The i-Paper

Perfect by nature

Foreword

The first commercial mobile phone worldwide weighed 800

grammes and measured 33 x 4.5 x 8.9 cm – that was 1983.

Even though at the time it still cost 3,995 US dollars and

had an accumulator capacity of exactly one hour, it started

the first mobile revolution: a year later 300,000 people

owned the “mobile” device.

In 2007 there was a second revolution, this time not from

Motorola, but from Apple: the iPhone. In front of its com-

petitors´ eyes a newcomer conquered the mobile market

and step by step won more market shares – and definitely

not just because of its weight of 133 grammes.

The iPhone aims to cause a breakthrough in mobile Internet

usage. Its users all agree: its usability, multifunctionality

and design are unbeatable. And above all its advanced

touchscreen makes it a real milestone.

And though the iPhone may be small, you should not

underestimate it. Apple CEO Steve Jobs is convinced:

“Folks, it’s bigger than the PC!”

But isn’t that subjective? Do only Apple fans believe in

the iPhone – a small but rock-solid sworn-in minority?

We were wondering whether all the hype was legitimate.

What does the iPhone offer that nobody else can? Who

are the people who iPhone? And can the iPhone be

successfully used for advertising and marketing?

Every question led us deeper into the complex world of

iPhone. A world which is to be conquered if we still want to

have our finger on the pulse of our target group tomorrow.

Enjoy your read!

Sincerely yours,

Michael Schipper

It’s alive!

History

Experts in the trade are astonished at the unprecedented

capture of the mobile market by a newcomer. Never before

has a mobile manufacturer influenced the trade with such

speed and impact as Apple has done with the iPhone. Till

that time there had been no mobile device which was so

easy to use – in particular employing a touchscreen has

made history.

Before that Apple had started its market entry in coopera-

tion with Motorola. The ROKR E1 was one of the first

mobile phones which could be synchronized with iTunes.

The monochrome interface and the clunky touchwheel look

very out-dated from today´s point of view. Steve Jobs was

right in distancing himself from this third-party product.

Speculation that Apple would put out its own mobile

phone became more concrete, one that would not only

play audio files but also show videos and images.

January 2007 the secret was out: the first prototype of

the iPhone could be viewed at the Macworld Confer-

ence & Expo. A few months later came the final market

launch: on 29 June, 2007, in America, and in November

in Europe as well.

Already in its first year the New York Times dubbed the

iPhone “Invention of the year”, because it scored well in

the areas of design, user friendliness, trailblazing function

and development potential.

And it’s true. The iPhone had barely seen the light of the

mobile world when its little brother arrived: the iPhone 3G

– and Apple’s greatest competitor had been made in

house. Within the first two weeks it topped the sales of

the first device.

For one person it was definitely worth it, because for 2008,

Apple CEO Steve Jobs announced: “Apple just reported

one of the best quarters in its history with a spectacular

performance by the iPhone.”

Key Milestones:

Dec 99 Apple registers iPhone.org

Oct – Dec 02 iPhone is registered as a trademark in the

UK, Canada, Australia and Singapore

Oct 04 Apple and Motorola confirm that

they are collaborating on a new device

Sept 05 The iTunes-capable ROKR

phone is launched

Oct 05 Steve Jobs announces

more devices at Fortune

Nov 06 Apple patents the iPhone

Dec 06 Cisco launches a VoIP phone called iPhone

Jan 06 Steve Jobs officially announces the launch

of the Apple iPhone at MacWorld

Jan 06 Cisco sues Apple

Feb 07 Apple and Cisco agree to both use the name

May 07 Rumour has it that the iPhone is being

discontinued – Apple shares drop by 3 %

June 07 The iPhone is launched in the US

Sept 07 The iPhone comes to Germany and the UK

June 08 3G was released

June 09 3GS arrives!

He only wants to play

Facts

133 grammes of mobile world – the Internet in your pocket.

The first iPhone was already very easy to use. A device

with only 5 visible keys for the complex Internet and mobile

world? No wonder that the iPhone caused looks of sur-

prise and didn’t just catch the attention of the curious.

The first device still lacked a UMTS connection, GPS

and business functions, but Apple immediately presented

the more efficient iPhone 3G.

Mobile data use is only one aspect which Apple is sig-

nificantly promoting with its iPhone.

In the meantime Apple is set to take second place on the

worldwide Smartphone market. With an increase in

market shares of over 520 per cent in the past quarter

(Q3) Apple has left the Canadian Blackberry producer

RIM limping behind, according to Canalys. This worldwide

success is due in part to the launch of the iPhone G3 in

July and the international expansion of the company.

Ten million devices were already sold in 2008 – 3 million

more than predicted.

The feeling of having their own home office in their hand

and exploring it with their fingers went down well with

the users. But also the increase in speed and precise

location of coordinates via GPS function made the owners

of the new iPhone even more mobile.

