Key data. Executive Summary. December, Latitude Findings. Latitude 2011 Quickstats
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1 Client X 2011 Market Mobile Snapshot Review Key data Executive Summary December, 2009 January 2012 ben.wightman@latitudegroup.com janet.plumpton@latitudegroup.com 8% 7% 6% 5% 4% 3% 2% 1% 0% 2011: % of Website Visitors by Device Mobile Tablet Latitude Findings 11.9% of all website visits now come from Tablets and Smartphones. Consumer web behaviour is proving increasingly multi-screen in nature. 13.4% of all Paid Search clicks now coming from Mobile & Tablet. 2.5 times as many clicks as Yahoo & Bing paid search combined! 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% E-Commerce Conversion Rate by Device Desktop Mobile Tablet Q4 2011: Paid Search Average CPC Mobile CPCs remain cheapest, despite Q4 reductions in Desktop & Tablet CPC. Q4 sees huge growth in Tablet usage, with 48% Visitor growth against Q3 and 186% against Q1. Latitude 2011 Quickstats By December % of Unique Visitors arrived from Smartphones and 4.3% from Tablet PCs E-Commerce Smartphone conversion rate peaked at 2.1% during November Q4 Avg CPC 9% of all Paid Search clicks now come from Smartphones and 4.4% from Tablet PCs Q4 Mobile Paid Search CPC averaged 0.26, compared to Tablet at 0.31 and Desktop at Desktop Mobile Tablet UK Smartphone penetration now at 45% - almost half of the UK now has access to the mobile web. Latitude is a world leading digital marketing agency, offering PPC, SEO, conversion analytics, online display, social media, video and affiliate marketing services. We help companies maximise return on their marketing spend through a focus on measurement. We publish sector summaries every quarter to give insights into digital marketing within your industry. For more information go to or call
2 2011 Mobile Traffic Overview 2011 Review: The Year Mobile Arrived There is generally wide consensus between search engines, business analysts and marketers that 2011 was at last The Year of Mobile. Consumer use of the mobile web went mainstream and businesses adapted with tailored mobile websites and mobile specific marketing campaigns. Google reported that by October 2011, UK Smartphone usage had reached 45% of the population, compared to 30% in January, putting the UK ahead of France, Germany and even the United States in terms of Smartphone penetration. We are adopting the mobile web into our day-to-day routines too; Google s survey also found that 54% of all Smartphone owners now use their handsets to access the web on a daily basis. UK consumers also embraced Tablet PCs and the latest figures from AdMob suggest 10% of UK Smartphone owners now also use Tablet devices. To measure the trends of the mobile web, we investigated 2011 web analytics and paid search stats from a range of sectors. We found that by December on average 7.6% of all website unique visitors arrived from smartphones and 4.3% arrived from Tablet PCs. This means 11.9% of all website visitors are now coming from mobile. Compared to the preceding January this equates to a 65% increase for Smartphone share of visitors and an incredible 355% increase for Tablet share. 8.00% Proportion of Website Visitors by Device 7.00% 6.00% 5.00% 4.00% 3.00% Mobile Tablet 2.00% 1.00% 0.00% Figure 1: Proportion of Unique Visitors by Device type 2011 Mobile Search Report - Latitude Digital Marketing Ltd. Page 2
3 Increasing Smartphone penetration is driving Mobile web usage. It s impossible not to comment on the contribution Apple and Android are making to growth; Apple have just announced record sales for the last quarter of 2011, with million iphones and million ipads sold worldwide, generating the company s highest ever revenue. Not to be outdone, Google have also reported a massive 250 million worldwide Android activations over the same period. Looking at trends for UK web visits by Smartphone operating system, we see that while the iphone still dominates Android based traffic has eaten into Apple s share - in the UK in 2011 the proportion of visits coming from Android phones almost doubled; to approximately 30% of all Smartphone-based traffic; 70.0% 60.0% Proportion of Mobile Visits by OS 50.0% 40.0% 30.0% 20.0% 10.0% iphone Android ipod Symbian BlackBerry Other 0.0% Figure 2: Proportion of Mobile web visits by device operating system We include the ipod in this graph due to its Smartphone sized dimensions. At the beginning of the year, ipods were responsible for 11% of all mobile visits (excluding Tablets). Visits from the device more than halved during 2011 to just 5% of total mobile visits, correlating with a fall in device sales. Given Apple s record iphone and ipad sales figures and the fall in ipod web traffic, it seems possible that many ipod owners are now migrating to the alternative Apple devices Mobile Search Report - Latitude Digital Marketing Ltd. Page 3
