Consumer Trends Report: Germany - Using online data to uncover political and commercial trends in Germany - Braingraph

 
Consumer Trends Report: Germany - Using online data to uncover political and commercial trends in Germany - Braingraph
Consumer Trends Report: Germany
Using online data to uncover political and
commercial trends in Germany

                                             1
Consumer Trends Report: Germany - Using online data to uncover political and commercial trends in Germany - Braingraph
Summary of Contents
1. About Us: Braingraph and Crimson Hexagon                                 •F
                                                                              uture of automobiles in Germany - which type of vehicles will
                                                                             prevail? Will it be conventional hybrids, PHEVs (plug-in hybrid
2. Methodology
                                                                             electric vehicles), BEVs (battery electric vehicles) or FCEVs (fuel
   • Research approach
                                                                             cell electric vehicles)
   •D ata sources & tools (social data via Crimson Hexagon, search
     data via Google trends)
   • Timeline                                                                5. Technology
   • Limitations                                                                •P rivacy and data protection: How is Germany reacting to recent
                                                                                  data scandals?
3. Social & political trends
                                                                                •G eneration mobile: how is the mobile phone changing German
   • The last German election and the current political situation
                                                                                  consumer and shopping behaviour?
   • Immigration as big controversial topic in Germany, driving political
                                                                                • Home
                                                                                        automation as door for IoT tech in Germany: How Amazon
     change and creating new political forces (AfD)
                                                                                  Alexa, Google Home, Nest and co are smarting up German homes
   •G  ermany and the European Union: concerns about stability in
                                                                                •W earables and the quantified self: How smartwatches, fitness
     Europe and its position with regard to Brexit
                                                                                  trackers and co are making German tech-affines more connected
   •G  ermany and the world: key topics in German conversations
                                                                                  than ever
     about international politics
                                                                                •D igital currencies and Blockchain: How is Germany reacting
4. Transportation                                                                 to the latest development in digital currencies and blockchain
   •A utomotive trends in Germany: The “Diesel-Skandal” and the                  technology?
     political consequences
                                                                             6. E
                                                                                 xecutive Summary: German key trends in 2018 through the lens
   •A lternative transportation trends: self driving cars, e-mobility, car-
                                                                                of online data
     sharing, (electric) bikes

                                                                                                                                                    2
Consumer Trends Report: Germany - Using online data to uncover political and commercial trends in Germany - Braingraph
Table of Contents
About Braingraph                                4
About Crimson Hexagon                           5

Methodology                                     6
Approach                                        7
Data, timeline, and limitations                 8

Research Results: Social and political trends   9
Elections                                       10
Immigration                                     13
Germany and the EU                              16
Germany and the world                           17

Research Results: Transportation                18
The diesel scandal                              19
Alternative transport trends                    22
The future of the auto industry                 26

Research Results: Technology                    30
Digital privacy                                 31
Mobile phone use                                34
Home automation                                 40
Wearables                                       43
Digital currencies and Blockchain technology    46

Executive summary and conclusion                48
Appendix                                        52

                                                     3
About Braingraph                                                                         Audience data
                                                                            Behaviour data
In today’s Digital Economy, understanding data is the key to unlocking                     Competitive behaviour
growth, increasing efficiency, and driving effectiveness.                         Consumer data
At Braingraph we are using behavioural science, big data and cutting edge   Predictive data           CRM data
technology to put that key into your hands. The following report about                     Geo data
German market trends is testament to that approach and proof of our
                                                                                            Performance data
commitment to create value by combining data, science and technology in
the most appropriate and meaningful way.

Through their partnership with Crimson Hexagon, Braingraph helps brands
and customers gain a keener insight into their customers and the markets
they operate within.

                                                                                                                   4
About Crimson Hexagon
Crimson Hexagon helps global brands better understand their consumers. With instant access
to the world’s largest volume of unstructured text and images across social, online public,
and enterprise-held data sources, Crimson Hexagon’s AI-powered consumer insights platform
allows clients to analyze audiences, track brand perception and campaign performance, and
even detect competitive and market trends. Our clients include Anheuser-Busch InBev, Adidas,
General Mills, Paramount Pictures, and Twitter.

                                                                                               5
Methodology

              6
Our approach
                Digital Data                                                           Behavioral Insight
      Digital data sources like social,             extracting value          Frameworks based on behavioral
         search, stats, traffic data             from the intersection         science and empirical evidence
                                                     between data,
                                                    behaviour, and
                                                      technology

                                                     Technology
                                 Using advanced analysis techniques including machine
                                          learning, AI and predictive analysis

             Market               Competitor          Consumer           Performance           Growth
             analysis             benchmark            behavior            analysis            analysis

                                                         Value
                               Increased marketing effectiveness, reduced churn, improved
                                 customer engagement, increased customer lifetime value
                                                                                                                7
Data, timeline & limitations
Data                                                                       Limitations
• This report relies on search data (via Google trends), social data      •A
                                                                             lthough the highest standards of cross-validation and contextual
   (via Crimson Hexagon), statistical data and trusted news source          verification have been applied, this report should not be used as
   (statistical and news sources referenced where applicable). Social       the sole basis for decision making but is aimed to be an additional
   data is composed of mentions on public social media platforms            source of insight to be used alongside other robust research
   (Twitter, Forums, Blogs, YouTube, Reddit, Instagram, public
                                                                           •D
                                                                             espite the highest levels of accuracy applied we do not guarantee
   Facebook pages).
                                                                            this report is free of any errors and reject any liability for decisions
•N
  one of the data can be taken as absolute, which is why we                made on the basis of this report
 triangulated and cross-referenced all datasets wherever possible.
 All data points should be questioned and interpreted in context and
 constructive feedback is always appreciated.

