RBR asked Gene Keenan his take on iPhone. With nearly 30,000 news stories and an estimated 500 million US in free media generated by it for Apple you would think we would all be tired of hearing about the iPhone but the general public apparently is not. Every time I take my iPhone out a small crowd gathers around me and wants to see it, play with it and… lust after it. Instead of doing a mechanical review of the iPhone (there are hundreds) I would like to focus instead on what this device means to consumers and the wireless industry at large and therefore important to agencies like us.
RBR note: Interesting take on Free me which iPhone unlocks information from time and space – Touch me, feel me, see me adds touch eliminating the input barrier – Hate me – Love it or hate it critics will charge that Apple did not invent the multi-touch screen.
[Interesting Analysis here]
Free me:
The iPhone unlocks information from time and space, specifically the ability to access the full internet. Analysts and industry watchers that have gotten used to using WAP or the mobile web have convinced themselves that consumers don’t want a full web experience, that a text based static experience is enough: They will be proven wrong! The web experience on this device is nothing short of stunning and in many instances this device has supplanted my laptop for surfing the web like lying in bed or sitting on the couch in my house.
To be fair, critics and analysts arrived at the conclusion that consumers don’t want content on their phones or a full web experience because of the apparent failure to date of 3G networks (3rd generation or high speed) in Europe. Once again the critics are wrong in their analysis. The failure of 3G to capture the public’s imagination so far is because of a lack of consumer centric products and services and devices that have interfaces that make accessing those services easy and effortless. The carriers have acted as gate keepers. With this device the consumer is finally in control within the mobile domain.
When you first fire up the safari browser on the iPhone the first thing you will notice is that the AT&T carrier deck is missing ("deck" is a term dreamt up by the wireless industry to mean home page). Gone are the confusing search engines, content silos picked by the carrier and everything else that a carrier believes is what their end consumer needs/wants to see. What’s left is pure unadulterated cyberspace replicating the same experience you have at home or work. I was recently on holiday in Los Angeles with a friend of mine and her family from North Carolina. Car trips with them can be challenging but because of the iPhone they watched You Tube videos and played on the web on the hour plus trip to Laguna Beach and back plus we were able to determine the best way home using the live traffic reporting on Google maps.
Touch me, feel me, see me:
The iPhone brings existing usage metaphors to the phone that we already understand but adds touch eliminating the input barrier that buttons and keypad shortcuts bring to the table. For the first time the mobile phone really feels like an extension of the user. As an example of this familiarity; I was with a friend of mines mom and she was feeling anxious about checking the payment of a bill. I gave her the phone and she was able to with virtually no instruction to navigate to and easily log into the same familiar screen she was used to online.
Hate me:
Highly respected computer electronics reviewer Walt Mossberg from the Walt Street Journal said it best; "People don’t like their cell phones." This is a sad statement too because according to CNW Marketing Research which follows the automotive industry 32% of 16-29 year-olds said a cell phone is more impressive than a new car (new cars have fallen to 20%). In other words we really want to love our cell phones even though we hate them.
The mobile phone industry much like the game console industry has focused on ever more features and faster devices believing that this is what every consumer wanted and many analysts state the iPhone will not be revolutionary because it’s not as technically advanced as other devices. Nintendo disrupted this belief with the Wii. Although the Wii is not the most graphically advanced game console on the market, it is simple, intuitive and makes the underlying technology deceptively simple by bringing to consumers a new metaphor for interacting with a machine using the users own body movements… enter the iPhone: The iPhone is the Wii of mobile phones. There are phones on the market like the Nokia N95, or Sony/Ericsson W900i for example that are far more advanced technically but fall down when it comes to innovative human input and interaction with the device. They are loaded with features but impossible to use and require door stop sized manuals. The iPhone is so intuitive, so simple to use (the manual is 5-6 pages) that the average user can pick it up and have it mastered within an hour and instantaneously make you forget why you hated all your other phones: For the first time Apple has shown us what our cell phones could be. It’s no wonder then that the same CNW study showed that your popularity skyrocketed to 70% if you had possession of an iPhone. Apple has moved the needle in the direction of the consumer.
You say you want a revolution: model upended
For the first time a device manufacturer has dictated to a carrier the terms of the relationship. In the past, handset manufacturers have been at the mercy of the network and in most cases the handset maker knew very little about the end consumer. See point one through three for explanations on what this means to the consumer.
