Mobile Fix: The Sao Paulo edition
Simon Andrews, founder of the full service mobile agency addictive!, on mobile advertising; Facebook making money; mobile disruptive music and Amazon…
Writing this in the @PontoMobi office in Sao Paulo – following a two day workshop as part of a global pitch, where we’re down to the final stage. 26 degrees and caipirinhas have defined the week – as well as hard work, smart thinking and great hospitality.
Mobile advertising
Smart analytics company Flurry have stirred up the mobile advertising world with their claim that the huge growth in mobile inventory means it could ‘absorb’ the desktop ad world. Many have questioned whether this is actually a good thing and, to us, it’s apparent that mobile advertising needs to answer some of the questions online advertising has struggled with.
Despite clear evidence that online advertising can and does build brands – and actually outperforms TV ads for FMCG brands in some cases – many still question its validity. Mobile needs to demonstrate that it can deliver against brand metrics and that engagement on mobile is valuable. We also need to provide evidence that attention within a premium environment is more valuable than in non-premium sites or apps. The IAB study with John Lewis is a good start, but we need more. With new comScore data showing that mobile ads are working on UK youth – 31% recall seeing mobile ads – the potential is clear.
We’re developing some thinking around this space – using some of the great work done by Robert Heath on Low Involvement processing – and we’d be interested in hearing from anyone who would like to get involved.
In a further sign of the sector maturing, Google have chosen to reorganise their two mobile ad products by allocating AdMob to app developers and AdSense to mobile web publishers. Some question whether this sort of thing perpetuates the apps vs mobile web debate that we hoped was abating.
Facebook making money
Leaked data shows that Facebook revenues are up to around double last years – suggesting their $80 billion valuation isn’t that absurd. And at just $1 revenue for each user they obviously have room for colossal growth. But should we worry about user numbers slowing. The global perspective is quite interesting; with strong ‘local’ players like Orkut here in Brazil and QQ etc in China, are Facebook running out of new markets to conquer?
Doubts over participation need to be balanced against the news that Barcelona now has over 20 million Facebook fans. And we recently heard Tom Bedecarre of AKQA talk of how clients are now setting targets for the number of Facebook likes they have – everyone wanting five million or 10 million. But do brands know what to do with these fans once they have them? Are they building a dialogue with their most valuable customers?
Mobile disrupting music
We all know how digital disrupted the music business and the battles continue between Google, Apple, Facebook and Amazon over music in the cloud. Is live music mobile is being just as disruptive?
We wonder whether there is potential for mobile to create new revenue streams for music. In the past, album covers and CD notes provided value to buyers of music – could apps provide similar value to people who buy MP3s?
The Black Eyed Peas app has done well, providing a new experience for fans and a new revenue stream for the band. And Bjork added an additional dimension to her last album with a whole suite of apps.
Significant value is also being created by new ways of packaging music – could there be a role for brands here to curate music for their customers?
Disruption can be just as much about creation of new business models, as the destruction of old ones.
Amazon – the most disruptive company?
When we started including Amazon in our GAFA model, many people questioned whether they were on the same page as Google, Apple and Facebook. In recent months that question has gone away – but we were intrigued by the excellent Wired article, which suggests that Amazon has swiftly become the most disruptive company in the media and technology industries.
Their big news is the Kindle tablet and there are more and more stories emergimg about what it will offer. As part of the preparation, Amazon are reportedly redesigning their website – a very big deal when you have the most successful ecommerce site in the world. Most ecommerce players live by the rule, ‘if it isn’t broke, don’t fix it’, and satisfy themselves with ongoing a/b testing to look for marginal improvements.
But Amazon are under some pressure in one part of their business – independent app store GetJar is pushing their Android offering with promotions of free premium apps. We expect the whole area of app distribution and discovery to mature in the coming months, with smart promotions becoming the norm. Our favourite example is EA slashing the prices on their top games last December. At Christmas they put the prices back to normal, and cleaned up by dominating the best selling charts on the App Store (EA games held the #4, #7, #8, #10, #11, and #12 spots in paid iPhone apps and the #1, #2, #4, #7, #9, #10 spots in paid iPad apps through the holiday charts freeze.)
Finally
One piece of learning from our pitch; it’s clear that the current artisan approach of building bespoke apps is evolving towards a platform based solution, where smart use of APIs can deliver the most appropriate content and services to the individuals device(s).
This integrated approach means we need to consider desktop usage as well as mobile devices and connected TVs. The new appstore for Chrome is a good example of how worlds are colliding – the team at PontoMobi are about to launch 20 Chrome apps, commissioned by Google – for some of the biggest brands in Brazil.
And Seth nails it again with a must read post on talent and vendors. We see ourselves as talent and count ourselves lucky that our clients think of us in that way too. Are you talent or are you vendors? And what about the people you work with?
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