With Internet usage shifting from desktop to mobile, Yahoo needed to get ahead of this trend, understand who was driving it, why, how fast it was occurring, and what advice to give digital marketers as a result. To answer these questions, Vital Findings used in-depth interviews, device tracking, and quantitative research in the US, UK, France, and Germany. Presented at THINK LA, INTERACT, the Razorfish Global Tech Summit, and showcased on Yahoo’s online advertiser resource center globally.

1. SMARTPHONE
DOMINANCE
T H E S H I F T T O

2. 2
W H A T ’ S C O V E R E D
Rapid Adoption:
What are the drivers
impacting the pace of
smartphone ownership?
Factors expediting
the shift:
How should advertisers and
publishers be building for a
mobile majority first world?
Thinking Beyond
Ownership:
Now the majority of
consumers own a
smartphone, but so what?
The purpose of this study is to understand mobile migration patterns and which factors will
accelerate the shift to a mobile-first world for consumers and advertisers.
Background

4. RAPID ADOPTION PATTERNS
H O W S M A R T P H O N E S A R E D I F F E R E N T
4

5. ADOPTION CURVES FOR MODERN CONVENIENCES
100
50
1900 1915 1930 1945 1960 1975 1990 2005
The adoption curve for modern conveniences
has shortened considerably
Adoption curves since 1900
Source: Visual Economics
TELEPHONE
ELECTRICITY
AUTO RADIO
STOVE
CLOTHES DRYER
MICROWAVE
DISHWASHER
COLOR TV
CELL PHONE
INTERNET
VCR
FRIDGE
CLOTHES WASHER
AIR CONDITIONING
COMPUTER
5

6. 2012 2013 2014 2015 2016 2017 2018
Smartphone ownership will reach majority ownership rates in
the next 3 years
6 Source: eMarketer | 2015
UKUSA GermanyFrance
73.6%
69.1%
66.9%
64.9%
50% ADOPTION
Adoption Rate

7. The speed of smartphone adoption can be
attributed to the multiple products it has replaced
7 Source: eMarketer Report / Press Play: Infographic by Nicolas Rapp / Source: Appliance, Sept Issue, multiple years
REPLACEMENT CYCLES FOR ELECTRONICS PRODUCTS
PRODUCT AVG. LIFE (YEARS)
Cordless telephone 8
Color TV 8
CD Player 6
Telephone answering machine 6
VCR 5
Camcorder 5
Fax 4
PC 2
Mobile Phones 1
REPLACEMENT TIME

8. Beyond Ownership
W H O I S D R I V I N G S M A R T P H O N E D O M I N A N C E ?
8

9. What does a
Smartphone Dominant
consumer look like?
9
MOBILE FIRST.
67% state that their smartphone replaces their PC, and
is the main way they access the internet
MOBILE LEAD.
75% of their digital time is on a mobile device
+50% vs. an average smartphone owner
MOBILE IMMERSED.
+50% more activities performed on a mobile devices vs.
an average smartphone owner
Users who spend most of their time on their
smartphones and are using them to replace their PC

10. Nearly 1/5 of users are Smartphone Dominant
10
SMARTPHONE DOMINANT
18% TODAY

11. Smartphone Dominant
users also dominate
sessions and time spent
on mobile devices
11
21%
87%
78%
30%
11%
19%
49%
2% 3%
DEVICES SESSIONS TIME SPENT
Medium
Light
Heavy: Smart Phone
Dominant
DEVICE USAGE
Source: Flurry by Yahoo Analytics, mapped devices only, Jan 2015
Dominant Indeed

12. Currently Smartphone Dominants tend to be female Millennials
and parents…
Proportion of subgroups that are Smartphone Dominant
12
FEMALES'W/'CHILDREN'
'18234'
37%$
FEMALES''
18234'
29%$
MALES''
18234'
21%$FEMALES''
35264'
16%$
MALES''
35264'
11%$
18-3435-64Age Groups │
SMARTPHONE'DOMINANT$ 50%$0%$
In the US only,
Hispanics
38%

