Before I write this article, I need to confess a personal interest. I own an iPad. And I use it all the time. But I’m in a very small minority.
Despite the plethora of tablet devices launched, or soon to be launched, onto the market from the likes of Samsung, Sony, Toshiba, HP and Amazon, take up has not been as spectacular as much of the hype would have us believe.
According to a survey by Nielsen, tablet penetration in the US is estimated to be less than 5%. That makes tablets the least popular wireless device category, behind NetBooks and ereaders and well behind media players and smartphones. Tablet adoption is also growing at a lesser pace than some of its wireless rivals too – ereader penetration grew 3% between Q4 2010 and Q1 2011 according to Nielsen, whereas tablets only grew 1.4% in the same period. Unfortunately, there are no equivalent stats for the UK market, although TMT Research/Deloitte’s have estimated the UK tablet penetration is less than half that of the US at 1.7%.
At least marketers aren’t as yet faced with the same fragmentation issues that are complicating the smartphone market – Apple’s iPad is dominant, controlling approximately 80% of the market. Competitor offerings have yet to make much of a dent in Apple’s market share, despite often having better specifications than the iPad.
For publishers, iPad subscriber numbers have been mixed – largely to do with a relatively small universe of users, estimated at 500,000-750,000 in the UK. The Times and the Sunday Times have done well to attract 20,000+ daily readers – probably down to a first mover advtantage – and 10% of the FT’s new subscribers have come from its iPad app. But conversely, Conde Nast in the US has been taking steps to slow down its iPad app production, partly due to the slow uptake of subscriptions.
The problem for advertisers is that not only is the audience commanded by any particular publication small, they’re also likely to become more fragmented as publishers launch new apps. There’s also a lack of information beyond headline figures as to who these audiences are and how they’re interacting with advertising. For most advertisers, tablet advertising is proving too much of a black hole to commit serious funds to other than the odd vanity project.
There’s no doubt that tablet sales will continue to grow – 50m sales are predicted worldwide for 2011 (for comparison purposes this is about 15% of PC sales by value). We also believe that tablet audiences present ripe potential for premium and luxury advertisers. Not only are they more receptive to advertising on their devices but the device itself represents a much better showcase for premium brands than other mobile devices such as smartphones.
And with ABC due to make subscriber information available from the Summer, at least for the 50 publications that have signed up, some of the figures associated with tablets will at least become a little clearer.
But tablets for advertisers, at least for the time being, remain a sector to watch rather than commit to.