Smartphone Penetration and Usage Statistics

How many people have smartphones and what are they doing on them?

One of my 2012 mobile predictions was the (continued) rise of the smartphone. When a majority of people have such a powerful connected device, it changes everything for brand engagement.

I’ve created this handy chart to show where things stand across a range of countries. As there is no single data source, I’ve cobbled the information together from a variety of places. The EU5 and US are based on Comscore (Oct 2011), the others are from Google/IPSOS ( and Informa. Similar data can be found in the excellent Netsize 2011 guide.

One of the problems of using different data sources is that they are using slightly different measurements. For example, Comscore use a panel whereas the others will take data from network operators or the GSM Association. Take the UK, for example, where figures for smartphone penetration range from 46% to 53% depending on who you ask.

The chart below (using the same data sources) shows what people are doing on their devices, as a percentage of smartphone owners:

There are some key differences depending on the territory. For example (non-native)apps are much less popular in Poland, Czech Repbulic, and Turkey than the UK, Australia or the US. One key reason may simply be down to language. There are less apps in Turkish than English.

With a couple of exceptions, both mobile web and email represent the highest media use, not apps. Although some brands have begun to understand the importance of mobile optimised sites, many of them have focussed their efforts on apps. A significant oversight by brands is with email. Whilst it represents some of the greatest smartphone usage, few campaigns are optimising for it. Clearly a missed opportunity as the evidence is that where emails are optimised for mobile both read and click-through rates are significantly higher.

One interesting development is how usage has changed during the last 12 months. The chart on the right shows how apps and mobile web have grown in particular. Whilst SMS usage still remains high (the chart shows only SMS outside of peer-to-peer, such as brand marketing), it is flattening off.

Mobile Predictions for 2012

How will mobile and mobile marketing progress in the next twelve months?

The coming year will look something like this … a majority of people will have smartphones (older people will be an important demographic), shops will undergo dramatic change,  mobile ads will get richer and more interactive, and advertising will be more responsiveMobile voice control becomes a practical reality and new screens will appear with texture and gesture interaction. The tablet market will continue to rapidly expand, with users interacting (and buying) more than on mobile.  In the meantime, governments and brands will need to open up their data and provide APIs for the rest of us to make sense of it all.

Predicting the future is never easy. I have focused on the key trends from 2011 and considered how they are likely to impact on 2012 and beyond. Whilst most of the trends I predicted for 2011 were pretty accurate, there were a few notable exceptions (I have changed my mind about the future of tablets, and Samsung’s Bada hasn’t been exactly earth-shattering).

Everyone gets smarter (especially older people)

2011 was the year that the smartphone took off. Sure, smartphones aren’t exactly new, but in the UK (and elswhere) we reached 50% penetration. Even the developing mobile economies are showing a high rates of adoption and will soon seen a majority of people with smart handsets. The adoption of smartphones by a majority of people changes things everything for brands – as Mary Meeker pointed out in 2011, we have reached critical mass. All advertising a can be responsive. Consumers will ‘Tweet’ and ‘Like’ brands where ever they are. And they can compare prices or stock whilst they are standing in a shop.
One of the most interesting trends is the rapid rate of adoption amongst older adults. Typically early technology adoption has been focused on younger and often male demographics. That has been true of smartphones to date (although BlackBerry skews more towards women) and earlier this year, a UK study found that age, not income was the greatest barrier to smartphone adoption. However data from Nielsen in the US in November showed that the 50+ age group are some of the fastest adopters of smartphones. Although only 18% of the older age group owned a smartphone, they were buying them faster than almost anyone else.
In many ways this is not surprising. Fifteen years ago older adults weren’t using the internet. When they found they could get cheap flights, compare insurance prices or see pictures of their grandchildren, they got online. For example over 20% of UK aged 60+ are on Facebook. Why? They use it for photo sharing with their grandchildren. Similarly, ten years ago, SMS was considered a young persons’ medium but now every demographic sends texts – Comscore report that it is 90%+ across all ages. When technology is useful, old people will adopt it. What is useful about smartphones to an older adult? They can compare prices in shops or provide alerts for things like medication. It’s still early days, but expect the 50+ age group to be an important demographic in the world of mobile marketing.

