Loyal App Users Cost $3 to Secure

Teenage hipsters using phone in cityThe cost to acquire a loyal app user has surpassed the $3 (£1.95) mark for the first time, according to the latest Fiksu Indexes produced by the mobile marketing technology company.

According to the regular study by the company, the cost now stands at $3.09, a 10 per cent increase since last month and 113 per cent rise year-on-year, with the growth representative of a larger trend that reflects the expanding power of mobile marketing to reach app users.

Increases in costs and competition have both been observed in line with worldwide trends that are seeing mobile spending increasing globally, with mobile ad spend predicted to overtake web ad spending by 2016, and 75 per cent of ad spending for mobile occurring inside apps.

As the competition for the attention and loyalty of app users grows more intense, marketers are shifting from simple downloads to engagement as a metric for success, especially given stats that indicate many apps are only used once or twice by most consumers.

“As we enter another record-breaking month, brands must face the inevitable rising tide: mobile marketing is maturing and becoming more expensive,” said Micah Adler, CEO of Fiksu. “To stay ahead in this evolving market, marketers must continually adjust and take advantage of programmatic media buying methods to spend marketing budgets as wisely as possible.

“Sustainable success will be found by brands that use more precise forms of targeting to reach the right mobile users: those who will engage with an app and become loyal over the long term.”

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Mobile Payments on the Up

Palm paymentsOnline payments made using mobile devices accounted for 27 per cent of total online payments made in Q1 2015 – up from 25.8 per cent on the traditionally high online spending period of Q4 and up a massive 39 per cent on the corresponding period last year. The figures come from payment tech company Adyen’s quarterly Mobile Payments Index, which tracks mobile payment data from web-based transactions across its customer base.

The average transaction value (ATV) of digital goods bought via tablets has surpassed the figure for desktops/laptops for the first time since Adyen began publishing the Mobile Payments Index in June 2013.

US growth
The US market showed impressive growth in Q1, with 27 per cent of payments online being made on mobile, an increase of nearly five percentage points over the past six months. This rate of growth compared favourably with Europe, which increased only two percentage points in the same period. Europe led the way overall, however, with 28.6 per cent of payments online made with mobile. Meanwhile, Asian markets have for the first time broken the 20 per cent barrier for online mobile payments.

In terms of individual markets, the UK stands head and shoulders above the global averages. In Q1 2015, 44 per cent of online payments in the UK were made using a mobile device up from 36.9 per cent for the corresponding period in 2014 – with smartphones accounting for 66 per cent of that figure compared with 64.9 per cent in 2014.

ATV rising
The Index shows that the average transaction value for the digital goods industry has risen across all platforms over the past 12 months. Digital spend online increased 28 per cent and 30 per cent respectively for desktops/laptops and tablets, but the greatest leap was over mobile devices, where the ATV rose 37 per cent year-on-year to €28.27 (£20.39). While smartphones are growing fastest, the quarter saw tablets with an ATV of €32.66 surpass desktops/laptops (with an ATV of €31.19) for the first time.

ATV on smartphones may be lower than for tablets, but in pure volume terms the gap between spending on smartphones and tablets has widened dramatically. In March 2014, smartphones accounted for 10.9 per cent of online transactions, compared to 9.3 per cent for tablets. By March 2015, smartphones accounted for 16 per cent of online transactions, compared to 11.5 per cent for tablets – reflecting an almost 300 per cent increase in the gap between smartphone and tablet share. In the same period of time, desktops dropped from 79.8 per cent of online transactions to 72.5 per cent.

“Tablets may well be approaching market saturation but thanks to retailers and businesses focusing on optimizing the payment process for the channel, they are attracting increasing spend as consumers become more comfortable using these devices to pay for things online,” said Roelant Prins, chief commercial officer at Adyen. “There has been a seismic shift in how and where people are comfortable spending money. All mobile channels in the past 12 months have experienced impressive uplift.”

iOS versus Android
In the battle of the smartphone operating systems, Apple still rules the roost, but Google and the Open Handset Alliance are closing the gap. iOS ended Q1 2015 with a 65 per cent market share of online mobile payments, down from 69.5 per cent last year. Meanwhile Android claimed 34.9 per cent at the close of Q1 2015, up from 30.3 per cent in Q1 2014. Android may be closing the gap on iOS, but the Apple percentages are much more balanced than Android across devices – in Q1 2015, iPads accounted for 47.2 per cent of iOS mobile payments, versus 52.8 per cent for iPhones, while for the same period Android mobiles made up 78.2 of the total Android payments.