Bull’s eye!

Targeting the iPhone Customer

Our mobile society wants mobile partners. But what do

people from this society look like? What characterizes

people from this society? How do we define a iPhoner?

In most cases he’s male. At the moment only 27 per cent

of women take advantage of an iPhone. And typical

iPhoners are young: two thirds under 35. Forty per cent

of them are single and have managed to avoid the bonds

of marriage – up to now.

When they switch the iPhone on they mostly surf through

the Internet (82 %), which makes them quite exotic because

“normal” mobile users very rarely use their Internet

function. They also usually make much more use of video

options and music-streaming.

They like to send their e-mails directly en route (76 %). As

a successor of the iPod the iPhone is also used more

conventionally as an MP3 player, at least by 73 %. 68 %

make use of its WIFI functionality .

How iPhoners became iPhoners has also been re-

searched: 35 % invested in an Apple device because

they thought that the technologies and functions offered

were unbeatable, 29 % liked the outstanding design and

style, and for 26 % their satisfaction with the brand Apple

was decisive.

The figures on data consumption from summer 2008

prove that iPhoning is addictive.

“iPhone users use in excess of 90 megabytes per month,

Blackberry users use between 1 and 2 megabytes per

month,” says Olaf Swantee, Executive Vice-President of

Telecommunications company Orange.

Mobile data volume explodes automatically with lower

costs and the appropriate end device. A logical formula.

A question of demand

Application Shop

The words spoken at the launch of

the first iPhone were clear: It is far

too dangerous to let some third party

produce the applications – mainly

because of the lack of stability,

explained Steve Jobs already in

January 2007.

Luckily he thinks differently today,

otherwise the iPhone would never

have become such an expandable

software platform – and a perfect

advertising market.

The initial turnover figures prove

that the applications haven’t just

remained greenfield developments:

200 million applications were down-

loaded within the first 102 days from

the specially “built” App Store.

In the meantime there are 10,000

products in the areas of books, busi-

ness, education, entertainment, fi-

nance, games, healthcare & fitness,

lifestyle, music, navigation, news,

photography, productivity, reference,

social networking, sports, travel

utilities and weather.

The download is very easy: via PC

or Mac from the App Store in iTunes

or directly with the iPhone. The ad-

vantage: quicker access.

The multi-touch display, the accel-

eration sensor, GPS, real-time 3D

graphics and 3D audio mean that

web developers will jump to accept

the challenge.

The producer of an application pro-

gram pays 99 dollars for membership

in the App Store, and then the

iPhoner can download it for free

from there. For programs that cost,

Apple retains 30 % of the price for

the service.

Houston we have a problem

The iGalaxy

Apple has made history in the mobile marketing world

with its iPhone.

Step by step the innovative device is conquering the

coat pockets of business people – at the moment private

use is still greater at 63 %. Now is the time to win over

iPhone users before other brands take advantage of

Apple’s success.

How can this be achieved? On the basis of the various

functionalities of the iPhone, we have identified options

for paving the way to the consumer. The iPhone is playfully

easy to use, so we believe that extremely original and

innovative applications provide a great chance to make

people talk about the brand. This area more than any other

provides an opportunity to prove the iPhone’s futurability.

Our iCosmos shows the “new world”:

Downloads

Web

Apps

Music + Video

Games

YouTube

GPS

The perfect wave

Surfing the Web

An Internet page consists of a complex presentation of

contents, which is best shown on a screen of 15 inches

and more. The iPhone has exactly 3.5 inches for that and

still it presents the entire Internet in an appealing and user-

friendly way on its touchscreen, which is one of the largest

on the mobile market.

For mobile use an Internet page is adapted using HTML/

WAP so that it is optimally displayed on the iPhone. At the

moment Flash and Java support are not yet available.

In April 2005 Apple launched version 10.4 of its Mac OS X

system, with it introducing Widgets written in HTML, CSS

and JavaScript with the help of the programme Dash-

board, and is often erroneously seen as their inventor.

In the meantime, the Widget function can also be used

on the mobile Apple device. Since the iPhone is always

subject to change through development, it is necessary

to currently check which applications can be used and

appropriate.

Another way to win the mobile Internet surfer is to offer

data in RSS format, like a news ticker. The user can be led

to his own homepage via headlines and short summaries.

With the pull method every subscriber can constantly

receive news updates.

Until someone cries

Gaming

For no other device than the iPhone is it so undefined how

many labels it can have at the same time and how many

markets it can or should serve. Its latest label is most

certainly also “game console” – portable and at less than

140 grammes impressively light.

The market leaders in the mobile area like Sony with its

PlayStation Portable or Nintendo DS should keep a careful

eye on the competition. Not only can the iPhone make any

train journey seem shorter with its great leisure offers, but it

also makes serious work possible, proving it to be more

and more a multifunctional partner.

