Even with the penetration of smartphones rising to 50% of all US mobile users by the end of the year, mobile ecommerce remains a work in progress for many medium-size and small retailers. Online retailers who did not yet invest in a mobile ecommerce retail solution, need to begin making investments in preparation for holidays 2011, where we will see the most dramatic mobile ecommerce consumer behavior changes. However, in their effort developing a mobile ecommerce many retailers are not considering the full range of available options, according to a new report from Forrester Research, called Mobile Commerce Solutions for Retail. Forrester analyst Peter Sheldon reviews the various options online retailers can choose from to get started with mobile ecommerce and lays out the pros and cons of each approach.
One route to developing a mobile ecommerce website, adopted by one-third of retailers, is to use one of the many mobile application development platforms that offer online tools for building customized mobile web sites and apps for iPhone and Android-powered smartphones. This strategy has pros and cons. It allows a retailer to launch a mobile commerce offering quickly, with minimal technical expertise, but due to the nature of the proprietary platform there is often no option to expand the functionality beyond what is offered through the platform, which limits an online retailers’ ability to differentiate and keep up with innovation in the fast-changing mobile landscape.
Another common path, which is taken by about one-quarter of online retailers, is to extend their existing ecommerce website to the mobile realm. There are at least three ways to accomplish this, including building a new custom mobile ecommerce web site and integrate this site with the current back-end technology and business processes. This is an approach often taken by large retailers with in-house resources and IT staff or those online retailers that can afford to hire an external website development company specializing in building mobile web sites and apps. The downside to the latter approach is that upfront development and ongoing maintenance costs will be required. Source
Despite the sluggish US economy research firms specializing in media and advertising have only recently begun downgrading global ad spending forecasts with minuscule amounts. Domestic online ad spending forecasts have been very positive so far with eMarketer projecting a 20.2% gain for 2011. But with the recent bad economic news piling up and the fear that the US is heading for a double dip recession will these forecasts hold?
ZenithOptimedia, the research arm of Publicis Groupe, last month dialed back its spending growth forecast from 14.4% to 14.2 %; still a respectable growth number. WPP’s GroupM still expects online ad spending to grow between 15% to 16% a year through 2012. These projections obviously do not reflect any negative impact, if any, from last weeks stock market plunge and the US credit rating downgrade by S&P.
MagnaGlobal, a strategic media research firm maintains that even with this latest economic scare the rate of innovation around the Internet will remain strong and as a result online advertising spend still looks pretty secure. The company expects that online advertising revenue will continue to rise from 17.3 percent ($30.1 billion) of total ad revenues to 22.4% ($47.4bn) in the next five years.
However, if we have learned one thing from the financial collapse of 2008 and the following recession, it is that even online advertising is not immune to a major downturn in the larger economy. We have to wait and see how this plays out in the comings weeks and months. Source
CampusBuddy, an online service where college students can access official grade records and reviews about colleges, is launching a new service called CollegeBudget, which aims to bring daily deals and group buying, including food, clothing, textbooks and student loans – and one day in the future, potentially tuition, to campuses across the country. At the public launch over 100 merchants are expected to participate and deals will be in the 50% off range.
CollegeBudget, which is only for college students and requires a “.edu” email address to sign up, has already 600,000 college student members since it launched its private beta in March of this year, claims to have saved college students over $1 million collectively.
CollegeBudget will, on average, be taking a 40% cut from deals it sells but will assist merchants in promoting their deals on the platform through social media marketing campaigns at no cost. Merchants signing up to offer student deals receive a YouTube testimonial video made by a college student, as well as social media blasts to CollegeBudget’s 130,000 plus Facebook fans and 3,000 Twitter followers. Source
Glue Mobile Has Acquired Two Game Development Companies
Mobile game developer Glu Mobile has acquired two game development companies to increase its game development capacity. Over the past year Glu Mobile has been active with developing free-to-play social games for iPhone and iPad and recently also Android-powered phones.