4 Figure 3: ipod Sales Source: Apple We have also been looking for signs of life from Microsoft - in February 2011 Microsoft & Nokia joined forces to create a three horse race between Windows Phone, Android and ios. The partnership has made little impact on the mobile web so far though. Symbian share of visits has halved through the course of 2011 following Nokia's decision to drop the OS, however Windows Phone share of traffic has not grown at an equivalent rate and still falls into our low volume 'other' category. If Windows Phone fails to catch on with mobile web users as these stats suggest, we would not be surprised to see Nokia attempting to salvage their market share with an Android partnership in Review: Mobile Web Engagement As the proportion of mobile web visitors has increased, patterns of usage have evolved between devices. We have noted in previous reports for example that website visits from Mobile users were typically quick, focusing on obtaining information, producing lower conversion rates as users tended to complete purchases either in-store, by phone or via desktop / tablet. As Mobile web usage has become more mainstream though, we are starting to see increased website engagement from mobile visitors. Looking at the average page views for sites through 2011, we see a pronounced peak in Q4 for Mobile, indicating the device has become an important tool for festive buyers. Content consumption via Mobile remains lower overall than desktop and tablet, however slower 3G network connection speeds may be the obstacle here. Looking ahead, 4G is due to be launched in the UK in 2013 and promises connection speeds similar to current broadband. We would anticipate that by the end of 2013 not only will Mobile web visitors be as numerous as those from desktop, they ll quite possibly consume greater amounts content Mobile Search Report - Latitude Digital Marketing Ltd. Page 4
5 6.0 Average Page Views per Visit Desktop Tablet Mobile Figure 4: Average Web Page Views per visit by device type Looking at E-Commerce sites specifically, we observe that conversion rates for Mobile are also faring well, averaging around 2% during November and December with many retailers now benefiting from mobile optimised websites. Interestingly as Tablet visitor volumes have increased, conversion rates have dropped and now fall in line with desktop; Tablet visitor volumes increased by 186% in Q compared to Q1 nearly 3 times as many visitors - but volumes didn t actually take off until June, coinciding with the fall in average conversion rate. Although early Tablet adopters have previously been associated with affluence, it seems increasing uptake of the device is making performance more representative of the UK web demographic as a whole Mobile Search Report - Latitude Digital Marketing Ltd. Page 5
6 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% E-Commerce Conversion Rate by Device Desktop Mobile Tablet Figure 5: Average E-commerce conversion rates by device type It seems likely that as Tablet visitor volumes increase, we ll see conversion performance begin to mirror desktop more closely. While Smartphone web searches are largely complementary to desktop, according to AdMob research in the US it looks as though Tablet traffic may begin to cannibalise Desktop traffic. In a survey of 1430 Tablet users, AdMob found that: 77% of respondents said their laptop usage decreased after buying a tablet 28% said the tablet is now their primary computer 82% said they primarily use their tablet at home Across the data surveyed we found that Tablet visitors still produced the highest average order values. Although Mobile visitors generally placed the smallest orders, the AOV was only 8% less than desktop Mobile Search Report - Latitude Digital Marketing Ltd. Page 6
7 AOV by Device Desktop Mobile Tablet AOV Figure 6: Average E-commerce Order Value by device 2.00 Avg. Revenue Per Visit Rev Per Visit Desktop Mobile Tablet Figure 7: Average Revenue per Website Visit, by device As we have noted in previous reports, while Mobile conversion rates and AOVs may seem to underperform against Desktop and Tablet, Mobile visitors will often convert via other channels. Recognising this behaviour, the challenge for businesses and marketers in 2012 will be to remain prominent with the most relevant messaging as the consumer journey moves between screens Mobile Search Report - Latitude Digital Marketing Ltd. Page 7
8 Review: Paid Search Overview Latitude continues to see consistent growth in the proportion of paid search clicks coming from Smartphone and Tablet devices. By December, these devices accounted for 13.4% of clicks and 10.6% of paid search spend. 9% of clicks came from Smartphones and 4.4% came from Tablet, which increased more than three-fold from 1.4% in June. Following these trends we estimate that by the end of 2012 we ll see 20% of paid search clicks coming from Mobile. 16.0% Mobile (inc Tablet) as % of Paid Search Totals 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% % Total Impressions % Total Clicks % Total Cost 2.0% 0.0% Figure 8: Mobile & Tablet proportion of Paid Search totals Mobile continues to offer the cheapest click costs and average CPCs remained fairly consistent through the year. In Q4 we measured an average CPC of.26 from Mobile, compared to 0.31 from Tablet and 0.37 from Desktop. We did however observe falling CPCs for Tablet and Desktops between Q3 and Q4, a trend that occurred in several sectors, notably retail and gaming. This is possibly a result of rising searches in the holiday season leading to volume discounts for advertisers Mobile Search Report - Latitude Digital Marketing Ltd. Page 8
9 Paid Search Avg CPC by Device Q1 Q2 Q3 Q4 Desktop CPC Tablet CPC Mobile CPC Figure 9: Average Paid Search click cost by device (note: Adwords segmentation for Tablet stats released end of Q2) The trend in relative CPC levels does vary by sector though. Competition for Tablet clicks in the gaming and home renovation sectors made average CPCs higher than desktop, while the legal sector in particular appears to have an opportunity for significantly cheaper clicks from mobile. Q4 2011: Paid Search Avg CPC by Sector Desktop Avg CPC Tablet Avg CPC Mobile Avg CPC Figure 10: Paid Search average CPC by sector 2011 Mobile Search Report - Latitude Digital Marketing Ltd. Page 9