Timeline
•S
  ocial data used in this report reaches back as far as 2009, with
 more remote data becoming less dense, rendering more recent
 results generally more reliable

•S
  earch trend data used in this report stretches back as far the last 5
 years (2013-2018)

                                                                                                                                                       8
Research Results: Social and Political Trends
• Elections: The most recent German election and the current political situation
• Immigration: The big controversial topic in Germany, driving political change and creating new
  political forces (AfD)
• Germany and the European Union: Concerns about stability in Europe and its position with
  regard to Brexit
• Germany and the world: Key topics in German conversations about international politics

                                                                                                    9
social/political trends

                                                                        Bundestag*, by party, % of seats

   The most recent German
                                                                                    Christian Democrats (CDU/CSU)         Social Democrats   Alternative for Germany (AfD)
                                                                                    Free Democrats (FDP)     The Left**      The Greens

   federal elections
                                                                          Chancellor                                Parties in government                       Parties in opposition
                                                                                      1990
                                                                                      1991
                                                                                      1992
                                                                                      1993

                                                                        Kohl
                                                                                      1994
   Angela Merkel “won” the last German election on 24th September                     1995
                                                                                      1996
   2017 with her party (CDU/CSU) securing 33% of the vote. However,                   1997
                                                                                      1998
   she lost more than 8 percentage points from her total in the                       1999
                                                                                      2000

                                                                        Schroeder
   previous election.                                                                 2001
                                                                                      2002
                                                                                      2003
   The Social Democratic Party (SPD) also suffered, achieving                         2004
                                                                                      2005
   its worst result since the second World War, with just 20%. A                      2006
                                                                                      2007                    Grand Coalition
   newcomer, AfD, became the third strongest party in the Bundestag                   2008
                                                                                      2009
   with 12.6%, whilst the Free Democrats (FDP) returned with 10.7%                    2010

                                                                        Merkel
                                                                                      2011
   after losing all their seats in the 2013 election.                                 2012
                                                                                      2013

   The other parties to achieve representation were the Left and the
                                                                                      2014
                                                                                      2015                      Grand Coalition
                                                                                      2016
   Greens, who each won close to 9%.                                                  2017
                                                                                                                                                                                  Independent

                                                                                      2018                                     Grand Coalition
                                                                                              75                    50                25              0                      25                 50
                                                                       *Election result **Includes predecessors
                                                                       Sources: ParlGov; Federal Returning Officer

                                                                       Source: The Economist

                                                                                                                                                                                                     10
social/political trends

                                                                           Conversations about Angela Merkel in Germany, in German Language (2009-2018)
                                                                                         Basic Positive (329k)        Basic Negative (833k)      Basic Neutral (363k)

                                                                                          30k                                                                                          Run-up to German
                                                                                                                                                                                       elections 2017

   Rising frustration                                                                     25k                                                                     Syrian refugee
                                                                                                                                                                  crisis
   The sentiment around Angela Merkel has been declining over time,                                                                     Run-up to German
                                                                                                                                        elections 2013
   with peaks of negativity in the run up to the parliamentary elections                  20k

   (“Bundestagswahl”) in 2013 and 2017 as well as her involvement in                                                Scandal around

                                                                           Post Volume
   the nomination of Christian Wulff as President of Germany, and her
                                                                                                                    Christian Wulff
                                                                                          15k
   decision to open German borders to all Syrian refugees in 2016.
                                                                                          10k

                                                                                            5k

                                                                                             0
                                                                                           Jan 2009      Jan 2010      Jan 2011       Jan 2012   Jan 2013     Jan 2014      Jan 2015       Jan 2016       Jan 2017

                                                                                                                                                                                                                     11
social/political trends

                                                                         Mentions vs Sentiment in Merkel Conversation in Germany, in German Language (2009-2018)
                                                                                        Mentions   Net sentiment     Trendline for net sentiment
                                                                                         400k

   Increasing volume but declining net sentiment                                         300k
                                                                                                      -11%

   Angela Merkel has been increasingly discussed in German
   public social media with key spikes in 2013 (German federal

                                                                          Post Volume
   parliamentary elections) and 2016 (fall-out of the refugee crisis).                   200k                                          -26%
                                                                                                                                                                                    -28%
   Merkel’s net sentiment shows a clear downward trend with the                                             -29%

   scandal around German president Christian Wulff and the refugee                                                                                 -34%                    -35%

   crisis marking key negative peaks in Merkel’s net sentiment.                          100k                                -36%                                                          -36%
                                                                                                                                                                 -40%

                                                                                           0
                                                                                           2009    2010       2011      2012        2013           2014   2015      2016     2017          2018

                                                                                                                                                                                                  12
social/political trends

                                                                         Political Key Topics

   Immigration: a
                                                                                                          Pensions       Security

   controversial topic                                                                 Immigration

                                                                                                                          Family
   Immigration: Germany’s biggest issue                                                                  Education
   Immigration is currently the biggest political topic in Germany,
   followed by other large scale social issues like social injustice,
                                                                                                                        Environment
   pensions, education and problems of the labour market.
                                                                                     Social Injustice
                                                                                                        Labour market
                                                                                                                          Taxes

                                                                        Source: Infratest

                                                                                                                                      13
social/political trends

   Immigration: The “silent” issue with relevance
   especially in Eastern Germany
   Being the biggest political topic in Germany at the moment, it is
   unsurprising that immigration is also strongly talked about.
   Immigration is currently the most important political topic in
   Germany. However, the online conversation about the topic is not
   evenly distributed throughout the country. Surprisingly, the political   Immigration related        GDP per Capita in         Percentage of
   movement on the right is present predominantly in areas with             conversations: darker      Germany. Poorer areas     people voting for
                                                                            areas represent higher     mapped in lighter         AfD (“Alternative for
   lower levels of online conversations about the topic.                    levels of conversations    colours.2                 Germany”), a right-wing
                                                                            per capita.1                                         to far-right political
                                                                                                       Source:
                                                                                                       Statistisches Bundesamt   party. Darker colour =
                                                                            Source: Crimson Hexagon,
                                                                            2015-2018                                            higher percentage.3
                                                                                                                                 Source:
                                                                                                                                 Morgenpost.de

                                                                                                                                                           14
social/political trends

   Outspoken xenophobia                                                                                                                                                                 Rostock

   The map (right) reveals per capita frequency of xenophobic
                                                                                                                                                             Hamburg
   conversations. Berlin, Cologne and Hamburg lead the pack, but it is
   worth noting that xenophobia is mostly an implicit behaviour.                                                                                  Bronen

                                                                                                                                                           Hanover
                                                                                                                                                                                                    Berlin