13. …due to the smartphone being tuned to the active lifestyle of
parents with young kids
13
AGREE STATEMENTS TOTAL WOMEN 18-34 PARENTS 0-6
I'm using multiple devices at the same time more often than I
did in the past
51% 62% 61%
My smartphone is the main way I access the internet, and I only
use my computer to fill in the gaps with the things that aren't
easy to do on my smartphone
28% 40% 42%
I often start things on my computer but move to my smartphone
because I need to continue the activity on the go
28% 33% 37%

14. 14
SMARTPHONE DOMINANT
67% IN TOTAL
33% NOT LIKELY TO BE
Future of Smartphone Dominants
The vast majority of users will eventually become Smartphone Dominant

15. 15
Developing for larger
screens
Creating experiences
for cross-screen, not
mobile only
Adapting to trends in
the app revolution
Factors that will expedite the shift
to a Smartphone Dominant world

16. More efficient, better user experiences will accelerate the shift
to Smartphone Dominance
Factors that are holding back consumers from being Smartphone Dominant among future Smartphone
Dominant users
16
UX
(easier to type, read, easier
to browse/compare)
67%
Data & Internet
Improvements
54%
Better Apps
44%

17. FULL-SIZE TABLETS
9.74 MIN
As screen sizes grow, engagement will increase
17
SMALL TABLETS
6.88 MIN
MEDIUM PHONES
4.18 MIN
SMALL PHONES
3.8 MIN
Average time spent per session | Minutes
Source: Flurry by Yahoo Analytics, mapped devices only, Jan 2015

18. Developing for larger
screens
Creating experiences
for cross-screen, not
mobile only
Adapting to trends in
the app revolution
Factors that will expedite the shift
to a mobile lead world
18

19. Smartphone Dominant users are more digitally active across
PC and Mobile
# of different activities done last day used
19
SMARTPHONE DOMINANT USERS
# OF ACTIVITIES DONE ON DEVICE CURRENT SD FUTURE SD
Smartphone 16 11
Computer 11 14
TOTAL 27 25

20. Smartphone Dominant users want digital experiences to go
across devices
% smartphone users agree
20 D4_12. How much do you agree or disagree with the following statements about devices? / Smartphone Dominant In Future (n=2913)
“I'm using multiple devices
at the same time more
often than I did in the past”
51% TOTAL
66% CURRENT SD
56% FUTURE SD

21. In fact, 2 in 5 smartphone owners go across devices daily to
continue the same digital activity
In the past day, I continued a digital experience across the following devices
21
42%
28%
23%
16%
15%
14%
DEVICE TO DEVICE – CURRENT SMARTPHONE DOMINANT USERS
Smartphone to Computer
Computer to Smartphone
Smartphone to Tablet
Tablet to Computer
Computer to Tablet
Tablet to Smartphone
42%
Will go across devices on at least
one digital activity
(Among total smartphone users)

22. Communication, content & search related activities span
across devices most
Sequential experience activities for any device – mobile, tablet & PC
among those who had a sequential activity
22
PHOTOS
29%
ONLINE VIDEO
35%
SOCIAL NETWORK
44%
EMAIL
59%
SEARCH
42%
CONTENT
48%
OTHER MENTIONS
Banking 29%
Shopping 29%
Playing games 28%
Streaming music/radio 26%
Using an IM or a texting app 26%
Work/school 20%
Finding directions/using GPS 20%

23. % smartphone dominant users agree
23 D4_12. How much do you agree or disagree with the following statements about devices? / Smartphone Dominant In Future (n=2913)
“I wish the tasks that I
started on one device could
transfer more easily to
another device”
43% TOTAL
57% CURRENT SD
51% FUTURE SD
Despite high crossover, sequential experiences are not
smooth, especially among the Smartphone Dominant

24. 24
Consumers will transfer across devices differently based on
content, social, & utility experiences
Device switches done In last day used by specific activities
! Email
! Search
! Shopping
! Games
! Short-form Video
! Content
! Photo’s
! GPS
! Streaming Music
! Long-form Video
! Work Activities
! School Activities
■ Social Networking ■ Texting ■ Banking

25. Developing for larger
screens
Creating experiences
for cross-screen, not
mobile only
Adapting to trends in
the app revolution
Factors that will expedite the shift
to a mobile lead world
25