Shops won’t be shops

2011 saw retailers getting into mobile, largely through the mobile web. Many of them quickly found that over 10% of their sales (Amazon, M&S and Halfords to name just three) were coming from mobile devices.
A consequence of the growing smartphone adoption is the role of shops. A Google IPSOS study this year found that over 70% of people use their smartphones in shops to compare prices. 22% of smartphone owners changed their purchasing decision in the shop as a result of using the device. That changes the game for retailers; shops will become more like showrooms. But it works the other way round as well. Shops no longer need a retail location. The much touted Tesco Homeplus in Korea is a fine example of that. Others have followed though. Net A Porter created pop-up shops in London and New York using image recongition and augmented reality (IR/AR). In Brighton, John Lewis took the Homeplus model to a Waitrsoe store, and the likes of Debenhams and eBay followed Net A Porter’s example. 2012 will be the year when the very idea of a shop is challenged by smartphones.

Mobile advertising gets rich

The disparity between the time people are spending in mobile media and money spent on advertising in it, has been highlighted a number of times in 2011. A study at the end of 2011 found that more ‘media time’ is spent in mobile than in print. However ad spend is less than 1% of the total in mobile, yet 27% in print. There is an argument to say that brands don’t invest in mobile because it simply doesn’t offer the returns. There is a parallel though. When the internet first got big there was no successful advertising model. Then along came Google’s model and they made it big. Arguably the same thing needs to happen in mobile.

Although the mobile ad networks are happy to talk up the channel, so far it hasn’t proved to be massively successful. Click-throughs on display advertising in mobile are currently lower than desktop and the future of  Apple’s iAd doesn’t look great, (and their share is falling). However, what Apple did was to show how mobile advertising can be rich, interactive and integrated to the content. If you want to win eyeballs in mobile then you need to be both interesting and unobtrusive at the same time. The best way to deliver that experience is using HTML5. Not only can it deliver rich media but it can also access handset functions like the GPS or accelerometer. It means that adverts can become more like mini-apps, minus the downloading part. 2011 saw a number of rich HTML5 ads from the likes of Tuborg, Autotrader and many more. Google announced that its HTML5 ad support and will shortly be bringing out a (free) creation tool.

The other boost to mobile ads will come from Facebook. Unlike some of their other initiatives, the social network are being cautious and rolling it out slowly. It seems as though mobile advertising is too important for them to get it wrong. Will Facebook ads be rich media? We don’t know at this stage, but such a major ad initiative from them will move the channel forward.

Ads and Everything Become Responsive

When a majority of people have a smartphone in their pocket, they can respond immediately to advertising and brands can use channels such as web or apps to continue the customer journey. There are many ways to get a response. SMS has been an obvious choice for over a decade, but for the last few years advertisers have been keen to use QR codes. There have been many issues with them, not least, the lack of consumer understanding, but it would appear that both brands and consumers are beginning to get QR. For advertising it’s about finding the right context and call to action. For consumers they offer an obvious advantage over SMS. You can respond to an ad without giving out your mobile number and risking endless text messages. In the last year or so, campaigns from Heinz and Kellogg’s have shown that when presented in the right way, QR works.

However a more interesting trend has been image recognition combined with augmented reality (IR/AR). A few apps appeared in 2011, such as Blippar and Aurasma, which allows users to scan an image onto which are over laid more information. Campaigns from the like Marmite and Heinz (not to mention Net A Porter, eBay and Debanhams) showed where IR/AR could go. One interesting thing about the technology is that unlike QR, it is backwards compatible. Any Marmite label would work with the Blippar app, for example. It also lends itself to some more guerilla campaigns. Fiat in Spain used the technology to promote their EVO by making road signs responsive – clever.

The other response mechanism that may be big in 2012 is NFC or Contactless. Although many are touting it as a form of payment, the potential of contactless as a brand communication should not be underestimated. We are seeing NFC appear in many handsets from BlackBerry to Google’s Nexus and there are strong rumours it will be in the iPhone. We are already seeing NFC enable bus stops and posters. In the UK for example, adverts for the 2011 X Men film allowed contactless users to ‘touch in’ for more information. It goes beyond advertising though. NFC chips are so cheap they can be embedded in almost anything. If your washing machine breaks down, you could simply ‘touch-in’ and you will be connected to your nearest mechanic.

