Wednesday Dec 19, 2012 by Dan Katcher - CEO & Founder, Rocket Farm Studios
I did a NEDMA talk recently on how companies can focus marketing efforts through their mobile plans. The thesis of the talk was that in a world where everyone is accessing information through smartphones and apps that run on smartphones, you’d better be doing an app. If your marketing efforts are not considering apps as a way to reach and interact with customers, then you as a company risk losing relevancy. Put another way, innovative companies recognize that mobile first or mobile only is a great strategy – it’s a mobile world, it’s an app world, and the sooner you figure out what to do about that the better.
Here’s some supporting evidence, courtesy of a lot of smart people who have done a lot of smart modeling, surveying and projections.
Mobile is without a doubt global. Check out this chart about the growth of mobile globally. The dark line at the top represents the growth in handsets globally. The orange line represents the growth in smartphones globally. Let’s be clear – smartphones are a) iPhones, b) Androids, or c) maybe Windows? (Sidebar: the folks at the AT&T store I visited this past weekend said that Windows phones are indeed selling at a pretty brisk rate, so more to come on that front because it also depends on the developer community. And we’ll see if BB can recover.) So almost 2 billion smartphones today; some 5 billion predicted in 5 years.
You can access every consumer in the world through a device that is
always connected, has gobs of sensors, and amazing rendering
capabilities visually and audibly. Implications are and will continue
to be staggering.
The following graph (Figure 2 from here) is Cisco’s projection of data traffic world wide from mobile. It goes in one direction – up. What’s remarkable about this is that it is consistent across all regions of the globe. Consistently large. What’s even more fascinating is that the growth is especially strong in areas other then the US. Mobile is global – remember?
The second graph is even more remarkable – data traffic in India from mobile has already surpassed data traffic from laptops and desktops. Let’s think about that. India is skipping the need to wire all parts of its country with fixed landlines and going right to mobile. So if you’ve read The World is Flat, what’s especially interesting is that outsourcing (at least from a US perspective) to India originally was made possible because of the tremendous capital outlays in fiber back in the Dot Com days. Now, they’re skipping well past that in India to take advantage of the build out of infrastructure from mobile. The world is quickly transitioning to source more and more communication of all kinds (voice, data, video, apps) via smartphones, not laptops or desktops.
More data points – these following two graphs show the fast growth in mobile advertising and the projections looking forward. It’s inevitable, as more and more people move their lives to #MobileOnly, the advertising is bound to follow. In 2012 it’s looking to be a $1.2b industry. The first chart shows the percentage of ad spend by format, with mobile being the fastest growing segment as detailed here.
This following graph examines the forecast of mobile over the next 3 years, and clearly illustrates the tremendous growth that is yet to come.
What is also interesting is that mobile ads, if done right, can be
tremendously effective. A great summary of Facebook’s experience and
success in mobile ad serving can be found here.
Facebook has found that their ability to monetize via mobile is very
strong, with mobile users 15x more likely to click and 22% more users
likely to comment on an article. And this article covers the top reasons why 2012 is seen as the year when mobile ads finally have taken off.
Mobile apps are projected to generate $38b by 2015. The NY Times Bits blog from earlier this year has a story from earlier this year with these projections.
And that revenue is continuing to grow at a remarkable clip. Both Google Play and the Apple App Store are growing at consistently big rates:
Here’s some more remarkable stats: check out this chart which shows that Apple now moving more apps then tunes. The article this is taken from estimates that Apple is likely making more money from apps then tunes.
Of course that good news is majorly tempered by the recent report that half that revenue is going to just 25 developers, most of them game publishers: http://www.businessinsider.com/top-25-app-makers-revenue-share-2012-12
Here’s the kicker: more time is being spent in Apps then in Browsers on Mobile. This post from Flurry clearly illustrates where time is being spent by mobile users and the trend towards apps vs browsing:
Build apps. For B-B relationships, it’s obvious – your customers are on mobile. For B-C relationships, it’s obvious, but clearly risky to assume you have a clear path to a top spot in any particular store. It really does require a comprehensive plan for designing, building, marketing, and all the other countless things you have to do to make a business initiative a success. Ultimately the catchy term B-E (where E = everywhere) does make sense, whether it’s another business, a consumer, or an internal enterprise app.
Keith Teare said it best in this amazing article: “Any company that isn’t primarily delivering its service via mobile five years from now will probably be irrelevant.”
Whether it’s mobile first or #MobileOnly, the conclusions are pretty clear.
Dan Katcher is the CEO & Founder of Rocket Farm Studios. You can find this blog post, as well as additional content on the Rocket Farm Studios' blog. You can also follow Dan on Twitter (@genericdan) by clicking here.