     Top Xenophobia Discussion by City/Urban Area
                                       2k                                                                                              Dortmund                 GÖttingen
                                                                                                                                                                                          Leipzig    Dresden
     Posts per Capita (per million)

                                      1.5k                                                                                          Cologne

                                       1k

                                      500                                                                                                                                   Nuremberg

                                                                                                                                                                                    Regensburg

                                        0                                                                                                           Stuttgart
                                                                                                                               rg
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                                                                                                                                                                                 Munich
                                                                                                                    au
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                                                                                                                                                                                                               15
social/political trends

   Germany and the European Union
   Is Germany’s relationship with the rest of Europe changing?
   EU-related conversations in Germany show that, although still a big topic, Brexit-related conversations are slowly
   declining whilst the relationship of a “European Germany” to the US is growing into a real and controversial topic.
   Additional European topics of relevance include refugees (Flüchtlinge), Turkey (Türkei), Greece (Griechenland), and
   Russia (Russland), but only the latter seems to have the potential to grow into a substantial topic of note in 2018.
   title

               2016                                                                                                                    2017                                                                                                                                                   2018

                                                                                                           brexit                        usa time
                                                                                                                                                                                                                                                                    griechenland
                                                   europäischen

                                  kommission                                                                                                welt                                                           staaten gute
                                                                                                                                                                                                                                                              paar
                                                                                                                                                                                                                                                                         belgien
                                                                                                                                                                                                                                                                                       russland
                                                     dafür bekommen                                                                              türkei                      geben                                                                gb
                                                                                                                                     russland

                                                                                                                                                                                                                                                        usa
                                                                                                                                                           china                                                                                                            china
                                                                                                                                                                                                                                     afrika                                         frankreich
                      staaten                           geld                berlin politiker
                                                                                                                                 gar
                                                                                                                             trump                                      asien frage
                                                                                                                                                                                                                                                                                                  online
                                                   gerne                                                                                                                                                                                                                    schweiz                        deutschland
              macht                                                                                  letzen      natürlich                   deutsche               saison            europäischer                      regierung
                                 nichts
                                                                                                                              nichts
                                                                                                                                                                             gehen
                                                                                                                                                                                                                                                                                       länder
                                                        deutschen                                                                                                                                          deutsche
                          welt                                                                                                                                                                                                       politik                                                      recht
                                                                                                                                                                                                                                                                           weiterhin
                lösung                        ausland               jemand                                fast                                                          afrika fraknreich
                                                                                                                                                               kommen                                                                                             bürger
      flüchtlinge gar                                                                            leider        dafür                                                                    merkel langen
                                                                                                                                                                                                                            schulz                                                  geben
                          frau                                      weg           griechenland            jemand recht
                                                                                                                                                                        weg genau
                                                                                                                                                                                                                                                                           türkei           jahr
                  richtigdenen
                         merkel                            deutschedürfte   euro                            politik
                                                                                                                                                                        land
                                                                                                                                                                                länder
                                                                                                                                                                                                             cdu groko
                                                                                                                                                                                                                       zeit trump
                                                                                                                                                                                                                                 herr

            kommen
                                                                                                                                                                                                                     spd                 ausland

                                                                                                                                                                                                                                                                     welt
                                                                    land afd politik         gemacht
       länder
                    türkei                               besser                        leute                  klar braucht             jahr            zeit
                                                                                                                                                                                            europäischer
                                                                                                                                                                                                           entlich       macht    nichts                                                    asien
                                                                          markt briten                                                                     möchte                                                                       land
                                           krise                                                              berlin
                                                                                                                               staaten                                                                                                                                                     klar
                                                                                gb                                                                     macht                                                                                                       gar
                                                                                      genau                                                                                                                                                                                         bild
           europäischer
                                         frage raus                                sicher
                                                                                                                                          vielleicht

                                                                                                                                                       euch
                                                                                                                                                                                      parlament                  flüchtlinge                             weg         tun
                                                                                                                                                                                                                                                                        nato
                            demokratie                                                                                                                                                                                                             gehen

                                                          brexit
                                                                                                                                                                             schulz
                                                                                                                                                 richtig                                                                                                          bishereuch

                                     usa jahr
                                                                                                                                                                                                                                                         bleibt

                                                                                                                             euro                       egal
                                                                                                                                                                                                                     geid    grenzen
                                                                                                                                                                                                                                              problem                    vielen     brexit
                                 problem                                                                                                                                                                                                                merkel              somit

                                                                                                                                                                                                                                                                                                                         16
social/political trends

   Germany & the world
   While Brexit conversations in Germany are cooling down, the US
   conversation is just heating up, especially in regard to Donald                                                                  macron
                                                                                                                     deutschland
   Trump. Other international political topics — Russia/Putin,
                                                                                              politische
   Britain/Brexit, Turkey/Erdogan and even Syria — don’t approach                                          russland
                                                                                                                                     frankreich
   the volume of conversation dedicated to the US and #Trump,                                                afd
                                                                                                                     europa merkel             wählen
                                                                                                sagen                                                 zeit
   who has even become a part of mainstream media and German                                                                 eu                          bild
   advertising.
                                                                                                     syrien
                                                                                                                  putin politiker       tatsächlich macht
                                                                                                  deutsche                                                   wahl
                                                                               braucht    china              jahr
                                                                                       weiẞ                  assad
                                                                                                                     orban
                                                                                                                                                    brexit
                                                                                                                                               nichts
                                                                                   lässt
                                                                                                                    keinen
                                                                                                                                            hätte sollten politik
                                                                              seinen
                                                                     besser

                                                                                       trump
                                                                                                                       kommen
                                                                         medien                                                                            gehört
                                                                                                                     partei      erdogan donald
                                                                                frau                                         jong
                                                                                                            bush scheint           land
                                                                                                                                       kim
                                                                                                                                           usaweltgewählt
                                                                              präsidenten              naja
                                                                                                                         nordkorea            weit
                                                                                          obama sicher       problem                 präsident clinton
                                                                                                           eher
                                                                                                                                    polen

                                                                                           realdonaldtrump

                                                                                                                                                                    17
Research Results: Transportation
• The “Diesel-Skandal”: Political and commercial consequences
• Alternative transportation trends: Self-driving cars, e-mobility, car-sharing, (electric) bikes
• The future of automobiles in Germany: Which type of vehicles will prevail?

