TNS Technology Blog

Tablets, a fantastic opportunity for MR

It seems to be an inconvenient truth that in market research, despite learning more and more about the importance of emotional engagement in terms of CAWI respondent interaction, there's plenty of room for improvement. Let's face it, CAWIs can be a little underwhelming from a respondent's point of view, and dare I say it, in some cases a bit dull? I propose a solution - tablets!

As Fiona posted before, tablets are slowly, but surely, playing a larger role in this Brave New World but have not quite managed to find a home in most non-nerd circles. As we have seen the explosion of smartphone growth, I believe we will see huge growth in the tablet sector as well. Modern flagship devices from Android, such as the Samsung Galaxy Tab 10.1, or Apple's iPad2 are extremely capable media consumption and production devices. The barrier to growth seems to be perception of a) price and b) capability. Going back to Fiona's example, why would I want to spend $800 on a device on which I just Skype Nanna? Firstly prices will continue to fall. The Indian government, for example, has just subsidised the cost of an entry level tablet- the $30 Aakash tablet, that is eminently affordable. Admittedly, it hasn't got all the bells and whistles of a modern flagship device, but it would still be very capable of running multimedia apps. As Fiona points out, tablet penetration in developing countries is still very low, but for this reason things may be about to change. Secondly, on the issue of capability, developers will, and indeed are, finding new ways of making this new technology a compelling and fresh format. For example, we are now able to download a newspaper to a device, and watch embedded video clips as the author intended. Children's books are now available that combine music, video and interactive games. The use of educational software in educational establishments has increased exponentially - just do a search for educational iOS software for example. Schools and universities have certainly been able to put them to good use, even hospitals! There are countless other examples of this.

So what is the significance for the market research industry? Quite simply, quite a lot! I see a future in which respondents are able to swipe and move a concept around in 3D using the touch screen. Interviews will contain videos or audio to demonstrate concepts. Respondents answer questions using swipe to drag and drop, and sliders (as it was intended), while moving deftly around menus and content. The tablet's front facing camera will allow respondents to record videos of reactions to concepts.

Except, er, hang on a minute, some of this is already happening right now. We are therefore nearly there. Just imagine what the collaboration of games developers for smartphones/tablets and the Market Research industry could bring about? Gamification goes absolutely perfectly with tablet interactivity. This might seem like a trivial aside (bear with me), but look at the explosion of the smartphone game Angry Birds. The reason behind this was its fun game play, its simplicity and the touch screen interactivity. Similarly, I'm sure gamification could be employed, drawing on these principles, to make touch screen interface work very effectively. Animation and gameplay could accompany each question change, making the user experience more inviting and just more fun. Oh, but respondents would get distracted by the games, I hear you say. Well, I don't believe it would. Indeed I think it would reverse the traditional downwards graph of respondent motivation as the interview proceeds.

Essentially, the beauty of tablets and smartphones is fun. Laptops and PCs are starting to look antiquated. According to the late, great, Steve Jobs we are now living in a post-pc world. Tablets have brought with them an excitement to the extent that many people rushed out to buy one without really knowing why! The beauty of touch screen is that you feel closer and more engaged in the content. I love reading articles on my iPhone -it just seems to be more natural and intuitive to scroll text with a push of a finger over the click wheel of a mouse. Isn't such increased emotional engagement just what the Market Research industry should be aiming for? I am convinced respondents would love a fresh approach to MR and I would hedge a bet that data accuracy would increase dramatically.

Yes, I hear you say but what about older, less tech-savvy respondents? My response would be that iPads are used by thousands of grandparents believe it or not - just do a web search and you'll be surprised. Tablets and smartphones actually make technology far more accessible. My aged dad, for example, took to his iPhone like a duck to water. I'm convinced he'd never be without one now.

I'm convinced that, as sure as there'll always be death and taxes, a) tablets are not going to go away and b) people will always be bored by uninspiring, dull tasks. As tablet penetration steadily increases, I feel a golden opportunity right here.

Tablets: That Additional Device…

I’m sure in a few years time there will be a terrific Harvard marketing investigation into the release of the Tablet. Like so many other people, I acquired a Tablet without really needing one, or knowing what I would do with it. I chose the Motorola Xoom to fit in with my Android-fuelled lifestyle. It was acclaimed to be technologically more advanced and powerful than the other Tablets on the market, perhaps contributing to its severely inflated price point (USD$800) – let it be noted that I was actually given the device – I'm still not sure whether I would have paid that much for it...

