Just after the dotcom boom, from 2002 to 2003, when I worked at the largest digital media
company in the U.K., heading up the mobile advertising division was regarded as the short straw.
The agency went on to try several initiatives to kick start a business in this area but back then
clients just didn't want to know. There is an aphorism that says timing is nearly everything in
business and certainly the last few years has seen a totally different attitude to mobile advertising.
Since the advent of Apple's iPhone in 2007, the smartphone has risen to be the most important of
all connected devices and the amount of money spent by brands on mobile advertising has grown
rapidly. eMarketer forecasts that by the end of 2016 mobile advertising spend will exceed the
amount spent on TV advertising in the U.K. This is because many media folk believe that wherever
people are spending their time they should be subjected to a proportionate amount of advertising.
This attitude has been encouraged by venture capitalists, and in particular Mary Meeker in her
annual Internet Trends presentations. For several years Meeker has been saying the amount of
time people devote to various media should equate to advertising spend. Using this perspective
Meeker's 2015 presentation points out that people in the U.S. only spend 4% of their time viewing
print (newspapers and magazines) yet this receives a disproportionate 18% of U.S. advertising
expenditure. They spend 24% of their time using their smartphones yet this only receives 8% of
advertising expenditure. Meeker says “Print remains way over-indexed relative to time spent.”
Using this logic the outlook for newspapers and magazines looks bleak as publishers are heavily
dependent on advertising for their profits. And online media advertising will never generate
enough money for owners to fund operations built up around expensive printed advertising.
It is a paradox, apparently unrecognised by most, that virtually all the services that people value
online are funded by advertising. Think Google, YouTube, Facebook, Twitter, Yahoo, Pinterest,
Amazon etc. etc. They are all exclusively funded or part funded by advertising. But for advertisers,
the unpalatable truth is that the majority of people detest online advertising, and absolutely loathe
mobile advertising. It’s surprising that Mary Meeker and the other vulture capitalists who live along
Sand Hill Road (just outside Palo Alto in California's Silicon Valley) don't seem to have considered
this. Having lots of “big data” about the extraordinary amount of time people are occupied with
their smartphones doesn't mean that smartphone advertising is likely to be bigger than television
advertising. Far from it. For a start we are dealing with a small screen, on a very personal device,
and users are highly task driven and don't like being interrupted. Apple, because they are not
dependent on advertising for income, has already realised this – they now make the lion's share of
their income from selling hardware, the major portion of profit being derived from iPhone sales.
Apple's CEO Tim Cook recently said: “A few years ago, users of Internet services began to realise
that when an online service is free, you’re not the customer. You’re the product. But at Apple, we
believe a great customer experience shouldn’t come at the expense of your privacy.” As a result
the newly released iOS9 operating system for the iPhone allows for the easy creation of ad blocking
tools within Apple's Safari browser - so far Apple doesn't allow ad blocking apps. If you need
evidence of the general aversion to mobile advertising you will find ad blockers are always amongst
the most popular software to be downloaded to a mobile phone. The real problem for the
advertising industry is that they only measure the time spent on the smartphone, and whether an
advertisement is displayed or not - they fail to measure the annoyance factor and how much
negative brand association is created.
It was back in 1963 that Bruce William Cameron, a sociologist, wrote his book “Informal Sociology:
A Casual Introduction to Sociological Thinking” a phrase that has often been attributed to Albert
Einstein. Cameron astutely observed that at the time sociology was at a distinct disadvantage
compared to economics when he wrote: “It would be nice if all of the data which sociologists
require could be enumerated because then we could run them through IBM machines and draw
charts as the economists do. However, not everything that can be counted counts, and not
everything that counts can be counted.” It is the last line in this quote that is often attributed to
Einstein possibly because he had made a note of Cameron's observation. I've given the full text of
Cameron's quote because today if you are involved in any kind of “big data” analysis Cameron's
observation is particularly salient. As a sociologist Cameron understood that his work dealt with a
messy, shades of grey, environment where absolutely nothing is black and white. At that time
economists were plying their trade, much as they do today, with relatively simple models that are
capable of being depicted in a visually interesting form via charts and graphs. In order to do this
economists make many crude assumptions about human behaviour, not least that we are all
rational and logical rather than the emotional and illogical creatures we actually are. Economists
and sociologists use very different lenses to try to interpret human behaviour, and one would have
thought that economists would have understood this by now and, realising that their models are
far too simple and deterministic to be useful, borrowed some of tools and techniques used by
sociologists. That they clearly haven't is primarily due to the rigid mathematical framework that
constitutes the education of most economists.