The N-Gage from Nokia, which already in 2003 combined

the mobile phone with a game console, couldn’t make

the breakthrough due to its unhandy design: to make a

phone call you had to turn the device to the flat side and

then put it crossways to your ear. Not only did that attract

disconcerted looks but also led to fingerprints on the display.

The iPhone’s gaming advantage doesn’t just come from its

larger 3.5-inch display but also from the intuitive steering via

the multi-touch interface, an acceleration sensor and last

but not least its comparatively strong graphics processor.

Complex games taking up large amounts of memory also

easily find space on the 8- or 16-GB flash drive. Via a web

connection it is possible to access not only higher levels of

the games, but also the latest versions of them. The GPS

function even makes it possible to integrate the current

location of the player into the game. Its broader range of

software has transformed it into a handheld gaming plat-

form which can be taken seriously.

At home, too, gaming fun is guaranteed to be perfect with

the software extension available for version 2.2 and above:

the iPhone can be directly connected to the TV and can be

used as a game controller.

With innovative marketing strategies, the ideal partner to

playfully win over the iMarket.

Explore new shores

Conquer the World

City maps are usually small, foldable plans that can

easily be placed in your pocket, but are less handy to

stow away again properly after use. Or they are cumber-

some download services in digital form.

Still they hardly ever tell you exactly where you are. But

tedious searching has been put to an end with the GPS

function of the iPhone.

Google Maps is pre-installed and gives the precise indi-

cation of your own coordinates on a virtual map, allowing

you to explore any city regardless of how complex its

network is. With the iPhone the user-friendly city map

can be taken exactly where it is needed most, directly in

the streets.

This map is able to not only locate the user, but also

build the bridge between consumer and provider. So

the iPhone user can find not only his old school mate

or the nearest restaurant but also his favourite manu-

facturer, his local garage or his way directly to you or

your branches.

Seek, and you will find

Applications

“The iPhone is not a SmartPhone,” was what experts

were saying before Steve Jobs offered the iPhone to

third-party providers in the App Store in summer 2008.

Now it is up to the user to decide how “smart” his iPhone

is. Very slow transmission speeds and user-unfriendly

websites stop normal mobile owners from using the

Internet function of their mobiles.

That is why the applications in the App Store are tailor

made for the iPhone, which doesn’t only offer better colour

reproduction. The software Update 2.0 opened up the

option for developers to create their own applications for

the iPhone.

To implement an innovative idea the flexible programming

language xCode can be used for native software devel-

opment. Due to its modularity and with the support of

languages like Java, Python, Ruby and Perl it is also

useful for developing platform-independent software.

The free Software Development Kit (SDK) can be down-

loaded directly from the Apple homepage. On their website

or in the WAP portal, iPhone users can be linked directly

to the relevant applications in the App Store.

You benefit not only from the brand name Apple but also

from the App Store being the only legal program down-

load source and from the high frequency of use. Therefore

it offers a whole new marketing level. Fill the free black

spaces on the desktop of a newly bought iPhone with

your icons before someone else does. Or make your way

onto the favourite lists of experienced iPhone users.

The boards that mean the world

o sole mio/Music & Video

The iPhone is in many ways more than just a mobile

phone. It is the next development stage of the iPod with

its 3.5-inch display and its multi-touch interface.

With the touch of a finger one can search the virtual

media library or find favourites again.

The classic iPhoner uses the mobile phone in a completely

different way to the average mobile phone user. The iPhone

package exactly serves the demand for news services,

with video function, games, music and films.

Luckily with the new iPhone this is also possible without

headphones. Additionally no adapter is needed for the

headphones anymore, instead there is a direct connection

providing a sound experience that is considerate of the

surroundings.

Videos can be displayed in various formats on its large

display. The iPhone supports all available audio files.

In keeping with the versatility of the iPhone different file

formats can be offered, e.g. for podcasts, videocasts or

interactive TV programmes. The directly installed video

portal YouTube offers more marketing options: by video

seeding it offers a stronger video integration or the option

of making your own channel.

On the website or WAP site one can be linked directly to

videos which can be watched in superb quality directly

on the YouTube application of the device.

Small fish, big sharks

Downloads

Using downloads anyone can develop their own personal

iPhone world: Every user designs his own iPhone indi-

vidually along with the pre-installed functions.

New innovations in the areas of wallpaper, videos and

photos made especially for the iPhone can motivate the

consumer to initially download and then as a second

step to buy.

The brand presence is enhanced through branded per-

sonalization. Wallpaper files can be loaded directly with

the iPhone. Videos are available via download as well as

via a link with YouTube. Sounds can be transferred to

iTunes after the download.

Knight takes rook

iStrategy

The world is going online – and doing it mobile. Do you

want to mark time? Or will you take the next step into the

relatively unexplored space of mobile Internet usage?