10 Optimising for Mobile continues to offer advertisers a chance to achieve improved CTRs. We saw average CTR for Mobile campaigns increase from 4.7% in Q3 to 5.7% in Q4 as the holiday season drove buying interest, compared to Desktop rising from 2.9% in Q3 to 3.2% in Q4. Tablet CTR averaged 3.8% in Q4, unchanged from Q3. The high Tablet CTR in Q2 is attributed to a skewed data set prior to full segmentation of Tablet stats in Adwords. 6.0% Paid Search Avg CTR 5.0% 4.0% 3.0% 2.0% 1.0% Desktop Mobile Tablet 0.0% Q1 Q2 Q3 Q4 Figure 11: Paid Search average Click-through Rates Organic Mobile Search in 2011 & what we can expect from mobile in 2012? In our last Mobile report we took a look at the percentage of natural search visits that were referred through mobile handsets. Our study covered a variety of sites and indicated that as to be expected the percentage of search through mobile is steadily increasing. Our findings indicated that the average percentage of organic visits through mobile (including Tablets) rose from 9% in January to 13% in September. In this report we will be taking a closer look at retail sites. Why? Well because there has been the notion that many shoppers use their handsets to research prior to completing a transaction on a desktop. The general consensus was that users felt less protected ordering and paying for goods on their mobile. Our Q3 mobile report featured stats from a study by the IAB which advised that consumers are beginning to become more confident when purchasing through the mobile web Mobile Search Report - Latitude Digital Marketing Ltd. Page 10
11 Let s see how the trend is shifting for organic search and when a site falls below the average percentage of transactions completed through a handset what is going wrong? Mobile visits to E-commerce sites through organic search Percentage share of mobile visits referred through organic search Organic visits to retail sites through mobile handsets rose steadily throughout the year with a significant increase witnessed during December due to the Christmas period. Are visitors to retail sites looking for gift ideas, making price comparisons or actually completing orders online? The following section will take a look at the spending behaviour through mobile search Mobile Search Report - Latitude Digital Marketing Ltd. Page 11
12 What percentage share of transactions arrives through mobile? Share of transactions referred through mobile organic search The percentage of transactions completed through mobile search rose most significantly in Q4 of Of all organic transactions recorded through our study almost 11.61% were completed on a mobile handset in December. From our study the lowest percentage share of mobile organic transactions in December recorded was 6% compared to a high of 13%, when we take a look at the sites we can learn further as to why this is. The sites with a lower than average percentage share of mobile transactions are difficult to navigate, take longer than average to load and have very fiddly forms which are most difficult complete. If you haven t done so already, complete a test order on your site and be very objective. Are there any obstacles when it comes to completing a transaction? If there are difficulties completing orders look to rectify any issues and streamline the process in order to really take advantage of the soaring increase in mobile search. Google s HowToGoMo resource can help when assessing the usability of a mobile website Mobile Search Report - Latitude Digital Marketing Ltd. Page 12
13 Organic listings and mobile sites Due to the difficulties often experienced when presenting the desktop version on a mobile handset with limited screen size, the popularity of mobile sites has risen dramatically. The compact, faster-loading sites invariably have larger buttons and provide just the required information necessary to a user on the go. There can however be difficulties with these condensed sites when it comes to providing exactly what your visitor is looking for. There have been a number of instances where a search query for a particular product has presented the item in the listings only for the visitor to be redirected to the home page of the mobile site. In these instances it would be more worthwhile to serve the full desktop version and retain the customer journey (albeit slower) than losing that customers goal. Take a close look at your analytics data to uncover where particular search terms are failing to convert through mobile with a view to improving your user journey for these queries. Smartphone Googlebot-mobile in 2012 Google announced mid-december that a Smartphone user-agent has been added to Googlebot- Mobile. This new spider is to provide a better search experience for Smartphone users. It has been known for some time that the natural search results on a handset can vary from those on desktop; local results, different algorithms and bots all play a factor in this. Now with the new Smartphone user-agent it is expected that search results on mobile may be distinguished further from desktop. Websites that are not optimised for mobile are likely to lose rankings in search results pages. Another development with the new crawler is Skip Redirect for Smartphone optimised sites. When a Smartphone user selects a listing in Google which provides Smartphone optimised content the link will point directly to the Smartphone optimised URL cutting out the redirect and helping to speed things along and maintain a smooth customer journey. In light of these new developments it is essential to make sure that your website renders correctly on a Smartphone and contains the correct mobile DocType to help Google match your webpages to mobile search queries Mobile Search Report - Latitude Digital Marketing Ltd. Page 13
