Biggest trends in mobile marketing, from Apple engineer Francis Shepherd at TIMA

by Karl Sakas on May 12, 2010

Photo of Apple engineer Francis Shepherd presenting on mobile marketing to TIMA in Durham, NC

Get started now, because mobile marketing is growing fast, according to Apple systems engineer Francis Shepherd…and he brought hundreds of articles and infographics to prove it. He gave a fast-moving talk to a full house at today’s TIMA event in Durham, NC.

My Top 5 Lessons from the Mobile Marketing Talk

  1. 40% of new phones are [web-enabled] smartphones, and on average, people buy a new phone every 18 months. There’s room for growth, but it’s still also a minority of total phones.
  2. Selling 1 million units took two years for the iPod, 90 days for the iPhone, and 28 days for the iPad.
  3. With “immersion,” mobile ads will appear seamlessly, without today’s “click a link” disconnect.
  4. Apple now considers the environmental footprint for the entire lifecycle of its products.
  5. Want an in-demand job? Become a mobile app programmer.

Francis gave a “these are my opinions, not Apple’s” disclaimer. As you might expect, the presentation was nonetheless pretty Apple-centric. @1918 had some a great #tima live tweets from the event, including a good insight about room for smartphone potential:

Screenshot of tweet by Phil Buckley (aka 1918)

And Now, for the Details…All the Details

Here’s a recap of Francis Shepherd’s “Tune Out the Static in Your Mobile Marketing Buzz” presentation to the Triangle Interactive Marketing Association on May 12, 2010.

This doesn’t have the full impact of his live presentation, but for that, you’ll have to show up in person:

  1. Key trends/buzzwords: ubiquity (content everywhere), convergence (all media in one spot), data storage (tons of data transmitted, and it needs to be stored somewhere), ecosystems (the community and environment surrounding your company and your marketing campaigns), augmentation (information on demand, and “augmented reality” heads-up displays), and immersion (mobile ads will appear seamlessly, without today’s click-through-to-a-website disconnect).
  2. Data storage is the next frontier–there’s all this data; where will it live. We’ve already gone from megabytes to gigabytes to terabytes, but it’s now even bigger. AT&T announced they’d transmitted an exabyte of data, which is next up from petabyte after terabyte. AT&T’s network now carries more data traffic than voice traffic.
  3. Today’s “digital divide” is about bandwidth as a limiting factor. Akamai reports the NC Research Triangle is in a recent Top 10 list for available bandwidth. But we can’t assume all our users or marketing targets have the same level of connectivity.
  4. Smartphones “put the internet in your pocket”–it’s always with you
  5. Five years ago, Apple changed its name from Apple Computer to Apple Inc, as it acknowledged moving from being a computer company to being a technology company. And two quarters ago, Apple announced “we’re all about mobility” (and all of its products are now designed with mobility in mind).
  6. Apple intentionally avoided the netbook market (the $500 and now the $300 price point). This has worked for them, since the iPad cannibalized the netbook market while PC manufacturers duke it out in a race to the bottom on netbook pricing.
  7. Unlike many tech competitors, Apple (along with Google) is debt-free, according to an April 2010 Silicon Alley Insider chart-of-the-day. Of course, that potentially limits the amount of cash Apple has available to make acquisitions.
  8. As a former analyst at a crunchy-granola mutual fund company, I’m pleased to hear Apple is now considering its environmental footprint for its entire product lifecycle. They include manufacturing, product takeback, and even emissions for recharging their products. This is a huge improvement over Apple’s notably subpar messaging about CSR when I last covered them in 2008.
  9. Some usage stats about the iPhone: 98% use it for web browsing. 94% use it for email (so no, email’s not dead). 80% use 10+ iPhone features on a regular basis.
  10. There are 185,000 apps in the iPhone App Store, which has had 4 billion downloads to date.
  11. There’s a lot of upcoming growth in smartphones. 40% of new phone sales are smartphones, and people tend to replace their phone every 18 months, so the installed base of smartphones will continue growing as a percentage of all cell phones (I don’t think Francis mentioned a statistic, but I’ve seen it as a 16% smartphone market penetration elsewhere).
  12. The time it takes Apple to sell 1 million units keeps getting faster and faster. It took two years for the iPod, 90 days for the iPhone, and just 28 days for the iPad.
  13. Francis had a great side-by-side slide, showing iPad uptake by senior citizens and 2.5-year olds.
  14. There’s now iPad-compatible clothing, and a “Spot the Hidden iPad” tutorial.
  15. We need to design websites for smaller screens. Before releasing the iPad, Apple worked with CNN, Reuters, and other major sites to ensure pages would render well on the device.
  16. Want an in-demand job? Boutique game-design firms are hiring mobile app designers. Francis mentioned how his son and daughter-in-law eventually quit their jobs to run Imangi Studios, a D.C.-based app development firm. Of course, creating a winning app can be hit or miss.
  17. Apple’s WWDC developer conference sold out in eight days this year (versus a month last year), as an indicator for interest in programming for Apple platforms.
  18. HTML 5 = HTML + CSS + JavaScript APIs. The media browser will become the media engine. See Mark Pilgrim’s “Dive into HTML 5″ for more information.
  19. Mobile advertising will become more immersive. Today, you click a link on your phone and the ad sends you to a website. In the future, consumers will see the ad content seamlessly.

Caveats and Limitations

Photo of Apple engineer Francis Shepherd presenting on mobile marketing to TIMA in Durham, NCFrancis did a great job of organizing everything–it all flowed together well–but I occasionally suffered from information overload. It’s a good sign when you’re struggling to keep up as you write down all the interesting statistics and trends.

Certainly, Apple is a marketing exception, not the rule–most companies don’t have their level of brand equity. But as key innovator in mobile, we should pay attention. Even if I haven’t bought an iPad yet.

I asked Francis afterwards about privacy trends. He said he’d brought a lot of slides on privacy but he’d run out of time. He noted that in an era where cameras already record everyone when we’re on the street, security may be the bigger challenge for mobile devices.

I wish we’d had more time to address the digital divide: clearly, smartphone penetration is growing, but what about the current majority that still doesn’t have mobile web on their phones? How can we reach them? I’ll see if next week’s Triangle AMA mobile marketing panel can address that.

Finally, I wish we’d had time for an audience Q&A but things ran over. As TIMA president Janet Kennedy noted before she left for Florida for the NASA Tweetup, “If you’re here with your boss, you can stay as long as they do.”

Conclusion

For the extensive list of references in the presentation slides, you can download a jaw-dropping text file of everything. There are 511 citations! Tucker Peterson will be uploading a cleaned-up file to the TIMA website.

When Francis showed photos of the lines outside Apple Stores on the iPad release day, he pointed out that everyone had lined up to buy without knowing much about what it would be like to actually use the product.

It occurred to me that Apple could sell empty boxes. In fact, The Onion already has an article about that: “Apple Claims New iPhone Only Visible to Most Loyal of Customers.”

Where do you see mobile marketing going?

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