As with a real baby, once I got this device home I looked at it and thought “what the hell do I do with you now?”. Living in Australia, where consumers have circa 6 technology devices, it certainly didn’t find an immediate home amongst my work computer, personal laptop, Android smartphone, iPod, TV, DSC… etc… etc. But I guess I wasn’t alone in this situation with 70% of other Australians and 59% of Tablet owners globally purchasing their Tablet as an additional device rather than as a replacement for their PC or Mobile.

For a few months I felt at a loss trying to force this device into my life – I tried everything – in front of the TV, on planes, at work, in hotel rooms, at friends’ houses… but nothing really gelled for me.

One thing was clear – for maximum utility, the device needs continual network connection. For successful adoption into an enterprise environment I feel this is a particularly important point. My Xoom is WiFi enabled only, severely restricting its functionality and often reducing it to a very advanced music device or calendar.

It was when I had my nerd hat on one day and was trolling through technology review sites that I began to understand the potential of this category. I read some articles describing the future use of Tablets and their integrated role through all facets of the consumer home – from home security to entertainment to business, and more impressively, their seamless linkage to the outside world. Descriptions of how the Tablet could function as a centralised control system (on top of the functionalities that we are already aware of) clearly demonstrated to me that this device is still very much in its infancy. Surely making this kind of integration as seamless as possible with a portfolio of devices presents a strong business model for brands?

But that’s the developed world. What about the emerging markets? The role and potential of the Tablet in the emerging world is bound to be quite different. Adoption levels are still low (recorded at 1% in Mobile Life 2011, compared with 7% in the developed markets) as consumers prioritize other technology devices (typically the Mobile or even the PC). Without the portability and flexibility of the Mobile, and lacking the functionality of a PC, the higher price point is much harder to justify when disposable income is low – the Tablet still lacks a compelling argument here. In my mind opportunities exist in the entertainment space – providing a storage and viewing platform for imaging (and even supplying the camera), facilitating a personal entertainment environment within crowded living situations, boasting good power management, and still allowing mobility are aspects that are likely to entice consumers. The other winning ticket the Tablet holds in these markets is (typically) a lower price point than a PC.

However these are just my thoughts, I’d love to hear yours.

Oh, and for the record, my Tablet now gets picked up about twice as often around the house and is great for watching TV shows on plane rides… however the greatest utility I've gained from it is leaving it at home and allowing my 91 year old Nanna to Skype me when I'm not around… but that’s another story all together!

Pondering the next frontier for mobile telecoms in Sub-Saharan Africa

 
The growth of mobile lines in Africa to over 500 million in a space of 10 years has shown the possibility of transformation on the continent. The entrance of mobile telephony in Sub Saharan Africa was unexpected and discussed with much scepticism as analysts considered the unit costs of owning and maintaining the mobile phones as beyond what common people could afford - especially given the competing basket of spend items. The reaction of the market to the introduction of mobile phones showed that the analysts had overlooked a number of issues. Firstly, there was a strong revolutionary drive to have access communication due to the failure of government fixed line networks. Only a few countries in Southern and East Africa had some form of reliable fixed line networks. In West Africa, Ghana was about the only nation with such. Secondly, mobile phones were not a luxury or lower level priority for the African market – they were amongst the essentials. They were competing with primary needs such as transportation. Thirdly, analysts overestimated the consumer cost of entry. The African mobile market took off on the platform of affordable handsets both new and second hand. China has played an instrumental role in providing affordable handsets that have driven the market. Due to network reliability issues and relatively low tariff charges within networks, a secondary or alternative line market has blossomed with some users having up to four lines per user. This has created a whole new platform for market growth.

The early battles for the network companies have been focused on providing network coverage and recruiting ready subscribers. However, with a penetration of 50% plus, most African markets have begun slowing down on their growth. This slowdown is driven by a number of factors of which I will mention only a few. Africa has a very youthful population with about 60% of the population below the age of 25, which inhibits ownership of mobile phones as this segment is just barely beginning to be economically independent. Although this age group is open to technological advances, it has limited economic ability to back its interests. Secondly, Africa has a large proportion of people living below a dollar a day. About 70% of Africa is estimated to be under socio economic classes DE. Although, the mobile phone is still important to them, its relevance is yet to justify ownership as this population has access to community and family handsets and therefore needs stronger motivation for personal ownership – given the associated costs of ownership. It is important to note the “sharing” or “collective” model to accessing resources in Africa – especially rural Africa.

