2016 2017
Digital Ad Spend Mobile Ad Spend
22.55%
of digital
39.81%
of digital
56.69%
of digital
Source: eMarketer, Dec 2013

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Global marketers prioritize desktops
Advertisers are still significantly prioritizing budgets to computers, with most applying roughly an
80-20 split: 80% to desktops, 20% to mobile devices.

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Kenshoo Clients Increasing Mobile Spend Share
Spend Clicks
Q2 2013 Q2 2014 Q2 2013 Q2 2014
Global 21% 29% 24% 32%
U.S. 20% 28% 24% 33%
U.K. 25% 36% 28% 38%
A.U. 28% 35% 31% 44%
Source: Kenshoo Search Advertising Trends – Q2 2014

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$0.40
$0.45
$0.50
$0.55
$0.60
$0.65
$0.70
Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014
Global CPC by Device
Desktop
Phone
Tablet
Desktop Still Carries Price Premium
Source: Kenshoo Search Advertising Trends – Q1 2014
$0.65
$0.61
$0.55

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Mobile Performance Trails Desktop
2%
20%
14%
27%
37%
How would you rate the performance of your mobile
paid search efforts when compared to desktop?
Mobile performs much better than desktop
Mobile performs slightly better than desktop
Mobile performs about the same as desktop
Mobile performs slightly worse than desktop
Mobile performs much worse than desktop
Source: Kenshoo Marketer Survey: Enhanced Campaigns One Year Later

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Mobile Opportunity Gap

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Consumers increasingly using all 3 screens as
part of purchase journey
99% of respondents agree that the
interplay of paid search across
devices carries at least some
impact on consumer conversion

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Mobile is at the forefront for shopping research
92% of marketers recognize that
mobile search is becoming an
increasingly prominent activity for
consumer shopping research

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Advertisers view paid search as a mid-funnel
driver
55% of marketers find paid search
ads on smartphones are most effective
at driving research and browsing
activity

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Price comparison is the main in-store activity
of shoppers on smartphones
73%
of marketers feel that
consumers are likely
to use their mobile
device to do price
comparisons while in
a store or place of
business

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Smartphones lag when it comes to consumer
purchasing actions
53%
of marketers feel that
consumers are “very
comfortable” making a
purchase on a tablet as
opposed to the 20% who
believe they are on a
smartphone

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“ “
We asked marketers how consumers would react to the following
statements…
62% thought consumers would be
unlikely to return to a non-optimized site
I’m less likely to revisit a
brand’s site if it wasn’t
optimized for my mobile
device on the 1st visit…
I’m disappointed when
brands don’t have
mobile-optimized
sites
82% felt consumers are disappointed
when reaching a non-optimized site

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Marketers’ cross-device strategies are lagging
behind…

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…Yet most feel their own organizations are
aligned

45
Advertisers missing the mark on customized
device strategies
77%
of advertisers either take the same approach
or only slightly vary ad copy by device

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Optimization is key to unlocking improved
mobile performance
9%
34%
11%
46%
Mobile-specific ad
copy
Mobile bid
adjustment
Mobile ad
extensions
Mobile-optimized
landing pages
Many factors influence the
performance of mobile
search; however, 46% of
marketers believe that mobile-
optimized landing pages have
the greatest impact on overall
performance.
Which aspect of mobile paid search do you feel has
the greatest impact on overall performance?

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Marketers have an opportunity to grow!

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Approximately
half of marketers
feel they are
already providing
rich mobile
experiences, but
when it comes to
deeper, more
sophisticated
tactics, there is
room for growth.
Marketers have an opportunity to grow!

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Key Imperatives for Marketers

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1. Establish Concrete, Device-Specific Goals
33%
4%
33%
2%
9%
19%
Online Traffic
In-store Traffic
Direct Sales
App installs
Phone Calls
Other conversion activity
Source: Kenshoo Marketer Survey: Enhanced Campaigns One Year Later
What is your mobile paid search goal?

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2. Integrate Multi-Device Marketing into a
Holistic Marketing Plan

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3. Understand & Leverage Device Signals
Location Device Time of Day

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4. Fulfill Customer Expectations

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Download the Full Report for More Insights
Kenshoo.com/Mobile-Opportunity-Gap

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Q&A

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Thank You!

The Mobile Opportunity Gap - Kenshoo and Yahoo Webinar

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