There is a lot to discover for innovative explorers. What is

most important is a good strategy: The iStrategy leads

directly to the iPhone and from there back to your company.

Using market analysis potential partners can be found, the

target group and the competition more precisely defined,

and uniqueness verified.

The second step is the development of a suitable project

(Application Definition Statement): an innovative game, an

entertaining video or perhaps simply a classical Internet

page in the iPhone format? What suits you best?

Step by step the project will take form – and in step 3 the

rocket shoots off into space. The perfect move to outer

galactic success!

Analysis / Situation

Innovation / Singularity

Definition / Measures

Development / Roadmaps

Testing /App Store

Testing /Technique

DetailedConcept

Development Checkup Apple

Delivery

Launch of Project

Testing

Implementation / Project

Rough Concept

Screen Design

Target Group

Downloads

Market Partner / Cooperation

Music / Video

Selection / Specialists

Analysis / Situation

Innovation / Singularity

Definition / Measures

Development / Roadmaps

Testing /App Store

Testing /Technique

DetailedConcept

DevelopmentCheckup Apple

Delivery

Launch of Project

Testing

Implementation / Project

Rough Concept

Screen Design

Target Group

Downloads

MarketPartner / Cooperation

Music / Video

Selection / Specialists

Conclusion

The hype is justified – we think. And the ease with which

Apple as a newcomer has conquered the mobile market

is simply impressive.

The mobile Internet required an innovative device which

was also fun. The easy-to-use iPhone with its attractive

design and appealing icons certainly achieves this.

The target group is growing every day: while at the begin-

ning it may have only been the Apple fans or the curious

computer scientists, today it is more and more people

like you and me.

According to M:Metrics/Comscore, two-thirds of iPhone

users in Germany surf the Web, with 73 per cent overall

in Europe doing so. Not without reason was the documen-

tation of the US election campaign iPhone compatible.

And if iPhoners were only a minority of technology lovers

there would not be a logical explanation for well-known

companies develop ing special programs for the App Store.

The time is more than ready to explore this market before

others do it. With us you can overtake the competition

in the same impressive way that Apple has done so with

the iPhone.

When conquering the iPhone world, however, there are a

few key points to bear in mind:

A well-founded iStrategy (target group, market,

competitors, cooperations) and the consideration of

appropriate measures (classical app, web app, etc.)

should always be the basis of iPhone marketing.

It is extremely important that measures are appropriate

for the relevant market and that significant added

value is generated for the user.

Simply adopting something 100 % for iPhone from

existing online resources will not work. Careful con-

sideration of the mobile channel is of vital importance

for all campaigns.

To make the most of it, an extension to other channels

should occur, for instance the application Facebook

Connect offers the opportunity to extend the iPhone

App beyond the online channel.

Once an application has been created, appropriate

marketing via iTunes and the App Store ensures that

awareness is generated and maximizes the download

figures.

Our conclusion: The iPhone is the ideal channel for inno-

vative advertising strategies and thus the perfect channel

of distribution for future-oriented brands. iMarketing is

on the rise – and no one can do without iMarketing.

Imprint

Who we are

We are the world’s most awarded, direct and digital agency

network with more than 2,000 employees in 59 offices

around the world. We are aligned with BBDO worldwide

and a member of the Omnicom group of companies - the

world’s largest marketing services organization.

Why Clients hire us

We solve complex business problems with a simple strate-

gy: change individual consumer behavior. We succeed by

fusing our digital and direct expertise with our in depth

knowledge and understanding of consumer data. The end

result is a measurable and memorable engagement with

each and every one of our clients brands.

What we do

Interactive Marketing

Mobile and Social Media

Analytics

Branding

Email Marketing and eCRM

Direct Marketing

Interactive advertising and design

Customer Segmentation

Search Marketing

Strategy and Planning

Technology Architecture & Integration

Strategic Planning

Proximity Worldwide

Contact

Michael Schipper | CEO | tel +49 (0)40/278 52-4102 | e-mail michael.schipper@proximity.de

As one of Germany's Top 3 dialogue marketing agencies,

Proximity Germany has for the past 25 years been devel-

oping behaviour-changing ideas: innovative dialogue

communication that inspires people and which has the

power to change consumer behaviour.

Proximity offers multi-channel solutions in a variety of

disciplines, including direct marketing, online commu-

nication and mobile marketing.

The agency, which is part of the BBDO Group, is headed

by Michael Schipper (CEO), Detlef Rump (CCO) and

Markus Keller (CFO). Proximity Germany employs 300

people, based in offices in Hamburg and Düsseldorf,

and its clients include major brands like E.ON, GE, In-

tercontinental Hotels Group, Mercedes-Benz, Procter

& Gamble, Shell, Panasonic and smart.

Proximity Germany