14 Mobile Display Networks With rapid growth in mobile website visits during 2011, we are now seeing increasing demand for Mobile specific Display campaigns. Mobile presents a great opportunity for advertisers; image banners on Mobile are substantially more prominent and we see click through rates improve by up to ten times when compared to desktop targeted counterparts. Latitude expects adoption of mobile display advertising to increase in 2012 as the number of mobile-optimised websites increases. Sophistication in ad formats will also aid growth more interactivity built into with display ad formats will mean that actively engage an audience, rather than simply displaying a message. Best Buy have received plaudits for their mobile optimised website and we liked their Mobile Display banners too, which open up when clicked to reveal an instructional video helping viewers with their TV connections. We also expect Mobile Display advertising to be driven by Real Time Bidding in RTB provides real-time auctions that enable buyers to compete for and buy individual ad impressions that best serve their campaigns. The value is shared by buyers and sellers alike buyers purchase only the impressions they want and publishers and developers benefit from a higher price and increased demand for their ad spaces. The resulting powerful and mutual value pushes RTB onto centre stage as the strategic foundation for mobile advertising in Mobile Search Report - Latitude Digital Marketing Ltd. Page 14
15 Search Engine Developments for Mobile in 2012 At the beginning of 2011 Google reported that 79% of major online businesses did not have a mobile optimised website. Google followed up with a host of new tools to help webmasters and marketers to adapt to an evolving multi-screen audience. Google sites for Mobile a free tool to build a mobile optimised website using templates. This provides an excellent option for small businesses on limited marketing budgets. HowToGoMo a Google initiative to help businesses understand how their website is seen by mobile users, including resources to help build mobile optimised websites. This is a great tool for quickly assessing how well a website is serving mobile visitors Mobile Search Report - Latitude Digital Marketing Ltd. Page 15
16 Changes to AdMob bring all mobile web ad placements to Adsense, while AdMob specifically caters for in-app advertising. Google say the change will make ad management more streamlined and will cause less confusion for advertisers, as the two products had previously overlapped. Google s Keyword Tool updated to provide mobile specific keyword data. The Mobile Query Builder. This feature lets you construct phrases a word at a time from a list of suggestions. It s also a great tool for PPC keyword ideas. Quality score bonuses for Adwords advertisers with mobile optimised landing pages. Google announced in September that businesses with mobile-ready websites would benefit from increased Adwords traffic at lower cost Mobile Search Report - Latitude Digital Marketing Ltd. Page 16
17 Top 10 Latitude Predictions for 2012 Smartphones will account for 10% of all website visits by the end of A further 7% of all website visits will come from Tablets by the end of As many web visits will come from Android based phones as ios by the end of the year. Mobile and Tablet collectively will represent 20% of all Paid Search clicks. Mobile conversion rates will continue to improve as more sites become optimised for mobile. Google will introduce algorithmic penalties for websites that are not optimised for mobile. Affected websites will see drops in Adwords quality scores and Organic rankings. Nokia will announce plans to release Android based handsets following low consumer adoption of Windows Phone. iphone5 to be released late Q3? Guaranteed to get huge press coverage, this will be another major growth driver for the mobile web, both in terms of buzz and in terms of hardware hitting consumers hands. NFC will achieve widespread consumer awareness. NFC is expected to feature in the iphone 5, while Samsung & Visa have joined forces to promote NFC during the Olympic Games. The two companies have partnered to produce an NFC contactless payment equipped Smartphone which will be handed out to all athletes (and of course made available for sale). TV broadcasters and advertisers will adapt to a four-screen audience. Programmes and TV ads will increasingly be augmented with tablet and Smartphone based services. Look out for the BBC s four-screen approach to the Olympics this year. How to get in touch To take the next step to success and receive a FREE audit of your mobile paid search campaign, contact mike.kirwan@latitudegroup.com now Mobile Search Report - Latitude Digital Marketing Ltd. Page 17
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