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 12 TRENDS FOR 2012 December 2011

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12 TRENDS FOR 2012December 2011

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12 TRENDS FOR 2012

• We have been producing trends for clients for the past few years

• Nothing changes on New Year‟s Day; all of these trends are already happening, but

will grow significantly over the next 12 months, having a greater impact than in theprevious twelve

We highlight what we think will happen next year, with implications for brands, rootedin what we have observed this year

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12 TRENDS FOR 2012

1. Mobile Commerce

2. Mobile Payments

3. Mobile + TV 

4. Connected TV 

5. Mobile in China, India & Africa6. Mobile's Threat to Other Services

7. Ecosystems & Walled Gardens

8. Real Time Bidding & Automation

9. Education Enabled

10.Hijacks & Guerrilla Marketing11.'eBay' for Services

12.Simplicity

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1 - MOBILE COMMERCE

•  As more people have more advanced phones they are more willing to usethem to buy things, rather than wait to use a computer

• Smartphones outsold PCs in the final quarter of 2010, and quarterlyshipments have seen double-digit year on year growth since that

• Current levels of smartphone penetration are above 33% for the big in inEurope & the US, and above 50% for several demographic groups in eachmarket

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 • Lots of data shows that people are shopping via their mobile more andmore:

• 10% of visits to eCommerce sites in the UK come from smartphones1

• In the US two thirds of smartphone owners used their phones to engage in

shopping activity (inc price comparison and product search) in Sept 20112

• In Australia, a quarter of Christmas shopping-related searches in 2011come from mobile devices3

• Local transactions through Kenya‟s mobile money service M-Pesa nowexceed Western Union‟s global transactions4

• Sources: 1 – IAB UK, 2 – comScore, 3 – Google, 4 - IMF

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 • In response, more companies are unveiling mobile sites and apps

• Many high street retailers, and online merchants now offer both mobileoptimised sites and apps

•  Asos launched a mobile app after seeing 800% growth in sales from itsmobile site

• More and more brands are using QR codes to direct people from press andoutdoor ads or even virtual pop-up stores to mobile sites and apps, to makethe process easier

• Charities are using mobile more, for example Toys „R‟ Us lets you donate a

gift from a window display via QR codes• Easyjet has just introduced a Speedy Booking app, to take advantage of the

new willingness to book through mobile

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IMPLICATIONS FOR BRANDS

• Brands need to ensure that their operations are optimised for people usingmobile throughout the purchase process

• This includes mobile search (organic and paid), mobile apps (not just for theiPhone, but also Android, Windows and tablets), and ensuring that sites

work well with mobile•  Any links for mobile should point to a mobile site, and any links online

should recognise when a visitor is using a mobile device and automaticallyredirect for the best experience

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MOBILE PAYMENTS

• Mobiles have joined keys and wallets as items that people always carry withthem – and are now starting to be used as wallets

• Mobiles have been used for small in-store payments in Asia since the early2000s, and this is spreading around the world

• New technologies like Square and Google Wallet have emerged, and existingtechnologies like Paypal are adapting to allow payments

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 • Square started trading in 2010, allowing merchants to use a smartphoneadd-on to process credit card payments

• It is now processing over $8m per day, has over a million merchants, andsays that 70% of its merchants did not previously accept card payments

• Near Field Communications (NFC) is a technology that allows mobileowners to „tap in‟ to make a payment, similar to using a transit system card

or door entry system

• Google Wallet, launched in May 2011, uses NFC to allow people to pay forgoods in the US

• There are currently over 250,000 terminals to accept payment through NFCin the US

• Paypal is also embracing NFC, and even lets people make payments to eachother by „tapping‟ their phones 

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 • In 2012 we expect both Square and Google Wallet to expand outside the US

• Richard Branson is now an investor in Square, and has also given VirginMoney a physical presence in the UK with the purchase of Northern Rock 

• Financial institutions like NFC as a means of payment because people aremuch more attached to their phones than their credit cards, and so noticemore quickly when they are missing

• The number of NFC phones is rising fast, with Samsung, Nokia, Blackberry,HTC, Motorola and LG all now selling devices

• There may be issues around different standards (Google Wallet only works

for users of one mobile network, for example) but mobile payments willbecome more widespread

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IMPLICATIONS FOR BRANDS

• Brands need to be aware of the new retail environment

• Mobile payment is quicker and in many cases more convenient

• Can you make special low-price editions to sit near tills for impulse buy?

Can you equip store staff with readers, to make purchase easier?• Can you have wandering sales staff at events, taking payment?

• If NFC becomes popular, could you use it for anything else, for examplegiving more information in store, or allowing access to events?