Data goes open

This prediction is probably a case of wishful thinking rather than a real trend. Governments opening up their data is not so new and in the last few years people have done some clever things with that open data. However, the potential on mobile has barely been explored. Take London, for example. There are some useful apps around the cycle hire scheme and information relating to the tubes and transportation. But there is so much more that could be done. In early 2012 the Ordnance Survey will provide HTML5 and iOS APIs to their maps. That could create some really fun, interesting applications.

However, where governments are leading, brands should be following. Why shouldn’t every brand create an API to their non-sensitive data? The supermarket, Tesco, already have one for products and barcodes. That’s a start, but it could go so much further. If everyone had an API then developers will create great apps that brands never even thought of.

New Interactions: voice and screens

Last year I wrote about this as a prediction for some way in the future, but it looks like we are already moving beyond the touch screen. First off we have voice interaction. Although Google had voice control, Apple upped the ante with Siri, a more intelligent version. Not to be outdone, Google are looking to create an even more powerful voice interaction tool.

On the new screen front, things are also moving quickly. Although an both Sharp and an Indian company announced the development of 3D mobile screens, there is little demand for them. A more interesting development is that of gesture control. What we have in our Xbox today, will be in our phones tomorrow. In 2011 an Israeli company announced that they were developing technology which would allow mobile handsets to be controlled by gestures, not just touch.

Another technology that has been worked on since the 1950s is ‘electrovibration’, or the ability to change the screen’s texture (or at least the feeling of texture). Nokia have been working on the idea for some time, and a company called Senseg announced that they would be bringing out a texture sensitive screen in 2012. What’s the point? There’s a lot you can do with a texture variation screen. You can create friction, making it harder to pull your finger across different parts of the screen. That’s great for gaming, but it is also useful for maps or other applications where you cannot easily look at the screen, such as driving. From a brand perspective, as mobile advertising becomes richer and more interactive, the new screens will open up a new world of possibilities.

Tablets take off

In spite of my previous pessimism about the potential of the tablet market, the last year has shown how significant it could become. There was a 440% growth in tablet sales from the end of 2010 until November 2011 according to Google. That’s a faster rate of sales then the iPod or iPhone. Some countries we have already seen tablet sales outstripping PC sales. It has largely been driven by the iPad, but other devices are beginning to get a look in. Early reports of the Kindle Fire show strong sales, although much like the iPod, Apple’s tablet will still expected to dominate the market.

But it isn’t just the adoption of the devices, it’s what people are doing with them. The fast, interactive experience of the tablet means that it over indexes on the usage of web browsing and apps etc. Google tell us that 91% of usage is for personal use. These are fun items, not work tools, used to browse, view and shop! A study from the Macquarie Group found that 77% of the total ‘mobile’ data traffic volumes comes from tablet devices.

Similarly when it comes to advertising, engagement in through tablets is considerably greater than smartphones. Take paid search, for example. Macquarie Group found that whilst mobile CPCs were 108% that of desktop, tablets were only 85% of the cost, yet offered a higher click through rate. Google highlighted that even more than smartphones, users want interactive, rich ad content. Whilst magazine subscriptions have struggled on the iPad, but that is as much about the revenue model – consumers don’t value it as much as print. However, when you look at Flipboard, it’s clear that there is a strong market for iPad-based reading. It’s just a case of finding the right format. The iPad is also an important two-screen device. It’s the thing you use when you’re watching TV.

Where does this leave mobile in 2012? There are two things to keep in mind:

Firstly, with more smartphones in everyone’s hands, mobile can be the connective tissue between all brand channels: traditional, digital or social.

Secondly, when it comes to brand engagement, most consumers will reach for their mobile before anything else. Brands now need to think in terms of ‘mobile first’.

M&S turn a social media faux-pas into a gain!

I often say that M&S do mobile well. They also have a great social media strategy. Here’s an example of why they do it well.

Last week one of their Facebook administrators forgot to logout of the M&S account and updated her personal status on the corporate one by mistake. The status update was that she had now found her missing phone. Oops! Not the worst thing to put on a status update, but still, it isn’t really the done thing for a corporate account. Although M&S deleted the update, rather than ignoring it, they asked for other stories of lost and recovered items instead. They quickly got over 40 comments with tales of tragedy and joy, and 150 likes. Not a massive gain,  it shows how having a human face is important in brand social media.