Griptonite Games, one of the acquired companies, employs about 200 people and is known for its console game and Nintendo DS development, but will now focus primarily on social games for mobile devices. Blammo Games, has already partnered with Glu in the past on social game development projects.
Both of the acquisitions where paid for in stock.
Free-To-Play Smartphone Games Are Outselling Packaged Software Games
Sales of traditional, packaged software games are getting killed by the play-for-free mobile game offerings. As a result video games revenues dropped by 10% in June of this year, according to market research firm NPD Group. One of the reasons for the decline is the hefty average $40 price traditional game publishers and developers are charging gamers for packaged software games. But the biggest impact is caused by gamers shifting from handheld devices, such as the Nintendo DS and 3DS, to iPhone, iPad and Android mobile devices.
Facebook Is Enhancing User Discovery Of Social Games
Facebook is planning on updating the algorithms that drive the discovery methods it is using to filter game stories so that they are shown only to users that actually are actually playing social games.
Beyond 2011 the product road map calls for the engineering team to look at new game platform features that may work for Facebook, like voice chat and text chat.
Livingsocial Claims Their Deals Are Working For Merchants
After Business Insider published the disappointing results of a survey it conducted among businesses that had run their daily deals promotions on Groupon, competitor LivingSocial reached out with the results of a survey it held among 369 businesses that had used LivingSocial for daily deals promotions. It found that the vast majority made a profit or at least broke even on their daily deals.
Daily Deal Clones Ripe For Acquisition
A study by M&A outfit 451 Group has revealed that daily deal clones are ripe for acquisition. So far this year there have been 36 acquisitions worldwide with Groupon as the most active acquirer; gobbling up 20% of the clones. 96% of the daily deal sites that were acquired were founded 2 years ago and 63% started out in 2010.
AmazonLocal Launches in Groupons’ Home-town Chicago With The LivingSocial Sales Force Selling Its Deals
Two months after a soft launch in Boise, Idaho, Amazon expanded its daily deal offering AmazonLocal to Chicago, the home town of daily deal giant Groupon. But wait, selling daily deal offerings to local merchants requires “boots on the ground” in the form of a large local sale force calling on small businesses and Amazon is a pure online company. That’s where LivingSocial, a Groupon rival in which Amazon made a major investment, comes in. For now, to get AmazonLocal from the ground, sales people from LivingSocial are roping in the merchants for the AmazonLocal daily deal offerings. But down the road Amazon is planning to hire its own sales force and that could mean Amazon will be competing against its own investment partner, LivingSocial.
Dealmap, a daily deal aggregator start-up, has been acquired by Google for an undisclosed sum; but certainly less than the $6 billion Google offered for Groupon last year. The acquisition provides a path forward for Google to enhance desktop and mobile location-based search.
Dealmap, which was founded in May of 2010, claims to have 2 million users and 85 million visitors who visit its partner network each month. Dailymap taps a total of 450 sources which are making available over 400,000 local daily deals a day.
For the time being, Google will honor the existing partner deals that are in place with over 50 distribution partners, including Local.com, MerchantCircle, T-Mobile, Microsoft’s Bing. Source
Webtrends, a veteran in web analytics, claims it is taking social media and Facebook marketing to the next level with Webtrends Social. This free suite of Facebook Page management tools allows Facebook Page administrators to build apps Facebook Pages, track ad conversions and perform a variety of community management tasks through the Wall Management feature. Although Webtrends Social is offering a slew of functions, what is missing from the feature list is an ad buying and targeting module. By adding this capability Webtrends Social hs the potential to become the most comprehensive Facebook Marketing tool in its class. We would therefore not be surprised if Webtrends acquires and integrates an ad buying and targeting tool, in the service in the not-to-distant future, to offer a complete solution.
We can imagine that, even without ad buying and targeting, Webtrends Social will be appealing enough for businesses that are currently managing their Facebook campaigns themselves using one of the other available services, to give it a try. For extended functionality and more users Webtrends charges $250.00 for a mid-tier service and up to $3,000.00 for an enterprise service.