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Apple Watch Rollout Delayed by Faulty Component

Apple WatchApple is reportedly shifting production of a key component in the Apple Watch to a new supplier after faults have led to considerable hold ups in shipping models out, and led to Apple struggling to keep up with demand for the much-hyped wearable.

According to The Wall Street Journal, the taptic engine, which simulated the feeling of being tapped on the wrist, is the cause of the delays, with engines breaking down rapidly, and Apple even forced to scrap existing watches due to the defect.

The fault is only present in taptic engines produced by AAC Technologies, which has seen its shares drop eight per cent this morning following the news being made public. Apple’s other supplier, Nidec Corp, are not experiencing the same problem, and for the time being will be responsible for all production, although it will take time for them to ramp up to this scale, resulting in further delays to Apple Watches being delivered to customers or available in stores.

According to market intelligence firm Slice, only 22 per cent of Apple Watches that were pre-ordered were delivered during the first weekend the device was available. 1.7m watches were ordered ahead of the product’s launch, but only 376,000 were delivered initially, with 547,000 expected to ship before 11 June, and 639,000 awaiting notification from Apple as to when they can expect to receive their watch.

Slow delays and faulty components aren’t the only frustrations facing Apple Watch owners as they receive their new devices – wearers with tattoos are reporting that the watch, which is supposed to unlock automatically when it senses it is being worn, is not working when worn over skin with black tattoos.

Tattoos also reportedly disrupt alerts for incoming messages, and heart rate readers differ significantly on tattooed and non-tattooed wrists. The Apple Watch uses green LED lights combined with light-sensitive photodiodes to detect blood flow, and Apple’s support website does mention that tattoos may interfere with its functions, but does not mention any other expected difficulties.

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Twitter Pays $532m for Ad Targeting Firm

twitter tellapartTwitter has purchased ad targeting firm TellApart for $532.6m (£345.5m) in stock, in an effort to strengthen its cross-device retargeting and direct response capabilities, making it more appealing to marketers.

The purchase was first announced during the firm’s Q1 earnings call yesterday, as Twitter announced disappointing results for the first quarter of 2015, with below-expected revenues and a larger overall loss than it saw in Q1 2014.

The acquisition will enable Twitter to more effectively target ads at more precise groups across its various channels, as well as through TellApart’s ad specialists, as the social network aims to make itself more appealing to marketers.

“Consumers now move fluidly between apps, devices and platforms, and performance advertisers are in need of more effective targeting and measurement tools that work seamlessly if, say, someone browses for products on a mobile device but ultimately makes a purchase on a desktop device,” said Kevin Weil, senior vice president of product for Twitter. “Offering this seamless experience is an ongoing priority for us, as it is for the advertising industry as a whole.”

“One of the biggest challenges facing marketers today is the fractured nature of the consumer experience – across devices, between the web and apps, and between the digital and physical worlds,” said Josh McFarland, co-founder and CEO of TellApart. “While there are no silver billets to solve this problem for advertisers, we believe that by working together with Twitter we can considerably improve the experience. On desktop, advertisers on our platform reach the right consumers at the right moments, and working with Twitter, we’ll be able to do more for our advertisers to find the right consumers on either mobile, desktop or both.”

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Digital Distribution Firm ironSource Opens UK Offices

ironsourceDigital delivery company ironSource has opened an office in London to better serve its UK and European clients, with increased support for publishers and advertisers making use of its mobileCore range of products.

“Just as we’ve helped publishers and developers in America and Asia access more of the right target users and monetise more effectively, we’re excited to be able to help European companies grow into successful international businesses,” said Daphna Giniger, director of UK for ironSource. “ironSource is channeling its resources, technology and relationships to bring innovative solutions for mobile app developers, publishers, carriers and device manufacturers.”