Is Open Data the Future for Brands?

It may sound very dull but open could represent the future for brand engagement. There’s plenty of talk about the UK Government’s Open Data initiative. Just a couple of years in and there are already some interesting projects. Take London’s Cycle Hire Scheme, Boris Bikes. Within days of the announcement there were iPhone apps-a plenty telling you where the nearest bike parks were, how many were there and so on. That was all thanks to open data. Boris and his chums didn’t need to build a complex app, all they had to do was get the information out there and someone would do something interesting with it.

One exciting development is the open data initiative from Ordnance Survey. Last year they opened up an API to their maps, but it was only Javascript. However, they have announced that they will be releasing an iOS and HTML5 API in January 2012. That means that any developer can take the maps and do something interesting. ‘But we already have maps on smartphones’ I hear you say? Yes we have some good road maps, but OS is very different. It gives footpaths, field boundaries and every building is shown regardless of whether it’s in the city or countryside. That’s far more detail than anyone else. And think of what could be done with all that fantastic map data? Hiking or off road cycling apps are an obvious example. But in the end, you don’t really know what you’re going to get. That’s the fun part of open data. Someone somewhere will probably come up with something interesting.

So on to brands. Rather than spending lots of time and energy developing apps or mobile sites, why don’t they just open up their data and let other people use it in interesting ways? If consumers like it they’ll use it, if they don’t they won’t. Tesco’s already did this to some extent a few years ago, by creating an API into their online shopping, Besides online stock and ordering they also have included their barcodes as part of the interface. They have around 1000 developers registered. And the great thing for Tesco’s is that their .com service can be used by any developer. It’s like a (free) affiliate scheme only much better.

Many online and social media brands know the value of open data. Google has a number of APIs, but the new kids on the block like Foursquare or Instagram have them from the word go. You only have to go to their sites to see how many great applications independent developers have created with this. Take Instagram. Someone I know has just produced a great little app called Instabam. It uses your location and shows photos from near where you are. Great, simple and fun.

So why doesn’t every supermarket do the same as Tescos? And whilst they are at it, they could do even more. Besides prices, stock and barcodes, why not include delivery logistics or store layouts? Someone will develop an app that shows you where your delivery van is, or takes you around the store via the fastest route based on your shopping list. It’s not just retail though, every brand should be doing it. How about banks? OK, they’re not going to open up APIs to our personal accounts, but what about all the other data they publish? Interest rates, insurance offers. Even the salaries of their directors – if they really think they are acceptable, then they should make them open data and let someone make an app with it.

How will people use all this data? Well, we don’t know. That’s the great thing about open data. Of course brands will worry about people ‘mis-using’ their information. However it’s no different than how a brand should approach social media. It’s like saying ‘we shouldn’t have a Twitter presence in case people say something bad about us’ (of course some brands actually do say that). In reality people will think and say bad things about your brand wherever they are, so it’s better to know and address it, surely? The same can be said about open data. It can bring out all kinds of things you would prefer people not to know. One teenager used the government’s data about department energy use to produce a chart showing the best and worst ministries. Some departments looked very bad, but it allowed those poor performing ones to look at the problem and address it. In the end brands need to realise that just like your Facebook Wall, open data is about democracy – let people use it, don’t try to control it.

In fact, if brands opened up all their data, then they need not worry about developing apps or mobile sites any more. Brands should think about it this way – if you open up your data then some bloke in Shoreditch wearing skinny jeans will come up with an application that you never thought of. And it will be great and it won’t cost you a penny. The only problem for me is that as a mobile strategist, brands will no longer need me and I’ll be out of a job!

Fiat Spain: nice augmented reality/image recognition campaign

In case you missed this (which I did), Fiat did an interesting image recognition campaign using street signs to promote their Evo. Users downloaded their iPhone app, and when they held it in front of various different street signs it showed further content. Hold it in front of a stop sign, there was a video and information about the breaking system. Hold it in a curve sign and it tells you how the intelligent headlights move around a bend.  At the end of the information users were encouraged to book a test drive and the whole thing was incentivised with prizes.


How did it fare? Over 1 million people scanned the signs and most important of all, test drives went up by 82%. All that and on a tiny budget.

There’s more on the campaign here.