GFK - LBS Consumer Market Research

GfK Custom Research North America Metaplaces Conference September 23, 2009

Metaplaces Conference
Identifying Key Drivers and Measuring Consumer Preferences for LBS

© Copyright GfK Custom Research North America 2009. Proprietary and Confidential


Navigating the LBS market
2

Consumer Best
Challenges Drivers
Landscape Practices



3

Consumer Best
Challenges Drivers
Landscape Practices

Connectivity

Attitudes

Behavior



Consumers’ increasing connectivity is a good launch
pad for LBS
Connectivity
4
Smartphone adoption rapidly increasing,
moving beyond productivity apps
Year-Over-Year Shipment Growth in USA*

2008 2009 2010

Smartphone +68.4% +7.9% +28.4%

Traditional Mobile -13.8% -20.3% -1.2%
(Projected)
Total Market -4.7% -14.8% 6.1%
*IDC.com

Netbooks and mobile broadband
making significant inroads
Netbook Shipments Worldwide*
139M

MiFi Introductions
32.7M hit the market in
2009
16.4M

2008 2009 2013* (Projected)

*ABI research.com


4 consumer trends that LBS marketers can tap into
Attitudes
and
Behavior 5

1 Practicality

2 Accessibility

3 Sharing/getting personal

4 Protecting the family



The practicality and accessibility of Technology
Attitudes
and
Behavior 6

• Consumers are increasingly showing their practical side
when it comes to technology, and wireless offers
productivity “on the go.”
• Accessibility is a key need sought by the increasingly
mobile consumer.

% of American adults 15+ who agree with the following
statements related to technology*

To me it is important to 48 2008
always be reachable 2009
wherever I am 52

I buy technology products 25
that help me do things I
need to do 34

*GfK Roper Reports Worldwide 2009



Sharing and getting personal is another key
underlying need Attitudes
and
Behavior 7

Consumers using their mobile phone or netbook
to share content on social networking sites,
online photo albums, blog sites, and community
video sites:*
Social Online Web Community
Networking Site Photo Albums Blog Sites Video Sites

Desktop PC 63 64 49 63

Laptop 45 35 41 36

Netbook 9 10 16 10

Mobile Phone 17 9 14 10

Portable Media
5 5 15 8
Player

*GfK Connected Life



Protecting the family is #1 value of 32 tested
Attitudes
and
Behavior 8

... Top 16 attributes shown

Protecting the family 84% Self reliance 71%

Freedom 79% Friendship 70%
Stable personal relationships 79% Equality 63%
Authenticity 78% Helpfulness 62%

Working hard 74% Open-mindedness 61%
Enjoying life 72% Respecting ancestors 59%
Learning 72% Social tolerance 59%

Knowledge 71% Having fun 58%

*GfK Roper Reports US



9

Consumer Best
Challenges Drivers
Landscape Practices

Connectivity Monetization

Maximizing User
Attitudes
Experience

Behavior Privacy



With the proliferation of free applications, requiring
consumers to pay will be a challenge
Monetization
10

*Key monetization challenges across LBS apps tested . . .

• Changing plans

• Paying for individual services “There are some nice features,
but I really expected more for
• Changing carriers “Compass is
$10. I own less expensive
apps that I’ve found to be
influenced by nearby much better.”**
electronic devices to such a
degree that it is quite
“Just downloaded and installed this inaccurate. Only .99 cents but
app today thinking I’d save a few bucks I wish I had spent more on
versus Navigon, TomTom, etc You something that was
should absolutely save your money accurate.”**
and buy something – anything – else.
This is worthless for the purpose of
navigation. I will never use it again,
and if I could get my money back, I
would...in an instant.”**

*GfK Tech Test
**iTunes Apps Store Reviews



Mobile advertising has yet to reach wide acceptance
LBS can be a solution to increase relevance Monetization

11
Find:
Ads on mobile phones annoying 70

Ads on TV annoying 37

Ads on social networking sites annoying 29

Find:
Ads on mobile phones acceptable 5

Ads on TV acceptable 42

Ads on social networking sites acceptable 23

Mobile ads are yet to deliver value to the consumer

Describe mobile device ads as informative 9

Describe mobile device ads as useful 14

*GfK Roper Reports Worldwide 2009


Increase adoption by addressing key challenges
Maximize
User
Experience 12

Learning Curve
If I am going to be able to use a
25 % Agree
new technology product,
somebody has to show me how 2008
32 2009
to use it*

