Jun 10, 2013 10:51:28 AM | 8 Min Read

Mary Meeker’s Internet Trends Report Dissected

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Mary Meeker’s Internet Trends Report Dissected

This column was originally posted on Mobile Marketer Daily on June 10, 2013 and co-written by Ritesh Bhavnani, Casey Cavanagh and John D. Fauller.

Last week, Mary Meeker and the folks at Kleiner Perkins Caufield & Byers presented their annual “Internet Trends Report” at the All Things Digital conference. Much anticipated by techies, the report was chock full great insight and predictions into the ever-changing world of the Internet.

Not surprisingly, there was a lot of focus and emphasis on mobile and the impact of mobile on marketers. Like the rest of the digital world, we poured through the deck with great interest.

Here are some of the more interesting mobile-related data we found, along with our viewpoints:

1. Mobile traffic is growing fast and is greater than the stats indicate

According to Meeker, mobile traffic is growing at a rate of 1.5x per year and already accounts for 15% of all Internet traffic. That statistic is even more impressive when you consider the nature of mobile traffic versus desktop traffic. Typically, mobile web traffic is much “lighter” than desktop traffic due to bandwidth constraints (smaller pages, less video and images, etc.). So, even though mobile accounts for 15% of total bandwidth, it probably accounts for a lot more of total usage by any other dimension.

2. Globally, more people are accessing the web through mobile

China already has more people accessing the Web through mobile than desktop. Similarly, in South Korea, more people conducted more searches on mobile than desktop. Globally, the less developed the country, the more likely it is that most people are accessing the web through mobile, leapfrogging desktop PCs altogether. And it’s a foregone certainty that this will happen in the United States as well. Back in 2009, Mary Meeker had predicted that this would happen by 2014, and she’s probably not far off the mark.

Marketers today ignore mobile at their own peril. It may be trite, but it’s also true. But while “mobile first” is fast becoming a buzzword, crafting your media strategy by giving mobile precedence over other media perpetuates the very same siloed marketing that we see today. We prefer to think of it as “mobile always”, where mobile is an integral and co-equal part of the marketing mix, supporting other media while receiving support from the same.

3. Mobile is woefully under-penetrated as an advertising medium

When you look across all media, there is a huge disparity between the time spent on mobile (12%) and its share of total advertising dollars (3%). Those who have been around long enough may remember that the Internet had a similar disparity fifteen years ago, and like the Internet, its inevitable that advertising dollars will eventually catch up to eyeballs in mobile as well.

But like the Internet fifteen years ago, companies first have to create viable advertising solutions targeted specifically for mobile as a medium. You can’t just put a banner ad on a mobile site and expect it to work. Advertising strategies that show a real ROI for mobile are still being worked on and the gap in ad spending directly reflects that fact.

Facebook’s Sponsored Stories and Twitter’s Promoted Tweets are leading the way on their own platforms but there needs to be much more innovation before the dollars really start to flow. Those who see their glasses half full should view this as a huge potential opportunity.

4. Globally, feature phones still dominate smart phones…for now

There are 1.5 billion smart phone subscribers globally but over 5 billion feature phone subscribers.  But it is important to note that smartphone penetration varies widely by country. In countries like the US, Japan and Korea, smartphone penetration is already well past the tipping point and accounts for over 50% of mobile devices. Similarly, in a lot of developing countries (like India and Brazil), although smartphone penetration is low, the absolute population of smartphone owners is very substantial.

We believe that smartphone penetration will continue to grow rapidly as devices get cheaper and replacement cycles accelerate. Nonetheless, you can’t just forget about POPs (plain old phones) just yet. Marketers, especially in developing economies, need to have dual or device agnostic mobile marketing strategies.

5. Tablets have overtaken PCs 

In Q4 of 2012, global tablet sales surpassed those of notebooks and desktop PCs. iPad sales since launch have grown three times faster than iPhone sales did. And even within tablets, there is already considerable device profusion and screen size differentiation.

Tablets are here to stay, but most companies are still struggling just to optimize their websites for viewing across multiple devices. It is pretty ironic that Apple itself staunchly refuses to optimize its own website for its range of devices.

For brands looking to reach their consumers, they have to move well beyond thinking about screen sizes and device formats, focusing much more on the kinds of interaction modes and behaviors that consumers have with each of the different devices.

6. It’s an Apple/Android world

Smartphone OS share for Apple and Android together is greater than 80% and continues to increase at the expense of others (anyone remember the Nokia Symbian anymore?). If anything, that will continue to drive innovation and focus on mobile for marketers.

The consolidation of platforms makes it much easier for brands to make real investments in creating unique and exciting consumer-facing applications and marketing, as opposed to being forced to spread their dollars thinly across different platforms.

7. QR codes are not dead, just misused

There are nine million QR scans per month in China – four times more than there were the year before. 42% of those QR codes are being used by merchants for rewards and coupons, with another 33% using them for promotion and advertising purposes.

Stateside, we aren’t experiencing incredible adoption numbers with QR codes. Clearly it is not the technology itself, but the execution. It’s obvious there is a latent demand for a solution that bridges the physical and online worlds. And if not QR, then perhaps augmented reality, image recognition, location awareness, NFC or a combination of all of them will serve to bridge that gap. 

8. “Mobile” means much, much more than just phones (or tablets)

There are now fitness bands, smart watches, the seemingly-ubiquitously-talked-about-but-never-seen (and much mocked) Google Glasses and many other kinds of other wearable and drivable technologies, all of which fit under the moniker of “mobile”.

While the impact of these devices is yet to be felt in any significant manner, they present marketers with unique and manifold opportunities of getting even closer to their consumers in innovative ways. Exactly how they will fit into the mobile ecosystem is not entirely clear, but we are anxiously awaiting next year’s report to see how it all plays out.

Check out the complete ‘Internet Trends’ report here.

Topics: Mobile Stats, Mobile Marketing 101, snipp news, SnippWine

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