The company offers a cross-platform ecosystem for apps that aims to deliver a solution for distribution, delivery and monetisation, enabling developers to connect with users across devices. It currently handles over 7m installs a day, with over 70,000 applications utilising its mobileCore SDK.

“Digital advertising in the UK is exploding, with digital media spend set to overtake all other advertising formats in 2015,” said Tomer Bar Zeer, CEO and co-founder of ironSource. “With our comprehensive mobile app distribution solutions, it makes perfect sense for ironSource to establish a local presence in such a key growth market.”

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IoT Platform Revenues Worth £1.7bn Worldwide by 2020

Internet of Things connected homeInternet-of-Things platforms are predicted to grow to a £1.7bn industry over the next five years, with total IoT platform revenues forecasted to grow by at a compound annual growth rate of 32.2 per cent.

According to research by analyst firm Berg Insight, IoT platform revenue will increase from 450m (£326m) in 2014 to 2.4bn by 2020, with third party IoT platforms driving a growth in diversity of functionality and application areas.

Most IoT platforms focus on either connectivity management, device management or application enablement, allowing companies and organisations to develop and deploy solutions faster and at a lower cost by offering standardised components that can be shared across multiple solutions in different industries.

“M2M often involved highly customers solutions deployed within single industry verticals or companies to improve existing business operations,” said André Malm, senior analyst at Berg Insight. “IoT focuses on gaining new insights from analytics based on data from diverse sources to support decision making, and improve products and services.

“In the past, companies have often developed M2M solutions where connected devices sent data via a network directly to an application that handled data storage and processing, security and business logic. These solutions normally required long development cycles and high cost, with little scalability and flexibility to handle a growing number of devices and evolving functional requirements.”

As the market for connected devices grows, more and more platforms are embracing multi-purpose structures that will enable them to service multiple industries in a variety of ways, leading to a new generation of platforms that can be adapted to business needs easily and quickly.

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BrightRoll Expands Mobile Video Ad Suite

brightrollYahoo-owned digital video firm BrightRoll has expanded its suite of mobile video solutions with the aim of helping advertisers maximise the impact their campaigns have across various screens and devices.

Advertisers running programmatic video campaigns on the BrightRoll DSP will gain access to a holistic set of mobile tools that are designed to better measure ad effectiveness, simplify implementation and increase reach of mobile app campaigns.

Mobile ad spending is expected to increase 60 per cent this year to $64bn (£41.7bn) and hit $159bn by 2018, with the growth in mobile video one of the key drivers in this meteoric growth. BrightRoll has been one of the pioneers in mobile advertising, having launched the first mobile video real-time bidding solution in 2012.

“Mobile advertising has experienced impressive growth, but the majority of marketers are still uncertain about how to execute and verify the effectiveness of their mobile video campaigns,” said Tod Sacerdoti, CEO and founder of BrightRoll. “Mobile has always been an important area of focus for us, and we are doubling down on our efforts to give advertisers the ability to measure performance across the breadth of devices to better understand their target audiences and effectively spend marketing dollars.”

Among the updates to BrightRoll’s offering is the integration of Nielsen Digital Ad Ratings into the firm’s DSP, providing advertisers with more in-depth insight into campaign performance, and MRAIN Video Addendum, enabling simplified mobile video executions, and improved measurement of video ad reach and impact.

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Case Study: Audi A3 Sportback e-tron Pop-up Store

audi popup store exteriorOn 12 January this year, Audi opened its first ever pop-up store at London’s Westfield shopping centre. The store was conceived as a brand experience to support the launch of the Audi A3 Sportback e-tron, the first hybrid car to be derived from a UK best-selling premium hatchback. The car couples a 75kW electric motor with a 1.4 TFSI petrol engine, delivering the potential for up to 176mpg with CO2 emissions of just 37g/km.

