“The most anticipated report in Sillicon Valley.”
“Christmas for data nerds.”
These are some of the ways the media introduce Mary Meeker’s Internet Trends report. The popular venture capital consultant does an annual slide deck that’s chock full of data points and constructs a narrative of where the digital world is headed.
The first edition came in 1995 – it had a section on “how to use the internet” and touted the possibility to publish music and television online. We’ve come a long way since then. A quarter of a century later, we know digital technology shapes the economy, impacts basic human freedoms, and changes the trust in governments and companies alike.
The 2019 report spans 333 slides and only a mad(
Here are 7 key points worth mentioning. The numbers in brackets refer to the slide numbers of the respective data points.
We’re running out of fresh audiences online – and it’s high time you focus on mobile and owned channels
We’ve finally passed an important threshold – more than half of the world is now online. 51% of the world’s population (3.8 billion people) used the internet last year. The growth is slowing down, though – it was just 6% in 2018. It seems everyone who wants to be online already is and new users are harder to come by (7). This trend can be paired with the fact that smartphone sales are declining (8) – and that’s the primary internet device for many people across the globe.
People are spending more and more time online – for US users, the total daily time has reached 6.3 hours, up by 7% compared to last year (41). This is mostly due to mobile time online increasing – we’re spending less time on desktop, so we’re consuming a lot of media on the go.
We can be quick to say that we’re moving into an apocalyptic reality where everyone is glued to their handheld devices, but the truth is people are more concerned than ever. More than a quarter of US adults feel they are “almost constantly online” and 63% of adults say they are trying to limit their personal smartphone use (162).
This is probably the reason why we’re registering the first year where social media usage stayed practically flat. There was just a 1% increase year-over-year in time spent on social (164).
What this means for marketers
It seems the easy audience expansion online is done – we can’t hope for more readers just because there are more people on the internet. This means we need to double down on quality content and efficient ad spend. And when users are trying to limit their time online, we need to make sure we’re bringing enough value to make their time spent on our content worth their while.
As people move away from
Finally, if people distrust social media and want to spend less time on these platforms, we might be seeing a cool new opportunity. This could translate to people being more open to get their online content from owned channels like a brand’s blog or newsletter. So invest in your owned media.
As digital growth slows down, efficiency will become key
Internet ad spend continues to grow, with 22% growth YoY, roughly the same as last year (23). This is due to spending on mobile ads which is rising rapidly. Truth is, there’s no other way about it – desktop inventory is getting more limited the fewer hours people spend on their computers.
As competition gets fiercer, customer acquisition costs are rising, too (28). These can often surpass the lifetime value of a customer which makes the increasing CAC unsustainable. It’s an issue especially in highly competitive tech sectors – you know, where all the hip new startups with venture money are.
What this means for marketers
As ad spend is increasing and time spent online stays flat, ad competition is getting stronger. The use of detailed targeting and fresh creative to cut through the noise will be even more important – a pretty banner no longer does it.
Marketers’ key helpers in this will actually be the ad platforms themselves. They are investing in new tech solutions to keep advertising efficient and advertisers happy. Some examples include commerce integration like Pinterest’s shoppable catalogs and hyper-relevant targeting like Twitter’s promoted tweets (27).
So keep experimenting with fresh formats and look for new ways to advertise.
The increase in CAC urges companies to find new more efficient ways to acquire customers in order to get costs back down. Meeker suggests this can be done with trials and free tiers, but, as we’ll see below, it all hinges on how efficiently the brand is in converting these free users to paying customers. Another answer can be acquisition through content – bringing enough value to cut through the clutter and earn engaged visitors.
People are highly concerned with privacy – you’ll need to get permission from audiences by providing value
A year after GDPR came into effect, we see new pushes for privacy – both from national governments and from companies like Apple, Facebook (37), and Google (167).
Users’ concerns manifest in the form of changing behaviors – VPN usage, encryption, and
What this means for marketers
First off, let’s be straight with users and really explain what we’re using their data for. It’s not just a matter of compliance but of basic human decency.
As people start using the internet in more private ways, following them arround through remarketing and retargeting will no longer be as efficient. The play here is to really obtain permission from users by giving them something of value. If your content is good enough, they will gladly sign up for your newsletter and you won’t have to rely on shady pre-checked boxes.
Users are still willing to share data if this improves their experiences
An interesting contrast to the above trend is the fact that most users would gladly share data if this increases their satisfaction. 83% are willing to passively share and 74% are even willing to actively share data with brands in exchange for personalized experiences (148).