The 500 million subscribers in the market have brought in stern competition amongst the network providers. With Airtel entering the market in last two years and introducing its low cost approach to the market, the market has slid into a price driven battle for share. The price battles have grossly eroded the ARPU of most network companies leaving them with minimum resources to invest into subscriber value. This has led to an over-focus on tariffs without consideration of the value proposition to the subscribers. Driving to many questions on the future of mobile telecoms in Sub Saharan Africa. How do these price battles affect growth? What is the sustainable route for the mobile telecoms providers to take?

The next steps to growth…
It is important for mobile telecoms providers to be clear about where growth will come from. They need to quantify and prioritise these sources of growth. Firstly, given that the market is now over 50% in penetration, this means that the ground for fresh uptake into the category is drying up. It is means that those who are likely to be the targeted recruits to the category are becoming more difficult. They are likely to have lower paying ability and also not perceive the relevance of spending on mobile phones. This redefines the business of the mobile service provider who has to learn a lot for the BoP models normally applied by social institutions. A lot can be learnt from the MPESA (mobile money) model applied in East Africa where the use of the mobile phone to a great extent went in the direction of banking and payments than in peer voice communication. There are current considerations for mobile health and social tools which are under implementation that may increase the relevance of owning the mobile handset for those who are currently not subscribers. How viable is this market and what are the critical success factors required to excel in this?

Secondly, given the price wars in the market and the heavy discounts being offered for services “within network”, there is a surge in the uptake of secondary and tertiary lines to maximise on these benefits. The development of data led services has also driven up the uptake of secondary lines. The upper segments show a high disposition to new gadgets with 10% of current subscribers in Nigeria showing a high interest in purchasing tablets in the short term (mobilelife 2011). There has been tremendous growth in mobile broadband across the region also linked to the growing number of submarine cables providing broadband capability to many providers and rapid developments in rolling out WiMax technology. So how much growth can really be driven by this secondary and tertiary market and is it sustainable? How much of this growth can be driven by the mobile data market?

Thirdly, the price wars have driven significant churn in the market and have redefined mobile telecoms provider marketing communications. Is this sustainable and how can it work in the favour of the mobile telecoms provider? There is a question bothering most CEOs and CMOs of mobile telecoms provider in Sub-Saharan Africa and that is on the sustainability of differentiated positioning in a commoditised “utilities” market. This explains how most of them have followed the price wars which now risk the sustainability of the industry. The mobile telecoms providers realise the fast pace of the industry and are pondering on how traditional marketing solutions can help in this context. Is segmentation feasible and sustainable in this industry? Are there strongly differentiated needs amongst subscribers in Sub Saharan Africa and are these needs if differentiated, sustainable? Is it sustainable to pursue niche markets? Can they provide a return on investment given the significant capex outlay? Do the traditional long-term innovation models apply to the industry whose future is so difficult to anticipate or is it better to just innovate around the tariffs and short term offers to avoid non-productive R&D expenditure?

Fourthly, is it realistic to consider avenues of increasing ARPU by borrowing from borderline services and bundling content related products? These are the questions hovering around C -level executives and much debate is still required for a better enlightened understanding of how to overcome the next frontier of mobile telecoms in Sub-Saharan Africa.

Did you know that globally, people spend 3,000,000,000 hours a week playing games online?

In most developed markets mobile broadband is already a commodity, fully integrated into daily life.

Last week we presented the results of our annual mobile life study (www.discovermobilelife.com) at the Mobile Gipfel in Bonn, Germany (http://www.managementforum.com/Veranstaltungen/Mobile-Gipfel/index.php) highlighting the importance of mobile broadband as a global trend . It was clear from all of the speakers that the impact mobile broadband is having on businesses is enormous.

Look at the gaming industry. It is clear, people love gaming. Did you know that people all around the world play 3 billion hours per week of games online?

Did you know that US kids (up to the age of 21) spend 10,000 hours gaming? (Only 4,000 hours less than they spend in school.)

And most of these games are played using mobile broadband.

So, make your business a game, understand what people buy offline, create an app that fits the path to purchase. Combine the virtual world and real life.

Mobile business is all about reaching the consumer using fresh, innovative and device-enabled ideas. It’s about presenting your brand as a multi-channel experience.

Consumers are increasingly self confident and well informed. Reaching them through mobile advertising, implementing new ideas and business models to monetize smartphones and tablets will be key. But, there is still a lack of knowledge, resource and ideas.

Mobile broadband facilitates market knowledge, traditional research, measurement of mobile devices, inapp-research…

Make mobile top your agenda for 2012! It is certainly top of ours!

Gabri

Social as horizontal, not vertical, please

Stephen Yap, Group Director, TNS RI UK stephen.yap@tnsglobal.com

Attention, questionnaire writers: please, please, never again refer to social-networks as a single type of PC or mobile activity.