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MOBILE + TV 

• People are increasingly using other media while they watch TV 

• The internet, and especially the mobile internet, is now providing a commentary track to popular TV shows

• Over 50% of X Factor viewers in the UK used Facebook while they were watching1

• 80% of American mobile internet users use the internet while they are watching TV;36% say they look up information relating to ads that they see2

•  A contestant on Dragon‟s Den in the UK received over a million visits to her site while

the programme she appeared on was on air

•  An average episode of the X Factor in the US receives 94,000 comments in socialmedia3

• Sources: 1 – Carat, 2 – Razorfish & Yahoo, 3 – Bluefin

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 •  A mobile app Get Glue lets people „checkin‟ to show what TV programmes they are

watching

• Since mid-2010 it has grown to over 15m users, and some shows in the US get over50,000 checkins while they are on

Programmers are taking notice of the data. In November it was announced that thethree „new for Fall‟ shows in the US with the highest number of GetGlue checkins

were all recommissioned

•  Another app, Zeebox, lets you see what programmes your friends are watching anddiscussing, or what programmes are being discussed most

• This data could change viewing habits or be another tool to assess the popularity of

programming• Finally, it‟s probably that 2012 will see the first events that mass audiences will watch

through mobile – for example The Olympics

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IMPLICATIONS FOR BRANDS

• Be aware that people watching your ads or your sponsorships on TV may be activelyusing the internet

• Make it easy for them to find more information – buy keywords relating to advertisingcontent so that when people search they will find your official pages

Use social media around what the brand is doing on TV – engage in conversations,and make sure that there are people online to field queries or amplify goodcomments made in social media

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MOBILE IN CHINA, INDIA & AFRICA 

•  As transformative as mobile will be in the West, that‟s nothing to the impact it will

have in other parts of the world, notably China, India & Africa

• In countries where many people cannot afford a PC, the mobile becomes the mainpoint of internet access

For example in the UK & US approximately 25% of mobile internet users rarely ornever use a desktop – but it‟s over 50% in Africa, and nearly 60% in India1

• Meanwhile smartphone shipments in China are now higher than those for the US2 – and there are more than 110m 3G subscriptions3

• Mobile is likely to play a crucial role in its digital future 

• Sources: 1 – On Device Research, 2 – Strategy Analytics, 3 – Marbridge Consulting

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 • China is likely to become far more mobile as time goes on, as over ¾ of all phonesubscriptions are mobile1

• These users are now upgrading to smartphones; In 2011 over 340 differentsmartphone models were sold in China, 80% running Android2

& it‟s not just for entertainment – over 50% of mobile web users use mobile banking3

• Smartphones are much less popular in India, but sport helps us see how popular themobile web is. During the 2011 Cricket World Cup Final, 45% of the visits to themost popular cricket site came from mobile4

• Mobile payments are also important in India – Nokia‟s Mobile Money is being rolled

out by the Union Bank of India

Similarly, in Kenya 99% of all internet access is through mobile, but it‟s not allsmartphones – a lot still comes through GPRS

• Mobile is many people‟s experience of the internet in these areas

• Sources: 1, 2 & 3 – Marbridge Consulting, 4 – ContentSutra, 5 – Communication Commission of Kenya

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IMPLICATIONS FOR BRANDS

• Put mobile at the forefront of your strategies in these areas

• Make sure that the mobile technology that you use is appropriate for the local users

• Include mobile payment – many people do not have bank accounts, but can paythrough mobile systems like M-Pesa and Nokia Mobile Money

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MOBILE’S THREAT TO OTHER 

SERVICES

• There are signs that some of the first generation services and products are underthreat as people move to more sophisticated, or cheaper services

• Handheld gaming devices like the Nintendo DS are losing share to the convenienceof mobile handsets with games like Angry Birds

Microsoft‟s Internet Explorer now has less than 50% of all browsers for the first timesince its launch, partly as a result of the rise of mobile browsing

• iPods sales are falling – in the most recent quarter Apple sold more iPads & iPhonesthan iPods

• Digital camera sales are falling. As the cameras on smartphones get better, peopleare buying fewer separate cameras

SMS may also soon be under threat – many young people are now moving to cheaperservices like the free messaging of Blackberry Messenger (BBM) or apps likeWhatsApp that allow free messaging across different smartphone platforms

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IMPLICATIONS FOR BRANDS

• This should serve as a wake up call that the world moves on, and things that seemunassailable one year may be struggling the next

• It‟s also an indication of how much mobile, and specifically smartphones are taking

over, and changing how people use pre-smartphone devices

Brands need to look at their products & services and examine how many are underthreat from mobile

• Unless you offer a brilliant mobile experience you could be under threat a competitorwho is