I've written before that, whatever aspect of human behaviour is being analysed, we need to be
aware that the data we look at usually only exists because it has been easy to capture. Hence the
relevance and importance of “not everything than can be counted counts.” The information or data
that would be really useful may not even be possible to capture, or be prohibitively expensive to
acquire, so “not everything that counts can be counted.” I'm emphasising Cameron's quote
because with “big” data the tendency is to jump in and start using software tools to look for
correlations instead of reflecting and considering the “missing” data that might be needed to make
a genuinely useful analysis. By thinking about the missing data you get a much humbler
appreciation of the data that you do possess. This is something the advertising industry should be
studying as they appear to have no real measurement data about how annoying or successful a
mobile advertisement essentially is.
The big data I’m analysing this month is very big indeed as the aspect of human behaviour I'm
observing is derived from one of the most measurable devices that modern human beings use, the
smartphone. Although at present smartphones can’t measure the users’ emotional reaction to
advertising, I think that will happen quite quickly, perhaps too quickly for the advertising industry.
I’m demonstrating, with a very large dataset, just how significant and addictive the smartphone is
becoming for many people. The data I have in this instance is more than enough to justify the
findings I'm making. I've previously written about how we are all getting snared in a continuous
cybernetic feedback loop and, at the risk of labouring the point, it would seem that every year
extraordinary new heights in this area of contemporary human behaviour are being reached.
The figures I'm using to show this come courtesy of Flurry Analytics who have built up a large pool
of data by providing their software free to developers. Impressively their tracking code now
measures usage on over 700,000 mobile apps across 1.8 billion smartphones around the world.
Every year people use their smartphones more and more and, in September this year, Flurry
tracked a significant milestone in the U.S. when the time spent using mobile apps exceeded the
time spent watching TV. Often these two activities go hand in hand, although American TV viewing
has remained constant for the last two years at an average of 168 minutes per day whilst the
average time spent on a mobile phone has now climbed to 198 minutes per day, up from only 126
minutes just two years ago. This is just one measure of a phenomenon that doesn't seem to show
any sign of abating, our relationship with smartphones is becoming ever more intense.
As with any aggregated data it is the distribution that really matters, and diving into the Flurry data
shows that across their worldwide mobile population some users show much greater addictive
behaviour than others. Just over half (53%), or 985 million people, can be classed as Regular Users
who check their smartphone and use an app up to 16 times or less a day. Checking the mobile
phone 16 times a day equates to around once each hour that somebody is awake. Whilst nearly a
third (32%), or 590 million people, check their apps between 16 and 60 times per day and can
therefore be called Super Users, on average checking their mobiles up to four times per hour.
Whilst the remaining 15%, or 280 million, who I will call Mobile Addicts, check their apps more than
60 times a day or more than four times an hour. Amazingly nearly half of the 1.8 billion devices in
which Flurry Analytics is measuring activity are being checked by Super Users and Mobile Addicts
several times within an hour. That’s quite a finding. But remarkably, when we look at the growth in
mobile phone app daily use from 2014, and compare this with 2015, it confirms that the world's
love affair with the smartphone is becoming more and more time consuming. In 2015 Regular
Users grew by 26%, Super Users by 34% and Mobile Addicts by 59%.
The ad agencies may be rubbing their hands in glee at this but the unappreciated fly in the
ointment is that people seriously hate advertising on their smartphone, particularly as they are
often inadvertently using up their precious monthly data allowance to download the advertising.
And this is something else that the vulture capitalists haven't considered, mobile advertising is the
first form of advertising that you pay to receive. Recently The New York Times reported that it had
tested 50 newspaper websites, using a mobile phone, with and without an Ad Blocker. The reason
for the NYT’s article was that it coincided with Apple allowing development of ad blocking
capabilities in iPhones, and an advertising convention hosted in New York at which this novel ad-
blocking was a major conversation topic. The results of the NYT’s tests was that in all but 12 cases
in order to view a page of content, the quantity of data that had to be downloaded for advertising
was considerably greater than that necessary for the content. As mobile networks now make more
money from data than voice traffic, most people are having to pay for the privilege of seeing
advertising that they have no wish to see. On a website like boston.com the New York Times
calculated that just loading the home page would cost a typical data plan user 32 cents. And the
advertising also made the load time for the page over a mobile connection very slow as it took 30.8
seconds to load but only 8.1 seconds using an Ad Blocker. With typical regular usage over a month
without an ad blocker boston.com costs $9.50 just to download the advertising. To add insult to
injury The New York Times also discovered that mobile advertising takes up around 21% of a
smartphone's battery life. As many people just manage to make their battery life last a day, that's
another infuriating inconvenience, and something else the advertising industry hasn’t considered,
yet alone begun to measure.
...with analysis & insight...
Love the mobile, hate the ads