                                                                                                    18
transportation

                                                                          German Conversations About the Diesel Scandal (2015-2018)

   The diesel scandal                                                                   Basic Positive (7.5k)       Basic Neutral (11.6k)   Basic Negative (46.7k)
                                                                                                                                                                                                 In February
                                                                                         8k                                                                                                      2018, the
                                                                                                                                                                                                 highester
   #Dieselgate was a major scandal that generated more than 65,000                                                                                                                               German federal
                                                                                                                                                                                                 administrative
   conversations on German public social media between October                           7k                                                             Scope of Dieselgate becomes
                                                                                                                                                        known to be much greater; in July        court rules that
                                                                                                                                                        2017, EU commission investigates         driving bans
   2015 and the publication date of this report. The conversation is                     6k
                                                                                                                                                        German car manufacturers for             for Diesel cars
                                                                                                                                                                                                 are generally
                                                                                                                                                        building a cartel
   highly critical with a net sentiment of -59% (over 70% of mentions                                           VW diesel scandal
                                                                                                                                                                                                 possible

                                                                                                                breaks in Oct 2015
   are negatively sentimented).                                                          5k

                                                                          Post Volume
   The legal and financial consequences of the scandal are vast and                      4k

   varied, affecting up to 13 of the 15 million Diesel cars in Germany.
                                                                                         3k
   The scandal mainly affected VW, Porsche and Audi, ranging from
   driving bans to fines, including an estimated 24.4 billion Euros in                   2k

   costs for Volkswagen alone.
                                                                                         1k
   Source: Infratest

                                                                                           0
                                                                                        Jan 2015           Jul 2015             Jan 2016        Jul 2016             Jan 2017         Jul 2017

                                                                                                                                                                                                                    19
transportation

   #Dieselgate: The fall-out                                                                 Change in New Car Registrations in Germany by Fuel Type (Jan-Mar 2017 vs 2018)

                                                                                              Petrol                         +20.3
   Volkswagen’s stock has largely , but not completely, recovered
   from the scandal. Share prices originally plummeted over 60%, but                          Diesel             -21.3
   now rest at a 20% loss compared to the pre-scandal high in 2015.                           Liquid Gas                    +18.5
   However, diesel car sales in Germany have declined 21% between                             Natural Gas
                                                                                                                                                    +433.2
   Q1 2017 and Q1 2018. Car-buying conversations have also shown
   a relative decrease in purchase intent for VW compared to rival
                                                                                              Hybrid                                         +64.1

   brands, Ford and Fiat.                                                                     Plug-In
                                                                                                                                            +60.5

    Purchase Intent VW vs Competitors (in German Social Media)                                Electro                                               +79.9
          Change in new car registrations in Germany by Fuel type January to March                                                         Net Change in New Car Registrations
                                              VW      Ford   Fiat   VW vs Competitor Data

                                              2.5%                                          Change in new car registrations in Germany by fuel type 2018 compared to same time period
                                                                                            2017 (Source: KBA)
                                                2%
    Percent Change in New Car Registrations

                                                                                             Volkswagen Share Price Development (2013-2018)
                                              1.5%
                                                                                                           250
                                                                     Dieselgate
                                                1%
                                                                                                           200
                                               .5%

                                                                                                           150

                                                                                             Share Price
                                                0%

                                               -.5%                                                        100

                                               -1%
                                                                                                           50

                                              -1.5%
                                              18
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                                      M r 20 8
                                          n 17
                                          v 17
                                         pt 17
                                      Se l 20 7
                                         ay 17
                                      M r 20 7
                                          n 16
                                          v 16
                                         pt 16
                                      Se l 20 6
                                         ay 16
                                      M r 20 6
                                          n 15
                                          v 15
                                         pt 15
                                      Se l 20 5
                                         ay 15
                                      M r 20 5
                                          n 14
                                          v 14
                                          p 14
                                           l 4
                                         ay 14
                                      M r 20 4

                                                                                                            0
                                         a 1
                                        Ju 201
                                         a 1
                                        Ju 201
                                         a 1
                                        Ju 201
                                         a 1
                                        Ju 201
                                         a 1

                                            20

                                                                                                                 2014           2015              2016                 2017         2018
                                       M 20
                                       Ja 20
                                       No 20
                                       M 20
                                       Ja 20
                                      No 20
                                      M 20
                                       Ja 20
                                      No 20
                                      M 20
                                       Ja 20
                                      No 20
                                      Se 20
                                      M 20
                                          n
                                       Ja

   Source: Bloomberg/NZZ                                                                                                                                                                   20
transportation

                                                                        Best-Selling Car Brands in Europe
                                                                                 Sales in 2016                 Sales in 2017
                                                                                     1.8m
                                                                                     1.6m
                                                                                     1.4m
                                                                                     1.2m

                                                                         Car Sales
   #Dieselgate: Big picture
                                                                                      1m
                                                                                     800k
                                                                                     600k
   Looking at this from a “Europe Only” Perspective, the scandal                     400k

   doesn’t seem to have impacted Volkswagen that much. With only                     200k
                                                                                        0
   minor YoY sales changes for 2017 vs. 2016, the brand remains the

                                                                                                    %

                                                                                                                    %

                                                                                                                                   %

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                                                                                                                                                                              ce
   biggest car manufacturer in Europe with slightly over 1.7 million

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   cars sold in Europe alone (source: ACEA).                            Best-Selling Car Models in Europe
   The only visible “hiccup” in Volkswagen’s car sales was in March             Sales in 2016                  Sales in 2017
                                                                                     500k
   2017 when they temporarily lost the number one selling position to
   Ford (Fiesta becoming the most sold European car instead of VW                    400k

   Golf), but VW regained that position for the whole year 2017 with                 300k

                                                                         Car Sales
   483,105 cars sold (only 2% less than 2016).                                       200k

                                                                                     100k

                                                                                        0

                                                                                                     %

                                                                                                                    %

                                                                                                                            2%

                                                                                                                                          5%

                                                                                                                                                                             %

                                                                                                                                                                                         1%
                                                                                                                                                            5%

                                                                                                                                                                                                     2%

                                                                                                                                                                                                                         0%

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                                                                                                                                                                                                                                                 21
transportation

   Alternative Transport
   Trends                                           Search Interest Over the Past 5 Years in the German Market
   Going electric                                                 Electric Car   Autonomous Car      Carsharing   Electric bicycle
                                                                  100%
   It’s not just electric cars — electric bikes
   are on the rise in Germany too. E-bikes
   are showing double the amount of search                         75%
   demand as electric cars. Concerns about the                                                                                German government
   infrastructure needed to support electric cars                                                                             announces 4,000€
                                                                                                                              buyer’s premium

   don’t seem to extend to e-bikes.