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CONNECTED TV 

• TVs are fast becoming connected devices, able to connect to the internet, selectprogramming, run apps, and show interactive advertising

• Many TVs on sale now are designed to be connected to the internet through ethernetinput and wifi

In addition new set-top boxes like GoogleTV and Boxee, and games consoles likeXbox also allow internet access through the TV 

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 •  An estimated 50m internet-enabled TVs will be sold by manufacturers like Philips,Sony, Samsung and LG in 2011

•  Apple is also thought to be working on a TV 

• Like smartphones, internet-connected TVs have operating systems, capable of

running apps and programmes• The hardware manufacturers have app stores allowing you to download apps from

media owners, games, and even social media apps like Facebook and Twitter to runon TVs

• Social media apps will allow people to comment on what they are viewing within theTV interface, and see what others are saying

This will mean that the „Mobile + TV‟ activity mentioned earlier will also be takingplace within the TV 

• There is also the danger that this will create new, restrictive ecosystems –  see the

next trend 

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IMPLICATIONS FOR BRANDS

• Think about how your brand would fit into TV through apps & extra content

• This includes games and entertainment, and also making sure that you are visible insocial media & search when your brand is likely to be on TV 

• New opportunities within these environments include ads within the electronic

programme guide (EPG), and pre-rolls in videos

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ECOSYSTEMS AND WALLEDGARDENS

•  A few years ago people predicted the end of walled gardens – sites like AOL whereyou were encouraged to stay within the safe confines of the site for all your content,rather than to venture into the world wide web

• The idea of the walled garden has practically gone, but it‟s being replaced by the

idea of the ecosystem, both on the web and particularly in mobile

• For example, changes at Facebook brought about by the frictionless sharing of appslike Spotify and news sites, mean that you can see news and music consumed by yourfriends from within the network; it wants you to stay within Facebook rather thanleave to go elsewhere

• Similarly, companies like Apple and Amazon have devices that give you access to aprescribed set of retail outlets for content – other content is either discouraged or

impossible to use

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 • Facebook has added features over the past few years to encompass the mainactivities that people do online, from email, to news, to videos, to online shopping

• Facebook doesn‟t lock you into the site, but through its platform on other sites (for

example the Like button), or comments, it is never far from members wherever theyare online

• Facebook estimates that every month 500m people use an external app on Facebook or experience the Facebook app on other sites

• One example of this is an integration with Ticketmaster that lets people see whichother friends have booked the same event – and then pick seats near to them

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 • With mobile a handset is no longer just a handset. It needs an ecosystem of contentand applications

• Phones and other devices are not just sold on their capabilities, but on what they willbe able to do in the future

 Apple is in a powerful position because devices have access to a huge number ofapps and games, in addition to lots of music and other content through iTunes

• This is the strategy that Amazon is hoping to emulate through it‟s new Kindle Fire

tablet. It gives (paid) access to the digital content available from Amazon, and usesGoogle‟s Android operating system 

•  All of this will make it increasingly hard to consumers to choose which device to buy;it‟s not just about the device, but the content you can put on it  

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IMPLICATIONS FOR BRANDS

• Be aware of the different ecosystems, and make sure that you are accessible bythem, but not exclusively

• For example, produce apps for all of the main platforms, but also be aware whichyour users are most likely to have access to

Similarly use the „Like‟ buttons, but not the exclusion of other social buttons (like„Tweet This‟ or +1) 

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REAL TIME BIDDING & AUTOMATION

• The buying and selling of advertising will become more automated

• In digital media supply outstrips demand, so traditional pricing models are notappropriate for many campaigns, bar the most sought-after content

• Data volunteered and collected from web users can be used to target advertising

 Audience behavioural targeting will become the norm, rather than contextualadvertising, or traditional demographic targeting

• Technology can automate the buying and selling process, with inventory beingaggregated in „exchanges‟ on the sell side, and buyers bidding for audiences into

those exchanges via „DSP – Demand Side Platform‟ technology on the buy side 

• Buyers plug into the exchanges to select what they want based on a number of

criteria like demographics, content type, location, and the history of other sitesvisited

•  Advertising through exchanges can be more effective; some studies show what thereis a higher ad visibility compared to standard network buys

• This now exists for display, video and mobile

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 •  At the same time more media is being traded through the Google and Facebook‟s

advertising platforms, based on selecting and bidding for inventory

• Twitter is also launching its own DIY platform to agencies to use to place ads on thesite

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IMPLICATIONS FOR BRANDS

• Test, and learn from new technologies!

