Tag: Google

Location, the key to Mobile Advertising’s future

Mobile advertising has been a hot topic for a long time, but hasn’t really taken off. Prices and revenues remain low despite the fact that consumption of mobile content is at an all time high. But the two giants Google and Facebook now are willing to get things moving faster.

Recently, Google CFO Patrick Pichette, speaking at the Bank of America Merrill Lynch Technology Conference in San Francisco, declared  “I am convinced that the margins on mobile have to be higher than on desktop. […] The premise that mobile has to be a lower CPC [cost per click] because today it’s a lower CPC doesn’t make sense.”

The key to the success of mobile advertising: Location

The revolution brought by smartphone is bringing radical changes in the way marketers can address end users. Mobile technologies bring a new dimension to the data that are used to better understand customers: their location.

Advertisers and marketers are looking for a means to differentiate their campaigns on mobile – and localization offers it by allowing them to truly pinpoint their target audience in real-time and manage their campaigns on-the-fly.

In a recent interview with Bloomberg, Carolyn Everson, Facebook’s vice president of global marketing solutions, said that the world largest social network is actively working on a location-based mobile-advertising product that will allow companies to target users with real-time data showing their whereabouts.  “Phones can be location-specific so you can start to imagine what the product evolution might look like over time, particularly for retailers. […] We’ve had offers being tested over the last couple of months.”

In a recent Insight report, JWire confirmed that the potential of revenue from mobile advertising is increasing, thanks to a shift in the consumer’s behavior. Contrary to popular belief, C-level executives and small business owners have become more tech savvy as they embrace location-based apps and find themselves more in tune with location than ever before. For example, 70 percent of C-level executives use location-based apps on a weekly basis or more daily. Likewise, 73 percent of small business owners are more apt to use location-based apps daily (57 percent) or on a weekly basis (16 percent).

No one now questions the fact that the future of mobile advertising is location based. However, the role of each actor of the market is still to be decided. Mobile operators, mobile application editors and hardware manufacturers all have a hand in locating their end users. Who will be able to monetize this precious data remains to be decided.

Competition between Mobile Payment solution intensifies

Earlier this year we reported about the growing trend of mobile payments on 2011.
Now that more than half a year has passed, it is clear that the battle has started and the next few months will be critical for the future of mobile payments. The technology is getting popular, with many new mobile phone models now equipped by default with NFC technology.

But the innovation is not only on the customer side. Vendors can now use mobile devices and networks to accept payments. First was Square. Their very simple solution of mobile payment lets almost anyone with an iPhone or Adroid device accept credit card payments at a very competitive price, relying on their internet connectivity to securely process the payment.

Soon, competitors appeared. Erply, which specializes in cloud-based point-of-sale solutions for mobile devices as well as desktops and laptops, has unveiled a new mobile credit card reader for handheld mobile devices.
Touted for both small and large businesses, the Erply card reader is designed to support traditional credit card processing as well as near field communications (NFC) technology.

And not later than last month, Intuit Inc. and Verizon Wireless on Thursday announced that Intuit’s GoPayment mobile application and reader are now available in Verizon Wireless’s 2,300 U.S. stores.
Intuit is another service of mobile payment, similar to Square and Erply.

As carriers seek to sell more services to small businesses, they’re increasingly seeing the value of offering payment applications with smart phones, according to mobile-payments consultant Todd Ablowitz, president of Centennial, Colo.-based Double Diamond Group. “Clearly what this says more than anything else is that carriers that can reach merchants and casual merchants are recognizing the value of payment acceptance,” he says.
“Payments and transactions are often the biggest hurdle businesses face,” Mike Schaefer, executive director of the Business Solutions Group for Verizon Wireless, said in a news release. “Our value proposition is to streamline, simplify, and enable business owners to get paid with minimal delay.”

Those who feel left out in this race are the Banks. It probably won’t be very long before they come up with an answer to these new competitors.

Telecom operators pushing towards mobile payments in 2011

Mobile NFC Payment is already deployed on limited areas in Japan and South Korea.

The trend observed in 2010 is now confirmed as numerous actors of the telco world are pushing towards mobile payments.

For years, the operators have been only a “pipe” for billions of transactions in the new economy. Today they are trying to get their share of a market estimated to $1.13 trillion globally by IE Market Research.

At the Mobile World Congress, held last week in Barcelona, telecom operators have been actively discusing a technology known as near-field communications (NFC), which allows consumers to buy items by tapping their phone on a specialized reader at the cash register. While this technology is not new, it is not yet widely used and not completely standardized. This year will be a turning point, as most of manufacturers will release NFC-enabled models on the market.

But this won’t be easy as taking this market involves competing with two other major actors:

First, the credit card giants Visa and MasterCard won’t let themselves be replaced and lose a lot of revenue from transaction fees without a fight.

Then Apple and Google are entering the row, providing software-based payment systems independent from operators and manufacturers’ solutions. Google plans this year to integrate it in its Android mobile operating system.
Apple is weighing putting a NFC chip in its next iPhone and could tie it to its widely-used iTunes payment system to control the mobile payment value chain like it has with music and magazines on the iPod and iPad.

Several start-ups have also created stickers and memory cards that users place on their phones to process payments. Visa’s contactless payment program, dubbed payWave, for example, relies on a memory card with a NFC chip in it.

In this race, operators are trying to find allies in the Banks. In the US, AT&T, Verizon, and T-Mobile formed a joint venture last year with Barclays Bank and Discover Financial Services. In France, the three competing mobile operators Orange, SFR and Bouygues have teamed up with several banks and tested mobile payments over a year where 3000 residents could use NFC-enabled phones to pay for public transportation and in a thousand local retailers.

However, the fight won’t be limited to developed countries. Emerging markets are said to offer even more opportunities for mobile operators, because Credit Card majors are much less present over there.