                                                     Axis Label
                                                                   50%

                                                                   25%

                                                                    0%
                                                                  Apr 28, 2013              Jan 18, 2015                  Oct 9, 2016

                                                                                                                                                  22
transportation

                                                                          Transportation Methods Share of Voice Trend
                                                                                                      Car Sharing (20%)   Driverless Cars (10%)   E-Bikes (23%)   Electric Cars (47%)
                                                                                                      100%

                                                                                                      90%

   The rise of the e-bike                                                                             80%

                                                                                                      70%

                                                                          Share of Voice Comparison
   The graphic to the right reinforces that e-Bikes are an increasingly                               60%
   popular transportation trends in Germany. Despite the rapid
                                                                                                      50%
   growth, though, e-Bikes still only account for half the conversation
                                                                                                      40%
   volume dedicated to electric cars.
                                                                                                      30%

                                                                                                      20%

                                                                                                      10%

                                                                                                       0%

                                                                                    8
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                                                                                                                                                                                        23
transportation

                                                                           E-Bikes v E-Cars Share of Voice Trend
                                                                                                       E-Bikes (33%)   Electric Cars (67%)
                                                                                                       100%

                                                                                                       90%

   E-bike beats e-car in net sentiment and growth                                                      80%

                                                                                                       70%

                                                                           Share of Voice Comparison
   German social media conversations about e-bikes show a                                              60%
   stronger net growth (2010-2018) compared to conversations
                                                                                                       50%
   about electric cars. E-bikes also beat electric cars in net sentiment
                                                                                                       40%
   by 8 percentage points. The only caveat here is that e-bike
                                                                                                       30%
   conversations seem to be highly seasonal, spiking the most in the
   warmer summer months.                                                                               20%

                                                                                                       10%

                                                                                                        0%

                                                                                    8
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                                                                           Ja 20 7
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                                                                               r 16
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                                                                                                                                             24
transportation

   Key adoption issues around e-bikes and electric cars in Germany
   Mobility restrictions for charging electric vehicles still dominate the e-vehicle
   conversation. Both discussions focus on battery limitations — too weak (for e-bikes)
   or too small a range (“reichweite”). Other common criticisms focus on e-bikes’
   perception as being ridiculous (“lacherlich”) while electric cars are often called out for
   their high price (“teuer”).

    E-Bikes Word Clusters                                                                                               Electric Cars Word Clusters

                                                                                                                                                                strom                             eigentlich
                                                              verkümmert
                                                  km                           verdoppelt
                                                                                                  fahrer                                        verbrenner
                                   bergab                                                                                                                                                     nachts finde
                                                                                                                                                                                      nächtsten                     möcht

                                                                                                                                                          tesla
                                                                wert einsatz
                            auto
                                                lächerlich                       fall      nie                                                                                                             parken
                                                                                                                                                                                                       nie blätze
                                                                                                                                                                                                vorallem
                                                                                                        gegenüber                        elektroautos                                         morgen
                                                               pedelecs
                                                                                                                                                                                                    geparkt
                                                                             kommen
               deutschland         industrie                                                  verlust                                                                                                          obergeschoss
                                                                                                                                                                                                                                fahre
                                                                                                                fährt               weniger
                                                                                                                                              dafür     lange                                   jemand
                            jahraut        zweirad
                                                            sprichwörtlich
                                                                                                                                                                 model
                                                                                                                                                                            gegen                                    genau kaufen
                                                                                                                                                        nichts
                                                                                                  problem
                                     zivjenen
                                                                              unerträglich
                           verband aut                                                                                                                                                        bringt
       fahrrad         verkauft chinesen bedeutet                              leute
                                                                                                                               reichweite        bmw                  mobility
                                                                                                                                                                                           weniger
                                                                                                                                                                                                           autos         weiẞ
                                                                                        verzweifelt
                                                                                                                                                             diesel
                                                                 schmerzhafter zustand                                                          hybrid                           leider
                                                                                                                                                                                       teuer
                                                                                                                                                                                                                      auto
                              theoretisch                                                  echt normalen                                                                                                      macht
                                                    beste                       dinge
                                                              trail                                                                                                                 jahr
                                                                       fahre
                                         akku         eider

                                                                  meinem immer
                                                                                                                                                        problem                      meinen

                                                                                                                                                                                                     elektro
                                                                                                                                                                                                                                        25
transportation

   The future of the auto
   industry
   The future is hybrid                               Search Interest Over the Past 5 Years in the German Market
                                                                                       Electric Car   Autonomous Car      Carsharing   Electric bicycle

   Hybrid technology (using more than one form                                         100%

   of onboard energy) could have the potential
   to become the next engine standard in
   Germany and elsewhere. While still limiting                                          75%

                                                       Google Trends Search Interest
   the negative impact on the environment,                                                                                                         German government
                                                                                                                                                   announces 4,000€

   hybrid engines are also less reliant on electric                                                                                                buyer’s premium

   charging infrastructure.                                                             50%

                                                                                        25%

                                                                                         0%
                                                                                       Apr 28, 2013              Jan 18, 2015                  Oct 9, 2016

                                                                                                                                                                       26
transportation

                                                                            Title

                                                                                                                             fahren             toyota               plug massenproduzierte
                                                                                                                                      besser
                                                                                                             hybridautos                                       zweiten        befindet
                                                                                                                                                                          platz
                                                                                                       prius                                                   liste zhang
                                                                                                                                                            markt
                                                                                                                                                                   welt
   Fuel cell hybrid
                                                                                                                              hybridfahrzeug                                                             wasserstoffantrieb
                                                                                                                                                      zusammen          elektro
                                                                                                                                                              autofamilie
                                                                                                               geschreiben
                                                                                    hybridfahrzeuge    hev
                                                                                                                                        motor