“Themes of recent CTIA and International CES trade shows has
been how new handhelds are often shipped with so many new
features and functions that users hardly ever use 10% of all
features, or even learn how to use them.”**
Screen Size
“Phones are so small that “You won’t be able to
easily reading maps on them see the screen. It’s too
is hard to do.” little.”
~ GfK Tech Test ~ GfK Tech Test

Security of Personal Information
In an effort to protect user privacy: “Google’s Latitude does not
keep a historic log of a user’s location; it overwrites data each
*Roper Reports Worldwide 2009
time the user reports a new location.”*** **www.macworld.com
***www.eff.org


LBS benefits must outweigh privacy concerns
Privacy
13

Possible Benefits Privacy Concerns

“I do not like the idea of the
Safety possibility that someone would
know your every movement during
the time your phone was in use.
Privacy is more important than
Convenience having an exact pinpoint location
given to me by a tracking satellite.”
~ GfK Tech Test
Accessibility
“The concept of Big
Sharing Brother watching me.”
~GfK Tech Test



14

Consumer Best
Challenges Drivers
Landscape Practices

Connectivity Monetization Problem Solving

Maximizing User Enhance
Attitudes
Experience Experiences

Behavior Privacy Relevance



Ability to solve a problem is the top driver of Appeal
Problem
Solving 15

DRIVERS*

A Ability to solve a problem 59%

B Uniqueness 18%
Overall
Appeal
C Ease-of-set-up 14%

D Believability 9%

*GfK Tech Test



Successful LBS applications must
Enhance
Experience 16

Fulfill an existing need OR Enhance current experience

GPS Smartphone Shipments Worldwide*
% who have accessed the
Internet in past 3 months for 77M
maps/directions**
+34%
76 %

57M

2008 2009

Opportunity to drive consumers to their
mobile device
*electronicsnews.com
**GfK Connected Life



Keep it relevant Relevance

17

What Where
Top iPhone Apps Where Mobile Devices are used
• Bathroom/Rest Area finder At home 66%
• Friend mapper (shows friends' current location) In the car 50%
• GPS Outside 46%
• Hotel finder (finds hotels with open rooms close
to current location) At work 43%
• Local restaurant locators Somebody else’s home 39%
• Restaurant openings/reservations At café/restaurant 37%
• Local services and amenities (restaurants, bars,
gas stations, tourist attractions) While walking 37%

• Parking lots and rates At airport/train station 33%
• Post location on Facebook On public transport 29%
• Registered offenders (brings up offender lists
from current location) At client/customer offices 19%
• Speedometer At school/college/university 15%
• Weather channel (local weather based on current
*GfK Connected Life
location)


18

Consumer Best
Challenges Drivers
Landscape Practices

Connectivity Monetization Problem Solving Methodologies

Maximizing User Enhance Metrics to
Attitudes
Experience Experiences Evaluate

Activating Your
Behavior Privacy Relevance
LBS Strategy



Do I have a winner?
Methodologies

19

Explore Quantify
Online Diary Survey questionnaire

• Benchmark against other apps
• Profile potential users
• Uncover benefits and concerns • Assess uniqueness of app and
• Evaluate use cases problem solving

• Get ongoing feedback



Stand out and solve problems Metrics for
Evaluation
20
Aim for upper right quadrant

35
Old Answer to New Answer
Problem to Problem

30
Mobile E-mail
% Solves A Problem

Mobile Payment
Mobile Maps
25

Normative
Mobile Photo Average
20 Mobile Files
Sharing
Mobile IM Mobile TV
Train/Flight Booking/Information
15

No Problem/ Mobile Video Time Shifted TV New Answer
No Answer Mobile Entertainment to Non-Problem
10
10 15 20 25 30 35 40 45 50 55 60 65

% Extremely/Very New and Different



Activating your LBS strategy
21

Appeal to underlying consumer needs
• Practicality
• Accessibility
• Sharing/getting personal

Focus on delivering value in mobile ads
• Leverage LBS technology to enhance relevance

Address user experience barriers

Keep it relevant to where and how consumers
want to use their mobile device

Explore and quantify

Leverage Convergence

GFK - LBS Consumer Market Research

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