With players like Involver, Buddy Media, Syncapse, Vitrue, Context Optional, Wildfire, and other social media management platforms already active in this space consolidation to may be four to five serious players is only a matter of time. Source
Groupon and Foursquare have agreed to work together to bring real-time location-based Groupon Now offers to the Foursquare service. Foursquare earlier this month made similar arrangements with LivingSocial, AT&T Interactive, Gilt Groupe and others. Foursquare users in the US can now find the Groupon Now deals under the Explore tab of the mobile Foursquare app and on Foursquare.com.
As with many other Groupon partnership deals Foursquare will receive an undisclosed cut from the Groupon deal earnings. Foursquare will be rolling out Groupon Now deals first in Chicago today and to other parts of the US and Canada by Sunday.
Foursquare and Groupon has been in discussion about this partnership since May of the year. Source
The latest entry in the crowded daily deal market, dominated by Groupon and LivingSocial and a host of other recent entries, including Google, Facebook and AT&T is publisher Gannett. The newspaper chain announced Tuesday it is expanding nationally a daily online deals business they initially launched in 10 markets, including Cincinnati, OH; Detroit, MI; Indianapolis, IN; Knoxville, TN; Nashville, TN; Phoenix, AZ; Reno, NV; Rochester, NY; St. Louis, MO; and Washington, DC. Gannett expects to introduce the service to over 50 additional markets in the US by the end of the year.
Gannett’s strategy is to push the daily deal service in the local media it owns, both online and traditional using the considerable local sales force of its newspaper and broadcast properties that knows the local markets, the communities, and their respective needs.
Deal Chicken is similar to other online daily deals services. People sign up to get a daily email that alert them to specific discounted deals for area retailers or restaurants. The discounts are then activated based on the number of subscribers who purchased the coupon. Gannett takes a 50% cut – although it varies – and passes the rest on to the merchant.
With Deal Chicken, Gannett is trying to diversify its revenue base beyond print advertising. The publisher of USA Today and 81 other U.S. daily newspapers has been battered by a downturn that has been particularly tough on its industry. Source
Electronic Arts Social and Mobile Game Revenues Rise in Q1 2012
Electronic Arts reported its Q1 FY2012 earnings this week with GAAP total net revenue at $999 million. This is a 22% increase compare to same quarter last year. Net income more than doubled to $215 million from $96 million. The company’s mobile revenues increased 10 percent from the same quarter a year ago to $57 million Electronic Arts’ digital revenues, which include streams from its social and mobile games, is now split almost evenly between mobile games and console content downloads reflecting the switch from traditional console-based games to social or casual games that run on iPhone and Android-powered smartphones. Electronic Arts is currently playing catch up in the social or casual gaming because it has been slower in adopting the free-to-play model than some of its smaller counterparts have endorsed year ago. Source
Distimo: 72% Of App Store Downloads Are Games
Mobile application analytics company Distimo has released a new version of “The Mobile Gaming Trends: Popularity, Pricing and Monetization” report, which covers trends in the mobile casual and gaming market. The current issue which includes data from the Apple App Store, Blackberry App World, Google Android Marketplace and the Windows Phone 7 Marketplace, notes that just 10 publishers account for more than half of all downloads in the top 300 most popular paid games for iPhone.
The overall revenue generated by the top grossing games in the Apple App Store increased by 79 percent year-on-year, but the average selling price of mobile games declined by 28 percent compared to the same month last year, while the revenue from the top freemium iPhone games increased tenfold. Virtual currencies is a hugely popular revenue generator in mobile games with 35 percent of the top 300 free games in the Apple App Store using in-app purchases to monetize the game.
When comparing apps versus games downloads in the Apple App Store, the report noted that 72 percent of App Store downloads are games, while the other 28 percent are regular applications. Source