   Fuel cell technology is another big topic in the conversation about                                strom                                                                                  electromotor
                                                                                                               akku fahrzeuge
                                                                                                                                                               mercedes

   hybrid vehicles. Fuel Cell Vehicles (FCVs) are electric vehicles that
                                                                                                                                       elektrisch

                                                                                                                                                                          hybrid
                                                                                                                                  km                 bmw                                           zukunft
                                                                                                                                                                                                              hybridantrieb
   use a fuel cell instead of — or in addition to — a battery to power an                                                                  problem            fahrzeug

                                                                                                                                                                                                   phev
   electric motor, as a completely clean form of transportation.                                                                                wasser              kommen
                                                                                                                                                            autos              bev           outlander

                                                                                                                                                    akkus             diesel     deutschen

                                                                             brennstoffzelle
                                                                                       (fuel cell)
                                                                                                                                                      wasserstoff

                                                                                                                                                                                                                              27
transportation

                                                                       Mentions in Future Transport Conversations vs Brands

   Which brands lead in future tech?
                                                                       Total of 31,834 conversations in German public social media, 2010-2018.
                                                                                                                     3k

   German car brands aren’t considered industry leaders in

                                                                       Mentions in future transport conversations
                                                                                                                    2.5k
   conversations about the future of transport.
   The most mentioned brand in this context is Toyota, whose                                                         2k

   Prius model is discussed on German social media as a model of
                                                                                                                    1.5k
   sustainable transportation.
   The first German brand considered a leader is Volkswagen,                                                         1k

   with less than half (1,328 vs. 2,877) of the conversation volume
                                                                                                                    500
   mentioning the future of transport. BMW follows close behind with
   1,303 conversations.                                                                                               0
                                                                                                                           Toyota   Volkswagen   BMW   Mercedes   Audi   Porsche

                                                                                                                                                                                   28
transportation

                                                                         Sample conversations from German public social
                                                                         media (Forums, 2016-2018)

                                                                           So wenig Sprit schlucken Stromautos
                                                                           ...praxisnahen Erläuterungen. Ich stimme Dir in allen Punkten zu, und halte den
                                                                           zitierten Punkt der “lokalen Elmissionsfreiheit” für den wichtigsten. Ich bin zwar noch
                                                                           kein reines E-Auto gefahren, aber ein Hybridfahrzeuge (den Prius+) und war sofotr von
                                                                           der Ruhe begeistert, die in diesem Auto herrscht. Vor allem im Stadtverkehr: Da wo
                                                                           mein D-CAT an der Ampel vor sich hinnagelt, herrscht im...

                                                                           Post on motortalk.de
   Toyota Prius conversation rising in Germany                             ...Prius IV läuft, läuft er mit 40% Wirkungsgrad. Sobald der Benziner im Golf GTE läuft,
                                                                           läuft er mit Glück bei 33.5%. Und deswegen wird auch andersrum ein Schuh draus:
   Since its debut, Toyota’s Prius has been considered one of the          Der Plug-in-Hybrid spart im Stadverkehr und bei niedrigen Geschwindigkeiten, in
   most futuristic and efficient vehicles, thanks to its reduced noise     denen der Benziner nicht laufn muss und die Akkuladung aushält. Auf der BAB und
   emissions and energy-efficient technology. As a result, it has          nach

   become an increasingly prevalent topic of conversation among
   German car experts, especially on forums.                               Nichts davon braucht die Prius-Konstruktion. Der Prius ist bereits konzeptionell
                                                                           ausschlieẞich als reines Hybrid-Fahrzeug enstanden, dessen hohe Gesamteffizienz
                                                                           und gute Emissionswerte ein Gesamtpaket aus den Komponenten Rekuperation von
                                                                           Bremsenergie + (saugrohreinspritzenden) Motor im Atkinsonprinzip + studenloses
                                                                           Planetengetriebe + Aerodynamik + Leistungsverzweigung darstellt. Das System ist
                                                                           nicht umsonst patentiert, während alle anderen Hersteller mit komplexeren, teureren
                                                                           und aufwändigeren Lösungen “drum herum” bauen müssun.

                                                                           Gepaart mit der extremen Haltbarkeit und Langzeituverlässigkeit der gesamten
                                                                           Technik, die bisher noch immer unerreicht von der Konkurrenz ist. Dauertests und die
                                                                           Erfahrungen von Taxi-Unternehmern (die immer mehr auf den Prius umsteigen und ihre
                                                                           alten Diesel-Flotten ausmustern) sprechen Bände. Die sehr hoch Messlatte von Toyota
                                                                           mussen andere erst erreichen.

                                                                                                                                                                      29
Research Results: Technology
• Digital privacy and data protection: How Germany is reacting to recent data scandals
• Generation mobile: How the mobile phone is changing German consumer and shopping
   behaviour
• Smart homes and IoT: How Amazon Alexa, Google Home, Nest and others are smarting up
   German homes
• Wearables and the future of fitness: How smartwatches, fitness trackers and other wearables
   are helping German techies stay active
• Digital currencies and Blockchain: How Germans are reacting to the latest developments in
   digital currencies

                                                                                                 30
technology

                                                                       Digital Privacy Search Interest (German Market)
                                                                                                        Datenschutz       DSGVO   Cambridge Analytica
                                                                                                        100%

                                                                        Google Trends Search Interest
                                                                                                         80%

   Digital privacy                                                                                       60%

                                                                                                         40%

   German interest in data protection highest in 15                                                      20%

   years
                                                                                                          0%

   The volume of online conversation about data protection in                                           Apr 28, 2013                Jan 18, 2015        Oct 9, 2016

   Germany shows that interest in this topic has never been higher
   over the last 15 years. While some of this conversation focuses     Digital Privacy Search Interest (UK Market)
                                                                                                        Data protection    GDPR   Cambridge Analytica
   on recent data breaches (like Cambridge Analytica), most of the                                      100%
   discussion centers around recent EU-driven regulation changes,

                                                                        Google Trends Search Interest
   like GDPR. When we compare UK search trends to those in                                               80%

