Smart Insights on Smartphones in Canada

Imagine a magical device that allows you to make phone calls, check email, log on to the internet, Tweet about your day, send text messages to your friends, take photos and post them directly to Facebook, check the weather, play games and read the score for your favourite sports teams. Unless you are living in 2005, you really don't need to imagine it. They are here. Smartphones appear to be everywhere and they are changing the way the world functions and behaves.

Ipsos Reid been tracking smartphone penetration and consumer behavior in Canada for several years now, but only recently have the numbers captured our attention. Smartphone penetration in Canada had been tracking upwards at regular, but relatively slow pace over the past five years or so–and only recently did it make a dramatic swing up an exponential curve. In fact, in the past year, two separate studies (our Canadian Interactive Reid Report, and Mobil-ology) have shown a 50% increase in levels of smartphone penetration and usage from this time last year–to 31% of the online adult population.

The impact on consumer behavior in this space on a number of levels is only beginning to be understood–witness the impact of smartphones on the Stanley Cup riots in Vancouver, or the lack of bandwidth telco providers have had to deal with in crowded public spaces (concert halls, outdoor gathering, sporting events), the proliferation of apps, and the more recent disintegration of RIM's stock price.

This sudden increase has come about for a number of reasons–firstly the impact of technological advancements in device functionality as Apple, RIM and Android device manufacturers add an ever increasing array of capabilities to their phones more rapidly than in the past. Secondly, the content providers (websites, media companies and app developers) have significantly upped the ante in terms of what is available for consumers to do and view on their phones. Who would have dreamt that we could watch streaming television directly from our smartphone, conduct our bank transactions or buy stuff only a few short years ago? Increased competition in the wireless arena has created affordability in a nation that has been criticized because of our high wireless rates in the past. And finally, the continued increase use Facebook and other social media (45% now use Facebook at least weekly in Canada) has spawned a whole new demand for pictures and video via smartphones.

The more significant finding though, in my view, is the number from our study that shows consumers are spending an average of 17 hours a week actively using their device–and that for the first time ever–activities like texting, surfing and viewing apps/websites/videos actually surpassed the amount of time that people spend actually talking on their device. At this level, the device is competing closely with the PC or the television for the attention span of consumers, yet expenditures from marketers in mobile is a fraction of what it is for traditional media or online.

These statistics have significant implications for marketers on a number of fronts that have us all playing catch-up. Firstly, marketers need to align their focus to addressing this relatively untested medium and start to allocate significant dollars to this space. Secondly, marketers and web developers have had to adapt to pinpoint marketing and make the full transition not only to one-on-one marketing, but have to invent location-based marketing from scratch. Web and content developers also need to deal with the limited real-estate of a smartphone screen, and determine if they want to invest in the app-route, or make their websites mobile-friendly. Lastly, companies need to understand to what extent are their own consumers using mobile, and understand their openness to things like text messages, mobile contests, co-creation, coupons, location-based alerts, etc.

As a marketer, all of our clients are scrambling to catch up, and most firms admit that they are just beginning to look at this space, which means they are already significantly behind. Our two reports (our Canadian Interactive Reid Report, and Mobil-ology), go a long way towards helping you understand the mobile market, and we'd be happy to work with you to help you customize your approach in this new, exciting marketplace.