There are certain mysteries in life which are ineffable…like where do all those solo socks go? why do I always end up picking up the tab? in the weird world of online there are several gaps which remain mysterious. Here’s a couple:
Tablets are divided between iPads (25%) and Androids (74%) with the Surface coming in a distant last at about 1%. The androids out number Apple because hundreds of companies make tablets with the Android OS on board whereas only Apple makes the iPad. What’s weird and (I have never seen a satisfactory explanation for this) is that the bandwidth usage of all kinds is dominated by iPad at about 75% with Android taking the rest. Given that all devices hook up to Wifi how is it possible that 25% of the users are consuming 75% of Tablet bandwidth. There are multiple theories out there…maybe iPads are favored by data intensive corporate applications of the devices, others suggest that the dominance of iTunes in movie streaming is a factor…but then Netflix runs on both….any way you look at it, it’s a bit weird.
The other gap which is causing waves in our industry is the search revenue per click conundrum. Most people are reasonably familiar with the concept that when we click on ads in search results somebody (mostly Google) gets paid. As end users have migrated to mobile devices at a rate far greater than anyone could have ever imagined the advertisers haven’t. Advertising agencies are notoriously conservative and (some might claim) in some ways dumb. Search delivered on desktops has been around for over a decade and they are comfortable with that medium. A few years back social media exploded on the market and agencies were caught completely off guard. A few years later they are just about starting to catch up with the opportunity. Mobile devices and delivering ads against those devices has left the industry scratching their heads…even now I am shocked and infuriated by major brands who still don’t have a mobile friendly site…let alone mobile friendly ad campaigns. The result is that although Google’s revenue continues to head north at a good clip they are achieving that growth with many more cheaper clicks. That steady decline has been happening over the last couple of years with no end in sight. In public statements Google has pinned their hopes on local advertisers paying a premium for mobile clicks to drive their local businesses. We are certainly seeing some pretty dramatic spikes in click prices for “hyperlocal” searches like “plumber West Oshkosh.” The problem is that even large numbers of local businesses smart enough to bid online (but often not smart enough to get good ROI for their efforts) don’t compare to the massive spend the big brands can move between platforms. This will no doubt level out over time….but it’s not going to happen overnight.