Audi set out to resolve customer confusion around how hybrid vehicles work and particularly around recharging. The auto brand developed the store concept to foster greater understanding of and excitement about the vehicle, using a real car, augmented reality (AR) and virtual reality (VR) tech to educate visitors. Audi partnered with mobile marketing firm Somo to deliver the in-store tech.

audi e-tron carUsing a physical e-tron car as a trigger, an AR iPad app visually displayed how to charge the vehicle to further emphasise how easy it is to own the hybrid. Another iPad app allowed visitors to configure their own custom model, while Oculus Rift virtual reality headsets let them experience what it was like to drive the car, even if they weren’t old enough to drive it in real life.

Finally, the virtual e-tron zone allowed visitors to use static triggers to access 3D models of the engine, battery and motor, giving a thorough look at what is under the hood of the car.

Using technology inside the store to bridge the physical and digital worlds, Audi and Somo were able to create a fun experience that helped to demystify the e-tron and get visitors excited about the launch of the new vehicle.

audi ipad popup storeThe store proved a hit with consumers, attracting more than 7,800 visitors over the four weeks it was open. More than 10 per cent of these went on to book a test drive with Audi.

“The footfall figure of just 7,800 visitors in four weeks is incredible when you compare that with the average footfall going into an Audi dealer,” says Audi UK national communications manager, Sarah Cox. “We will definitely evaluate further pop-up stores for the future.”
There’s more on the Audi e-tron pop-up store here.

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Twitter Disappoints with Q1 Results

Twitter bird logoTwitter has unveiled disappointing results for the first three months of 2015 following what it described as “a lower-than-expected contribution from its newer direct response products. The company said it expected this revenue impact to continue for the remainder of the fiscal year. Shares in Twitter fell 18 per cent at the close of trading on the back of the results.

The firm generated revenues of $436m (£284m) during the quarter – it had previously forecast revenues of £440-$450m – and posted a loss of $162m, compared to a loss of $132.4m in the first three months of 2014. It said it expected the negative impact on its revenue to continue for the rest of the financial year. There was some cheer from Twitter, however, in its monthly active user numbers, which rose 18 per cent year-on-year to 302m in the first quarter. 80 per cent of these were mobile.

“It is still early days for these products,” said Twitter chief executive Dick Costolo. “We have a strong pipeline that we believe will drive increased value for direct response advertisers in the future. We remain confident in our strategy and in Twitter’s long-term opportunity, and our focus remains on creating sustainable shareholder value by executing against our three priorities: strengthening the core, reducing barriers to consumption and delivering new apps and services.”

Twitter also announced two moves designed to strengthen its direct response capabilities. Firstly, it has struck a deal to acquire TellApart, a marketing tech firm specialising in cross-device retargeting via advertising and email marketing.

Twitter also unveiled a partnership with Google’s DoubleClick platform to improve advertising performance measurement and attribution for Twitter direct response marketers. As part of the partnership, Twitter will also make its inventory available through the DoubleClick Bid Manager (DBM) making it easier for clients who prefer to centralize their buying through DBM to create and manage campaigns on Twitter.

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Sky Hands Mobile Ad Task to InMobi

Sky Sports appSky’s ad sales arm, Sky Media, has appointed mobile ad firm InMobi to monetise its apps and mobile sites. Sky boasts some of the UK’s most popular apps and mobile sites, including the sports apps, Football Score Centre and Sky Sports, its news app, Sky News. Sky’s apps and mobile properties see 20.7m unique users each month and are expected to generate over 1.5bn ad impression views per month. The companies say the partnership offers a great opportunity for brand advertisers to reach highly targeted and segmented audiences across Sky’s properties.

“InMobi offers a comprehensive and compelling mobile advertising platform for premium publishers and brands alike,” said Sky Media revenue and strategy controller, Hitesh Bhatt. We selected them as a sales partner after a rigorous evaluation process. Their powerful targeting technology and heritage in mobile will help Sky to build out its mobile offering alongside opportunities sold by our direct sales team.”

InMobi’s network reaches over 1bn monthly active unique users, processing more than 6bn ad requests each day. Of this, Europe accounts for over 230m monthly active uniques.

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