   Germany, we see that the data-protection topic generally receives                                     60%

   about 60% more attention in Germany than the UK.
                                                                                                         40%

                                                                                                         20%

                                                                                                          0%
                                                                                                        Apr 28, 2013                Jan 18, 2015        Oct 9, 2016

                                                                                                                                                                      31
technology

                                                                       Sentiment of German Data Protection Conversations
                                                                                              100%

                                                                                              80%

                                                                       Sentiment Proportion
                                                                                              60%

                                                                                              40%

                                                                                              20%
                                                                                                                                                                                      53%
                                                                                                                                                   29%
                                                                                                                  18%
   Data protection is trending on German social                                                0%
                                                                                                                 Positive                         Neutral                           Negative

   media
   Data protection is a hot topic in German social media               German Data Protection Conversations (2010-2018)
   conversations, fuelled primarily by consumer and IT professional        193k+ conversations, 25% in the last 12 months alone
                                                                                                                                                                             Most recent spike
   debates over privacy related changes to platforms like Facebook                              8k
                                                                                                                                                                             driven by Cambridge
                                                                                                                                                                             Analytica
   and Google as well as new government policies. The peaks in                                  7k

   German data protection conversations highlight the history of big                            6k
                                                                                                                                                                                       GDPR/DSGVO
   data leaks and general privacy policy changes.                                                                                                                                      conversations
                                                                                                5k

                                                                             Post Volume
                                                                                                         Anonymous and                                                    Concerns about
                                                                                                         Wikileaks-related                    Concerns about
                                                                                                                                              Facebook’s graph            government data
                                                                                                4k       data leaks
                                                                                                                                              search function             retention policies

                                                                                                3k

                                                                                                2k

                                                                                                1k

                                                                                                 0
                                                                                              Jan 2010    Jan 2011      Jan 2012   Jan 2013     Jan 2014     Jan 2015   Jan 2016      Jan 2017

                                                                                                                                                                                                       32
technology

                                                                        Data Privacy Fear Word Cloud

   Fear of data theft rising among Germans
                                                                                                                          datendiebstahl

                                                                                                      datenklau                                            google       datenschützer
   German “angst” about privacy violations and data breaches stem                                                         macht deutsche facebook
                                                                                                                              nsa
   from a variety of topics, including:                                                                                              welt          interessieren
                                                                                                  internethätte                         german
                                                                                                                                             davor               sensible

                                                                                                               angst
   • Data and identity theft                                                                                                                                         leuten
                                                                                                                                                                                        sicherheit
                                                                                                                                                                                                      ersrech
                                                                           gruppenrichtlinien       freiheit
   • Violations of personal privacy                                                             windows statt
                                                                                                                                                  personenbezogene     sagen
                                                                                                                                                                                 leute
                                                                                                                                                                                         wissen

                                                                                                                                           tun
   •Exposure of sensitive, personal information (such as medical or
                                                                                                                                                                                       hast
                                                                                    daranhindern         berlin

      bank records)                                                       erschweren bringen microsoft
                                                                                                                            dsgvo deutschland
                                                                                                                                                                      daten                persönliche
                                                                                                           privätsphäre                                   nehmen

                                                                                                                                                 wochen                               möchte

   • Breach of financial information
                                                                                                                                                                   wichtig
                                                                                                                                                                             nichts
                                                                                     möglichkeiten
                                                                                                                      eindeutig            wenig        weiẞ
                                                                                                                                                                                          gameforge
                                                                                                                                                   recht
                                                                                                                                                         dart
   • Intelligence
                agencies like NSA, BND, MI5 and their habit to                                                                                            besorgt
                                                                                                     steuergeheimnis             eingeführt         mache
     infringe on personal freedom
                                                                                                                          entgegen

                                                                                                                                                                                                                33
technology

                                                                        Title

                                                                          Jan 2018 Germany
                                                                              Total            Internet        Active social      Mobile       Active mobile
                                                                            population          users          media users     subscriptions    social uses

   Mobile phone use                                                        82.20             74.81             38.00           110.97          30.00
                                                                            million           million           million        million         million
   Germany has arrived at total mobile penetration                         Urbanization      Penetration       Penetration     Penetration     Penetration

   As of the beginning of 2018, there are more mobile phones in                 76%            91%              46%            135%             36%
   Germany than citizens. In fact, Germany now has 135% mobile
                                                                          Jan 2018 Global
   phone penetration (graphic one), which is interesting considering
                                                                              Total            Internet        Active social      Mobile       Active mobile
   that the country’s general internet penetration is only 91%.             population          users          media users     subscriptions    social uses

   While Germany is a global leader in terms of mobile phone
   penetration, the country still lags behind worldwide standards of
   active mobile social media use (graphic 2).
                                                                           7.593             4.021             3.196           5.135           2.958
                                                                                billion       billion           billion         billion         billion
                                                                           Urbanization      Penetration       Penetration     Penetration     Penetration
                                                                                55%            53%              42%             68%             39%
                                                                       Adapted from chart by We Are Social by Simon Kemp

                                                                                                                                                               34
technology

                                                                    Mobile Cellular Subscriptions per 100 People
                                                                                               Germany   UK   US   World   Europe & Central Asia
                                                                                               140

   Early diffusion of mobile phone use in Germany                                              120

   At this point, German citizens are among the heaviest mobile
                                                                                               100
   phone users in the world, according to The World Bank.