In addition, the traditional activation model for phones has been uprooted from in store to a personalized consumer centric experience via the iTunes application done at home or work.
The iPhone will make other networks work more closely with device manufacturers and dispose of the adversarial relationships that currently exist. Everybody but particularly the consumer will win in this new model.
Love it or hate it:
The iPhone will change not just the mobile phone but computing in general. Critics will charge that Apple did not invent the multi-touch screen in the same way they charge they did not invent the mouse. Industry watcher John Dvorak said in 1984 about the mouse, "There is no evidence that people want to use these things." While it’s true that the mouse came out of the Xerox Parc labs it took Apple to capture the public’s imagination and in the process redefine the entire computer industry. The multi-touch screen will bring about this same change but not just in mobile but with the greater personal computer industry. In a Reuters story dated June 18th, "Nokia Sees Future For Touch Screens, Move Sensors", Nokia does an about face from where they had publicly stated previously which was consumers would not be interested in touch screens.
In March of this year the same John Dvorak said, "Apple should pull the plug on the iPhone…. there is no likelihood that Apple can be successful in a business this competitive." Apple sold 276 thousand cell phones in 30 hours beating its sales goals and besting in that time the launch of any other mobile phone for its first month of release. RBC Capital, an investment bank, which closely follows the mobile market, has since raised Apples sales goal by 35% to 13.5 million units for CYO8.
Prediction:
Apple stock will top $200 within 18 months as market share for the Mac computer continues its aggressive sales growth and the iPhone begins to have a positive impact on their bottom line. In a recent ChangeWave survey 77% of iPhone purchasers were "very satisfied" and 16% of respondents said they would be interested in purchasing the iPhone within the next 6 months.
Turning Japanese prediction:
With a few modifications like a place to add a strap (Japanese love dangling things from their phones) and of course 3G the iPhone will be the first foreign phone to win the hearts of the discriminating Japanese user. Global leaders like Finnish handset maker Nokia have failed to make much of a dent in this market and are generally thought of poorly by the Japanese.
Sell me
There are two tracks for selling to the iPhone:
2) Display advertising: The iPhone subverts the ridiculous sums ($30+CPM) some mobile ad servers are charging because when the consumer surfs the web what they see are the same ads they would see online. If more phones adopt this type of experience and the number of iPhones in circulation starts to hit double digit numbers the challenge for online adservers will be to serve up contextually relevant ads to these users rather than what they would see online. This could conceivably topple the existing mobile ad server model and create more inventory for the likes of DblClick, Atlas, Bluestreak, etc.
1) Beyond the arguments over whether consumers want the real web, the "baby web" or something in between there has been noted turbulence in the ad agency world because the iPhone has no overt way to advertise to it. I see this as a good challenge for the industry and hopefully transformational for the wireless industry as a whole. One that takes advantage of the always on nature of mobile and moves us towards applications and destinations that engage us and extend the fun, consumer-centric, and addictive experience we already have. The brands and agencies do this will have the most right to win.
Be me:
In closing I want to quote US Congressman Edward Markey, (Democrat, Massachusetts) and chair of the Subcommittee on Telecommunications and the Internet. He kicked off their committee meeting by holding up his iPhone and announced its "sheer brilliance and wizardry," and "undoubtedly consumers will cherish this device as though it is a part of their family." I certainly cherish mine.
Gene, Aegis Media’s Isobar Mobile Group CEO, has been working in the digital space for the last 8 years. Gene leads the cutting edge of marketing innovation as Isobar’s VP of Mobile Strategy. In this role, Gene has won numerous Aegis Globe awards for his innovation and has been the recipient of industry awards including an MSNEMMY for his work on Adidas.
Gene represents Isobar as a founding member of the Mobile Marketing Association. The association also counts as board members these major brands: Coca-Cola, P&G, VISA, AOL, CBS, ESPN, FOX, Microsoft, and every tier 1 carrier in the USA. He co-chairs the metrics committee of the Mobile Marketing Association (MMA) and helped guide the first marketing effectiveness study on behalf of the MMA. Gene works on the Adidas, Electronic Arts, Dolby, Reebok, Wachovia, New Line Cinema, and Coca-Cola accounts. He has launched global mobile marketing campaigns on behalf of Reebok, Sprite and Adidas.
Before joining the interactive space Gene was a professional chef who toured with the Grateful Dead for eight years and owned an organic edible flower and herb farm.