From their roots as messaging services, social-networks have rapidly expanded to encompass all kinds of functionalities: chat, gaming, events, blogging and more. Facebook has for years been the world’s largest photo-sharing site, while social video is the fastest-growing corner of the web.

In fact, photo and video are Facebook’s “killer apps”, whose success has come at the expense of standalone photo-sharing sites, which have seen their usage plateau or decline in Facebook’s wake.

I am reminded of Microsoft back in the days when it bundled IE with Windows and quickly killed off Netscape. Microsoft and Facebook have both built their success on building platforms that aggregate functionality and create a network-effect which attracts more users and raises barriers to competition. Nowadays Facebook’s proposition rather resembles that of Windows; offering a full array of information, communication and entertainment services. It’s no surprise that while Google still has more unique users, Facebook has surpassed its rival in terms of total time spent.

Just as Microsoft attracted criticism for allegedly monopolistic practices, Facebook has been subject to high-profile scrutiny around how it handles its users’ data. People are inevitably sceptical of the motives of companies that are so ruthlessly successful, yet the technology industry has always been about finding the core idea that generates a virtuous circle.

The core idea underpinning social-networks - that your contact-list is the ideal foundation for a consumer cloud – is redefining traditional categories and boundaries. Is it an application, a site, a network, or an operating-system? How about “ecosystem”? One thing is clear: Facebook, LinkedIn and their ilk are becoming increasingly horizontal, and increasingly are capturing a lion’s share of consumer attention and consumer equity.

Stephen

Social Networking & the Power of Social Media in Indonesia – we ain’t seen nothing yet!!!

James Fergusson, Managing Director, TNS Global Technology Sector James.Fergusson@tnsglobal.com

I’m in Indonesia this week – a fascinating rapidly urbanizing and huge growth market characterized by a fast emerging middle class. Mobile phones are playing a key role in this transition. Like many rapid growth markets Indonesia is characterized by leap frogging behavior when it comes to technology and digital usage.

Indonesia is already the world’s 2nd biggest Facebook and Twitter market in terms of number of members. However research by TNS reveals that this huge penetration is not translating to heavy usage with only 14% of Indonesia’s online population accessing Social Networking Sites on a daily basis compared to the Global average of 46%.

Currently many Indonesians rely on either ICafes or older generation smart phones to access the Internet. The inconvenience of getting to an ICafe and the cluttered operating systems of older phones compromise the user experience and frequency of Internet access and Social Networking usage.

I expect this situation to change rapidly! Over the coming months we will see an increase in Chinese manufactured new generation smart phones using the extremely user friendly and intuitive Android operating system in the market at a relatively lower price point – around USD$100. As is happing elsewhere in rapid growth markets we will see this drive a flood of more frequent Internet access.

The subsequent increase in Social Networking usage represents a huge opportunity for businesses operating in Indonesia, where 30% of online consumers would welcome online brand content and online Indonesians already have an average of seven brand friends – well above the global average of four. As such now is the time for marketers targeting Indonesian consumers to be planning their mobile digital strategies. The future of Digital in Indonesia is very much mobile!

James

China leads the mobile digital space

James Fergusson, Managing Director, TNS Global Technology Sector
James.Fergusson@tnsglobal.com

Sitting here in my Beijing Hotel room, rehearsing my Mobile Life presentation for our Chinese clients, it seems somewhat apt that I should dedicate this, my first blog, to China’s leadership in the mobile digital space.

Across the world it is clear that the future of the Internet lies very much in Mobile and China is setting the pace!!

China is the world’s biggest Internet market and the world’s largest mobile phone market. Combine these two factors and it easy to see how China now has in excess of 300 million people accessing the Internet via mobile phones.

This number is growing rapidly on the back of intuitive, and user friendly, locally manufactured Smart Phones which not only overcome the barrier of minimal fixed last mile services, but also make mobile Internet usage easy.

The proof is in the pudding! China already has the highest usage rates of mobile internet anywhere in the world and this usage continues to grow rapidly. Over the past 12 months social networking via mobile has increased significantly in China, as has microblogging and news consumption. Mobile internet access in China is growing far faster than any other digital access medium.

China is really setting the pace! China is becoming the benchmark for other growth markets – all players in the mobile phone industry must look to China in planning their expansion strategies for the key growth markets of India and Sub-Saharan Africa!

There is however one aspect of Chinese Internet Usage that worries me – why does it peak in the late evening when people are lying in bed??? Perhaps the topic for next month’s blog?

James