26. Saw an ad
about it
39%
I need it for a
specific task
53%
Task-based apps and replacing an existing app are top
reasons users download new apps
Replace an
existing app
49%
Read
about in
an article
39%
Friend told
me about it
41%
How did you hear about these apps
| Among Actively Downloading
Motivations to download apps
| Among Total
26

27. App replacement is done by ~1/2 of Smartphone Dominant
users each week
I’m replacing apps currently on my device
27
A FEW TIMES A WEEK OR MORE
TOTAL 34%
CURRENT SD 44%
FUTURE SD 43%
AT LEAST ONCE A MONTH
TOTAL 52%
CURRENT SD 64%
FUTURE SD 62%
Notable
Quotable
“I am searching for apps
that might replace some
of the apps I currently
have on my phone…”

28. Growth in sessions is driven by lifestyle, productivity and
messaging apps
Changes in annual growth in app usage | Sessions
28
74%
48%
32% 28%
171%
116%
100%
88% 87%
LIFESTYLE &
SHOPPING
AVERAGE 76%
UTILITIES &
PRODUCTIVITY
MESSAGING HEALTH &
FITNESS
TRAVEL SPORTS NEWS &
MAGAZINES
MUSIC, MEDIA &
ENTERTAINMENT
GAMES
Source: Flurry by Yahoo Analytics, mapped devices only, Jan 2014-2015

29. However, what will move media experiences even further is
phablet ownership
29
30%
53%
29%
158%
144%
130%
SPORTS NEWS & MAGAZINES MUSIC, MEDIA & ENTERTAINMENT
PhabletsAll device types% growth in category usage % over index
427% 172%
255%
Source: Flurry by Yahoo Analytics, mapped devices only, Jan 2014-2015

30. Engage future Smartphone Dominant users around life
management & immersive content experiences
Smartphone activities done last day
30
CURRENT SD FUTURE SD % GAP | CURRENT VS. FUTURE
Banking 33% 17%
Shopping 21% 11%
Online video 32% 19%
Streaming music 31% 19%
Social networking 66% 41%
Photos 34% 22%
Search 50% 33%
Emailing 64% 46%
IM or text 47% 34%
Directions & mapping 23% 17%
Playing games 37% 28%
Reading digital content 49% 38%
94%
91%
68%
63%
61%
55%
52%
39%
38%
35%
32%
29%

31. 31
FINDINGS
WE ARE JUST AT THE BEGINNING.
In the next 5 years, 71% of Future Smartphone Dominant users will migrate and make mobile first
This group will expand throughout the next 5 years to include all demographics, not just the early adaptors: Millennials,
parents with young kids or Hispanics
DEVELOPING EXPERIENCES
FOR LARGER SCREENS.
Bigger screens sizes drive mobile
engagement. They also offer
opportunity for more viewable &
engaging experiences to develop
around
IMPROVING CROSS DEVICE
EXPERIENCES.
Communications, content, and
search the biggest opportunities as
2/5 of all smartphone owners already
attempt to port experiences across
multiple devices
ADAPTING TO TRENDS
IN THE APP REVOLUTION.
Apps are where digital time is spent
& app replacement is what is driving
app downloads. Developers of
experiences need to think about
iteration, innovation and marketing to
drive trial

32. 32
IMPLICATIONS
MORE SPACE.
When building a mobile strategy, companies should account for the rapid adoption of larger phablet
devices. More space = more ways to connect with your user. Native ad formats account for this size
naturally and beautifully
INTEGRATED MOBILE BUDGETS.
Mobile ad budgets should not be thought in isolation. With 2 in 5 consumers crossing devices daily, siloed
mobile budget should evolve to larger cross-device buys. Native advertising, specifically, which runs on
responsive design is a must-buy that creates that efficiency and ease for marketers
CONSTANT ITERATION & INNOVATION.
In order to be a major player in the app game, the messaging to drive your app trial must evolve as
consumers are constantly replacing apps. Message what’s innovative & better, not what’s necessarily new
GET THE WORD OUT.
In order to drive app downloads and app adoption, developers & companies need to have a multi-pronged
marketing strategy that uses paid advertising, creates opportunities through content marketing through
articles, and ultimately drives WOM