What this means for marketers
This proves that people don’t choose privacy for privacy’s sake. They are reluctant to share data if they don’t see the benefit. You can still get information if you’re providing greater value.
There’s a huge section in Meeker’s report with examples of brands using data to improve their products and the customer experience (133-145). But this means you need to look beyond highly-targeted ads and really give users a better, faster, or more appealing experience in return.
The most effective way to convince users is to let them try your product
Increased competition, a fiercer battle for an audience that isn’t growing as fast as the market is expanding. What’s the right way forward?
The answer, according to Mary Meeker’s report could be free trials and free tiers. According to 42% of users, free trials and free tiers are the most compelling reason for trying a new online streaming service (31).
However, running a freemium model is a dangerous game as you need to keep in mind infrastructure costs and you need to find a viable replicable way to upgrade users. We see companies are achieving the latter with varying degrees of success. While one-third of Slack’s users are paying customers, Dropbox gets money from less than 3% of their users (108).
What this means for marketers
Even if your product doesn’t lend itself to a freemium model, the key here is to shorten the customer’s journey to the “Aha”-moment – when they discover your product’s value. Are there unnecessary steps involved? Analyze user paths and make sure you optimize wherever possible.
Additionally, a viable acquisition strategy can be recommendations – no matter if they come from close ones or from other internet users. 23% of customers try a new product because it was recommended by someone (34). The data covers subscription box products, but other physical goods wouldn’t be far off.
The challenge then becomes how to engage users and motivate them enough to recommend you. Providing a remarkable product or service, presenting incentives and making it easier for users to leave reviews are part of the
Audiences look for more visual content, images and short-form video is where the content game is at
Internet users have broadly migrated away from text and still images. They are now focusing on videos and favoring mobile-friendly content like stories formats. This trend influences where users are spending their time online, with YouTube and Instagram gaining the most ground (47).
Images are increasingly the means by which people communicate. This is partly due to the fact that humanity has always favored visuals – text was a “hack” that lets us present information in lower fidelity formats like books, newspapers and more. But nowadays technology developments like faster wifi and better phone cameras have encouraged a surge in image taking (76).
This is a trend seen in text-only formats like Twitter – more than 50% of Twitter impressions now involve posts with images, video or other media (78).
There is also the fact that image usage is continuing to evolve thanks to new tech like augmented reality and AI-powered image recognition (81).
What this means for marketers
The writing – no, painting! – on the wall is clear. Content needs to be more visual and mobile-ready. Try your hands at video production and image creation. Make sure you add visual components to written content – like photos, charts, or infographics.
Brands now live in a world with more accountability where rapid actions are the norm
A huge section of the report goes over the societal and political implications of the open and global internet. While these are hugely interesting, I don’t feel I have the capacity to comment on them.
Two things, however, made an impression in a marketing context. They are the increased accountability that brands need to show and the speed of action they need to take in order to satisfy today’s audience. They align with the topic of brand purpose I recently wrote about here.
A quote by Airbnb mentioned that 70% of users are leaving reviews on the platform (196). This creates accountability for hosts and for the Airbnb platform itself. As users become more active and demanding, we need to keep in mind reviews will keep coming in. And we need to take action.
As people are more active, brands need to be quicker in their reactions to public concerns. There are three examples (199) given in the report:
- Starbucks updated their security policy in 2 days after an incident in a store with two black people.
- Glossier updated its packaging choices in 1 day after a complaint about excessive plastic used.
- Under Armour added new shoe sizes of their Steph Curry model in less than 1 week after a letter from a girl.
The speed of these brand reactions is something we didn’t think possible – or needed – a couple of years ago. But rapid communication online means we need rapid brand reactions, too.
What this means for marketers
First off, you need to make sure you’ve built a reliable system for social listening and you engage in public discussions. Second, you need to make sure your team is capable of taking quick and bold decisions. As nearly real-time communication is the norm now, consumers won’t wait 3 days for a brand statement – they expect you to take action right away.
Find your own marketing insights
As I said at the start, these are only some of the cool data points in Meeker’s report. So don’t take my word for it – go through the full slide deck and you will definitely find other trends worth mentioning. The span of it is only one of the reasons why it’s among the reports I think all marketers should follow every year.
“Brands now live in a world with more accountability where rapid actions are the norm” – what I read here is: Finding a quick fix to customer complaints is an effective (yet sometimes costly) marketing strategy. However, this does not only increase overall customer satisfaction, it brings brand trust to a whole new level. To fully utilize this strategy, companies must publicly discuss and showcase how they resolved the matter.