OMG’s latest report on mobile trends in finance highlights extraordinary growth in mobile for the finance, insurance and utilities verticals in the UK. Stephen Rumbelow, OMG’s Commercial Director, outlines some of the key trends, their implications for advertisers and the many exciting opportunities for the future.
Mobile transactions treble; tablets take the lion’s share
In 2013 we’ve seen the overall volume of mobile traffic across our network double, with almost one-third now originating from mobile devices. That compares to just 4% of traffic coming through mobile in 2011. If the implication wasn’t clear before, it certainly is now: mobile is the future.
Transactions through mobile have trebled in 2013, with mobile now accounting for 18% of all transactions, up from 8% in 2012. Tablets drive the most transactions (58%), which we believe is down to several factors. Firstly, since very few finance and insurance advertisers have responsive designs for smartphone, tablet and desktop, it’s generally easier to transact on a tablet than a smartphone. Also, the propensity to convert is typically highest between 7.00pm and 10.00pm and at weekends, when tablets are typically used at home and they also benefit from the ‘second screening’ effect.
For us, it’s clear that mobile marketing offers advertisers a wealth of new and more advanced targeting tactics that can deliver better performance from the same marketing spend. Specific customer segments can be targeted by the type of media they consume, or which type of device they use. Advertisers can target people using Wi-Fi at home during the evening, when we know they’re more likely to convert. Mobile also enables a more integrated approach to marketing. For example, mobile campaigns can be optimised to coincide with TV campaigns, getting more ‘bang for your buck’ from the second-screening effect.
People are deserting desktops for tablets
Both advertisers and publishers risk being taken by surprise at the rate at which consumers are switching from desktops to tablets. Make no mistake: when it comes to researching, comparing and purchasing personal finance, insurance and utilities products, tablets are moving centre stage in the home, while desktops are being side-lined. This year, we’ve seen tablets and smartphones grab almost a third of all traffic, compared to just 11% a year ago.
Give people a reason to go mobile
Finance advertisers have typically been slower to react to mobile compared to their retail and travel counterparts. However, it’s worth noting that while cashback sites only drive 8% of mobile traffic, they drive 27% of all transactions. We feel this shows that even though transacting on a mobile can be a challenge, consumers will persevere with it if you give them the right encouragement.
Advertisers who want to lean less heavily on cashback sites should invest in m-commerce. PPC, content and email publishers drive nearly 80% of all mobile traffic, and most want to invest more in the channel, but low conversion rates are holding them back. Given the chance, they can drive even larger volumes on mobile and help to generate incremental sales and reduce advertisers’ reliance on cashback, especially in instances where Click to Call can be used as an effective call to action to convert mobile traffic into sales.
Different device, different behaviour
To develop an effective mobile strategy, you have to recognise that consumers’ paths to purchase can extend across multiple devices, and that their behaviour differs by device type. Integrating campaigns across desktop, tablets and smartphones means adopting different content strategies, calls to action and optimisation tactics for these different behaviours.
For example, in the insurance vertical, 70% of mobile transactions are on tablet, yet almost 50% of mobile traffic comes via smartphones. We know that smartphones are used out of the home for goal-based research. One way to convert this traffic would be to facilitate quick quotes on smartphones that can be retrieved later on tablets or desktops.
Conversely, within the credit-card vertical, most mobile transactions originate from smartphones (58%). This could be because consumers are quite willing to transact on a smartphone for lower-involvement purchases if the experience is quicker and easier. Alternatively, the growth in sub-prime credit cards may have skewed sales towards the cheapest way for less affluent consumers to access the internet – smartphones.
Growth from low-end tablets
iPhones and iPads still command the bulk of mobile traffic, with a 70% combined share, but we’re now seeing astronomical growth rates in traffic from other devices – 1,000% and 4,000% this year for Android and Windows tablets respectively. Android and Windows devices now account for over a quarter of all mobile visits.
Tablets are no longer the preserve of affluent early adopters. The influx of new low-end models such as Tesco’s Hudl, Google’s Nexus, Amazon’s Kindle Fire and Aldi’s tablet will fuel further growth in mobile traffic as tablets go mass market. This opens up new opportunities to target a broader base of consumer demographics across different tablets.
The average conversion rate from mobile is around 7%, compared to 13% on desktop. That means sales are being lost as advertisers fail to turn mobile traffic into sales. Looking at specific verticals, mobile conversion rates for insurance are 10% on average, compared to 15% on desktop, while mobile conversion rates for utilities are 7% compared to 12% on desktop.
The bottom line is that the explosive growth in mobile traffic is showing no signs of slowing, but advertisers aren’t benefiting from it as much as they should. By investing in m-commerce sites, they can boost conversion rates and optimise their share of sales within the performance-marketing channel.
It’s time to get tactical
There are a host of tactics that can be used alongside m-commerce development to boost conversion rates. For higher-involvement purchases such as mortgages or insurance, pay-per-call is an effective way to convert mobile traffic into qualified sales leads. Lead generation uses mobile-optimised short forms to achieve the same goal.
We’ve also seen that mobile conversion rates for credit cards, bank accounts and pre-paid cards are a lot closer to those achieved on desktop. Credit cards convert at a very respectable 14% on mobile, compared to 17% on desktop, with bank accounts and pre-paid cards converting on mobile at 5% and 7% respectively – exactly the same as on desktop. Publishers are keen to utilise mobile landing pages for mobile search campaigns, with mobile-specific earnings-per-click metrics being used to optimise advertiser placements. This could be an effective tactic for those products that achieve strong conversion rates on mobile.
Mobile is the primary medium
We’re finding that mobile traffic being driven across a broad base of publisher segments – PPC (34%), content (25%), email (18%), price-comparison (12%) and loyalty/incentives (8%). We know cashback and voucher code sites typically have more advanced mobile strategies – such as responsive design and apps – but other publisher segments are driving more mobile visits, even in the absence of such strategies. This supports our view that mobile is rapidly becoming the primary medium used by consumers.
Use mobile to grow market share
Performance marketing is a mature digital channel, often characterised by downward pressure on commissions coupled with upward pressure on incremental sales. And we believe mobile is a big part of the answer to that challenge.
With a third of all traffic now coming through mobile, and almost one-fifth of all transactions completed through the channel, the time has come for advertisers to invest in mobile if they want to maintain and grow their market share. If they don’t, we believe they’ll see sales decline as traffic migrates from desktop to mobile. Without a doubt, finance, insurance and utilities are extremely competitive environments – but the advertisers who invest in m-commerce are the ones who will win the race.
The full OMG Mobile Trends report can be downloaded from OMG’s website, http://www.omgpm.com/mobile-trends/