• Identify which campaigns need to be bought manually, on premium sites, and whichcould benefit from the efficiencies of real time bidding

• Investigate the options offered by Facebook and Twitter as ways of targeting people

based on non-traditional metrics

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EDUCATION

• Education is vital, but is becoming more expensive due to cuts in public servicesacross the world

•  At the same time technology is emerging that would help students and educators

• The big changes in society brought about by digital media and the ease of

communication haven‟t yet hit education, but they will do soon 

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 • Google Hangouts let people have video conference calls of with up to 10 peoplewithin Google Plus

• Performers like Will.i.am use them to talk to fans; but other musicians use them togive lessons

Hangouts could be a very useful tool for holding virtual seminars on subjects

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IMPLICATIONS FOR BRANDS

• There have been lots of initiatives where brands have got involved with schools inareas of sport, nutrition and more, but why not help enable a new era in education?

• We may be entering a new, more DIY age, and there could be a place for brands tohelp enable communication and resources, for example sponsor physics or mathshangouts?

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HIJACKS AND GUERRILLA MARKETING

• Digital media, and particularly social media have helped information to spread morequickly

• Brands need to be able to act and respond to events quickly, and this will lead tomore hijacks and guerrilla marketing

Brands can act quickly and do things in the short term, often at the expense ofcompetitors

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 • Two recent examples:

• Samsung hijacked the launch of the iPhone 4S in Sydney by opening a store a fewdoors away selling the new Galaxy S for $2

• Only 10 were sold at this price each day, but this ensured a queue for Samsungnear to the Apple store

• Samsung also hijacked the „iPhone‟ with their most recent ad, mocking Apple fans

in their queue

• “I can‟t have a Samsung – I‟m creative” 

• “Dude – you‟re a barista‟ 

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IMPLICATIONS FOR BRANDS

• Brands need to be in a position to act on events whether they are done bycompetitors or happen in the wider consciousness

• 2012 has lots of big events including the Olympics, Euro2012, and the US Election

•  All are perfect for opportunist marketing, and produce incidents that are likely to be

seen by millions very quickly, and could be used for unofficial and irreverentmarketing

• Beyond this, what are your competitors‟ marketing calendars? 

•  Also, be aware that what you are doing may get hijacked – how can you protectyourself?

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‘EBAY’ FOR SERVICES 

• More and more people are turning to the internet to find people as well as things

•  As a result the eBay auction model is being adapted and localised to allow people tofind the services that they want

• It‟s also helping employment become more flexible 

• In the UK the number of people making a living from online selling has doubled inthe past year1; soon more people around the world are likely to be selling theirservices online as well as goods

• Source: 1 – Collect+

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 • The three most interesting companies are Fiverr, Zaarly and Roamler

• Fiverr allows people to sell their services – what they would do for $5 – ranging fromdesign and art to writing, to tourist advice

• Zaarly lets you find local people willing to help you out, for example decorators,

removals people, and so on, by posting briefs and then letting people bid on the work • Roamler is a Dutch service that lets people sign up (with their location) to say that

they‟re available for work. Prospective employers issue requests for staff; anyone

local can apply

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 •  All three services provide flexible ways of working for both employers and employees

• Zaarly claims to have over 100,000 users across the US and has raised over $15m infunding

• Examples of tasks bought include:

 A critique of DJing skills• Translation

•  A private yoga lesson

• Rescuing lost keys from a drain

• Services like this seem like the natural extension of local marketplaces

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IMPLICATIONS FOR BRANDS

• Get involved!

• Think about what you could buy, and what you could sell

• Major brands are now very active users of eBay to sell goods, especially excess supply

• Could you use any of these services to sell excess capacity, or even recruit short term

staff?

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SIMPLICITY 

• People now navigate the web using a wide range of devices, operating systems andbrowsers

• It‟s increasingly important for sites and applications to work as simply as possible,

and be usable on a range of screen sizes

• Sites don‟t need to be too polished, if that is at the expense of speed and usability

Users want sites to look professional, but often they don‟t need too many features,

they just need to features to work on multiple platforms

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 • Similarly, don‟t over-complicate what users need to do to respond

• Pepsi ran a competition with the X Factor in the US that just required users to emaila photo from their phone – a capability that is built into every smartphone

• There was no app to download, nothing to scan

Converse ran a location-based treasure hunt competition in the UK that simplyshowed pictures of the Converse logo on objects like phone boxes. Locals were ableto identify the places and find the shoes. No checkin was needed

• & some restaurants now run their sites as blogs – the only content is a daily upload ofa photo of the menu

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IMPLICATIONS FOR BRANDS

•  Are your sites and online presences as simple and straightforward as they could be?

•  Are they accessible from all devices, in all operating systems?

•  Are any campaign metrics easy enough to encourage widespread participation?