It's amazing to think we are at the midpoint of 2011. How fast a year moves in our industry! Just last fall we were talking about the "birth of location media" at the iMedia Brand Summit in San Diego. Now location seems to come up in every conversation, and it's hard to deny the transforming effect on mobile, social, and commerce. And that, of course, means a transforming effect on advertising. While the beginning of summer is on most of our minds, back-to-school and the holidays will be here before we know it. Location and mobile will play a significant role in how consumers engage, shop, and interact. JiWire's recent Mobile Audience research of more than 5,000 on-the-go consumers highlights these key trends and provides insights that marketers can leverage for a successful second half of 2011.
Mobile is no longer a device
Mobile never really was just about a device; it's always been about an audience. The data on device ownership illustrates why this shift in thinking is so important. Today's on-the-go consumer owns, on average, 1.6 connected devices -- and that number continues to go up. Consumers aren't replacing devices but rather adding new ones. Next time you walk into a room, ask how many people own laptops, tablets, and smartphones. You'll be amazed at how many have all three. Tablets are a great indicator of this device proliferation. Thirty-one percent of survey respondents said they already own a tablet. More importantly, 40 percent said they planned to purchase a tablet, which will more than double ownership. In fact, of the top 10 non-laptop devices using public Wi-Fi, tablets grabbed two positions for the first time this past quarter. Advertisers must now think in terms of multiple devices and multiple content channels to reach people when they are mobile.
As an added note for tablet manufacturers, a third of the audience has no preference yet for what tablet they plan to purchase! This market is wide open.
Location gets more mindshare
In the past 12 months, there has been a mass market adoption of location-based services. There are tens of thousands of location-based mobile apps now available and even more that have added location as a feature. This is raising consumer awareness for location and changing how they see content, services, and advertising. In previous Mobile Audience Insights reports, 51 percent of consumers told us they are willing to share their location to get more relevant advertising. In more recent reports, we've drilled into what is driving that interest by looking at a range of services. First, consumer demand for location is not slowing. Overall interest in location services increased 11.7 percent quarter to quarter. Most notably, those claiming no interest in location declined from 22 percent to only 12 percent.
Within the set of location services, a few in particular saw strong growth. "Store locations" remained the top service at 57 percent. Not surprisingly, people like to find places easily! However, there is also real interest in being able to do things and find things in those locations. For example, "checking-in" saw the biggest growth in consumer interest in absolute numbers, increasing from 27 percent to 49 percent. The social aspect of location services also showed strong demand. "Connecting with others" rose from 12 percent to 32 percent. And in a sign of shifting demand from just "locations" to "stuff at locations," interest in "product inventory" information more than doubled from 10 percent to 21 percent of respondents. The last is a strong indicator that location is not only impacting social, but commerce as well. Consumers simply want location information right now. Marketers who can deliver local relevance and local information in their advertising can capitalize on this demand.
Mobile emerging as a real commerce platform
It's no secret that people have been buying goods and services from their mobile devices for a long time. And we all saw the shift in consumer behavior that began last holiday season with people really using mobile to research products and compare prices. But can mobile cross that hurdle to becoming a viable commerce platform like the internet?
The data suggests that is exactly what is happening. An astonishing 79 percent of respondents said they were comfortable making purchases from a mobile device. What's more, people weighed in with how much they are comfortable spending: Fifty percent of respondents are comfortable spending more than $100 on a purchase from their device, 20 percent were comfortable over $500, and seven percent more than $1,000. These results are a real indication that mobile has made the shift from just ringtones, wallpapers, songs, and app purchases for a few dollars to significantly higher ticket item purchases. This trend could transform shopping behaviors this holiday season.
Mobile, commerce, and location come together
Just as important as mobile becoming a true commerce platform is how mobile influences and drives those purchase decisions in the first place. When looking across industries, the research found very high percentages of people both researching and making purchases on their mobile device. Take the travel category for example: Sixty-two percent researched travel via their mobile device, but 42 percent also said they made travel purchases via mobile. That is a minimal drop off between research and purchase, which shows that mobile advertising can truly deliver a high ROI. That same pattern of research and purchase remained relatively constant across all verticals. The only exception is with music and apps, where research and purchase were about the same percentage. Clearly, buying a song on iTunes has become so seamless it's now an impulse buy.
Beyond the individual verticals, however, was how consumers described their most common mobile shopping behavior. Thirty-one percent said they research goods and services on a mobile device and then purchase in store. And that grew 5 percent in the last quarter. Leveraging mobile to deliver "clicks to bricks" types of location-based campaigns appears to align strongly with consumer behavior.
Consumers want to be rewarded
So what do consumers get for all this wonderful mobile shopping behavior? Convenience, information at their fingertips, and location content and services are all nice. But what they really want is to be rewarded. Local deals and group buying are appearing everywhere. One would think consumer demand is reaching saturation at this point.
Not so. Seventy-two percent of respondents said they purchase local deals and 44 percent at least once per month. Surprisingly there is little variation across gender and age groups. Men and women, young and old are all taking advantage of these offers, highlighting the mass market appeal of deals and promotions to drive purchases. In fact, 62 percent said they share a good deal with friends so all can benefit.
An interesting next six months
More than anything, the fact that demand for local deals shows no signs of slowing highlights how mobile shopping, the rising mindshare of local content and services have with consumers and social interaction are coming together. You've probably heard some variation on "LoCoSoMo" in the last month to reference the mash-up of social, local, mobile, and commerce. Consumers appear to be embracing this combination rapidly, and voting with their checkbooks. Tapping into these trends should make for some fantastic and innovative advertising campaigns over the next six months. The 2011 holiday season could be a wild one to reshape our industry once again.
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