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The Truth About the Mobile Reader

Posted on Tuesday, October 25, 2011 at 1:34 PM

The truth is that the truth is elusive.

By William Dunkerley

In early October we attended a Texterity-sponsored webinar about mobile readers. The presentation, which presented the results of a Texterity survey from earlier this year, had a very positive vibe. We learned that app downloads tracked in the survey were, by platform, 61 percent tablet, 35 percent smartphone, and 4 percent iPod.

But for me, the rest of the survey raised a number of questions. My quick analysis of the survey results yielded conclusions much less rosy than the tone of the survey presentation.

Paid Mobile Content Advertising

For starters, paid mobile content that contains advertising seems to be a real non-starter.

How did I come to that conclusion? The survey said that one third of mobile readers gladly accept advertising as a tradeoff for free content. That means two thirds aren't interested in content that has advertising, even if the content is free thanks to the ads! Now think about what this means for paid content that contains advertising. If the readers don't want to be exposed to advertising even if they get free content in exchange, why would they want ads if they're paying for the content? It would have been interesting - and strategically important - if the survey had delved into that. But it didn't. So we're left to make inferences from the data.

But this finding seems to be a real impediment to the development of a successful business model for publishers. Who's going to make enough money just by selling apps to pay for the development of original content?

An on-the-fly survey of webinar participants indicated that only 9 percent are using a paid content model. Three percent have a combo of paid content and advertising.

But even if readers eventually accept the ads, there doesn't seem to be a clear and logical reason for advertisers to want to spend much to reach them. The survey indicates that only 7 percent of internet traffic comes from mobile devices.

That doesn't seem to faze the representative from Entrepreneur magazine (a Texterity customer), Mark Tavarozzi, who was one of the webinar presenters. He noted that some advertisers have dedicated budgets for mobile apps and that his magazine is interested in going after that money. He indicated that his magazine still produces a traditional digital replica, and there is not a lot of consumer interest in it. According to him, it was always small and it's still small.

About five years ago, digital replicas were being hyped to publishers by vendors in much the same way that mobile apps are being hyped today.

Tavorozzi indicated that his magazine is covering their mobile costs from advertising. But if that's just the incremental cost for producing the mobile app, that's not saying much. That's not contributing anything toward development of the content. It would have been useful to know just what costs he's talking about covering.

Interactive Ads

My analysis of the survey results also yielded surprising findings about interactive advertising.

The survey reported that 15 percent of readers "enjoy ads with interactive media." What about the other 85 percent? Are they merely disinterested in the interactive media? Or are some of them annoyed? It would be useful to know that. A paltry 15 percent approval rating doesn't many publishers a very compelling reason to sell such ads to their advertisers.

A stronger number, 66 percent, represents the share of readers who actually act on advertising. That action, however, might be just a click. This wasn't particularly well defined in the presentation. Forty percent of readers report actually making a purchase, but that's not necessarily a result of the app exposure. Those purchases may have been made at a store, through a catalog, or via a website. So, the headline was "66 percent Act on Advertising." But when you get down to the fine print, it seems that those actions may have had absolutely no direct connection with the app.

Another tricky revelation is that 4 out of 5 share content. That gives many of us the impression that someone pushed a "share" button or forwarded something via email. But when you read the fine print, you find that the sharing may simply have been by word of mouth. So if one person passes another in the hall and says "Did you see the [xyz] article," that's a share, I guess. What good is that going to do an advertiser? Back in the print era, magazines estimated pass-along readership at around 4 per copy. That's something that advertisers can understand and appreciate.

You can obtain the entire Texterity survey report at www.texterity.com/survey. Be on guard, however, if you decide to read it. It doesn't seem to present a very balanced picture, nor does it give publishers the kind of strategic information needed to devise an effective mobile business plan.

Without question, most publishers should be capitalizing on the growing demand for mobile device content. However, it is still less clear than many vendors would have you believe exactly what direction we should be take. AdAge magazine recently cited a study of what Android apps are most popular: Google Maps, Gmail, Facebook, and Google search, all used by about 75 percent of users. Next at around 50 percent is YouTube. Everything else is 26 percent or below. Magazine apps seem to be down in the noise. They weren't mentioned in the AdAge report.

William Dunkerley is principal of William Dunkerley Publishing Consultants, www.publishinghelp.com.

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