                                                                     Number of Subscriptions
   The seemingly paradoxical rate of 130 mobile phones per 100
                                                                                                80

   people (in 2009) was likely caused by the duplication of phone                               60

   subscriptions for both work and private phones.
                                                                                                40

                                                                                                20

                                                                                                 0

                                                                                                    16
                                                                                                    14
                                                                                                    12
                                                                                                    10
                                                                                                    08
                                                                                                    06
                                                                                                    04
                                                                                                    02
                                                                                                    00
                                                                                                    98
                                                                                                    96
                                                                                                    94
                                                                                                    92
                                                                                                    90
                                                                                                    88
                                                                                                    86
                                                                                                    84
                                                                                                    82
                                                                                                    80

                                                                                                 20
                                                                                                 20
                                                                                                 20
                                                                                                 20
                                                                                                 20
                                                                                                 20
                                                                                                 20
                                                                                                 20
                                                                                                 20
                                                                                                 19
                                                                                                 19
                                                                                                 19
                                                                                                 19
                                                                                                 19
                                                                                                 19
                                                                                                 19
                                                                                                 19
                                                                                                 19
                                                                                                 19
                                                                                                                                                   35
technology

                                                                       Average Monthly Data Volume per Mobile Subscription
                                                                               in Germany 2009-2017 (in megabytes)
                                                                                                             1000

   Exponential mobile data usage in Germany                                                                  800

                                                                        Data volume in megabytes per month
   Mobile data volume is growing at an exponential rate in Germany,
   with the average user set to surpass 1GB monthly use in 2018,                                             600

   according to data from Statista.
   What’s driving this rapid growth? Faster mobile internet                                                  400
                                                                                                                                                                            850

   connections have fuelled a significant growth in mobile app                                                                                                       591

   culture, as well as more widespread usage of image (e.g.                                                   200                                             404
   Instagram) and video (e.g. Netfilx) intensive apps.                                                                                                 289
                                                                                                                            52                  195
                                                                                                                     27                  114
                                                                                                                                   76
                                                                                                               0
                                                                                                                    2009   2010   2011   2012   2013   2014   2015   2016   2017

                                                                      Source: Statista

                                                                                                                                                                                   36
technology

                                                                    Top 10 Downloaded Apps Android vs. iOS (April 2018, Germany)
                                                                    Android users prioritize          iPhone users focus on gaming
   Most downloaded apps in the German market                        communication and social apps

   What are the most downloaded apps in the German market by           Top 10 Android Apps              Top 10 iPhone Apps
   category?                                                           1. WhatsApp Messenger            1. Harry Potter: Hogwarts Mystery

   • Communication (e.g. WhatsApp, Facebook Messenger, email,         2. Facebook                      2. Love Balls
      internet browser)                                                3. Google Play services          3. Helix Jump

   •G
     aming (Harry Potter, Love Balls, Helix Jump, MMX Hill Dash)      4. Google                        4. ApoRed - Das Spiel

                                                                       5. Google Chrome                 5. WhatsApp Messenger
   • Social (Instagram, Facebook, Snapchat)
                                                                       6. YouTube                       6. MMX Hill Dash 2- Race Offroad
   • Entertainment (YouTube)
                                                                       7. Instagram                     7. Instagram
   • Tools (Google Maps, Google Play)                                  8. Facebook Messenger            8. YouTube

                                                                       9. Samsung Internet Browser      9. Google Maps

                                                                       10. WEB.DE Mail                  10. Snapchat

                                                                    Source: SimilarWeb

                                                                                                                                            37
technology

   Germany lags behind in mCommerce
   Not only does the German eCommerce market still lag behind the UK, the German mCommerce
   (mobile purchasing) market also trails, according to data from ecommercenews.
   But, what is causing this gap? There are many factors contributing to this, but one of the major
   reasons is German risk-averse attitudes toward data security and mobile payments.

    Retail mCommerce Sales in Germany (2016-2021)                                                                               Retail mCommerce Sales in the UK (2016-2021)
            Retail mCommerce sales               % change        % of retail eCommerce sales                                            Retail mCommerce sales           % of retail eCommerce sales        % of total retail sales
             40b                                                                                                                         70b
                                                                                                                     $36b
                                                                                                  $34b                                                                                                                                          £62b
             35b                                                                                                                         60b
                                                                               $31b                                                                                                                                           £55b
             30b                                            $28b                                                                         50b
                                                                                                                                                                                                           £49b

             25b                         $24b                                                                                                                                           £43b
                                                                                                                                         40b
                       $19b                                                                                                                                          £36b                                                      50%               52%

                                                                                                                                Sales
                                                                                                                                                                                                           48%
    Sales

             20b
                                                                                                                                                                      43%                46%
                        42%                                                     40%               42%                42%                 30b       £27b
             15b                          37%                39%
                                                                                                                                         20b       39%
             10b
                       33%
                                                                                                                                         10b
              5b                          23%                                                                         7%
                                                             15%                                                                                                                                                               12%               13%
                                                                                12%                                                                7%                  6%                 10%               11%
                0                                                                                 10%                                       0
                       2016               2017               2018               2019              2020               2021                          2016               2017              2018               2019                2020              2021
            Note: includes products or services ordered using the internet via mobile devices, regardless of the method of              Note: includes products or services ordered using the internet via mobile devices, regardless of the method of
            payment or fulfillment; includes sales on tablets; excludes travel and event tickets. Source: eMarketer, Jan 2018           payment or fulfillment; includes sales on tablets; excludes travel and event tickets. Source: eMarketer, Dec 2017

   Charts adapted from visualizations from ecommercenews.

                                                                                                                                                                                                                                                            38
technology

                                                   Mobile Phone-Related Conversations in Germany
   Batteries improve and streaming
   goes mainstream                                                     2013-2015                   2016-2018

   Short battery life (‘akku’) has been a
   common topic of conversation in Germany
   for several years, but declining social media
   conversations about the topic suggest that it
   has become slightly less of a problem.
   At the same time, conversations about TV
   and video streaming have increased, while
   the app ecosystem has remained a relevant
   and popular topic.

                                                                                                               39
technology

   Home automation
   Home automation market is growing
   Compared to other markets (specifically US, Japan, and UK) the German IoT market is still
   underdeveloped. In 2016, less than 10% of German adults owned an IoT device - most likely
   a wireless speaker. However, the German IoT market is growing, mostly driven by B2C home
   automation devices.
   Among those, Amazon Alexa and Google Home have become catalysts for demand, connecting
   home automation with a convenient way of controlling connected home systems.
    Search Interest Over the Past 5 Years in the German Market                                   IoT Revenue Prediction (2010-2020)                                                       IoT Devices Owned by Internet Users in Germany (July 2014)
                                     Amazon Alexa         Google Home           Smart Home                                          50b
                                    100%                                                                                                                                                      Wireless speaker                   9%

                                                                                                                                    40b
                                                                                                                                                                                                Fitness tracker          4%

                                                                                                 Expenditure in billions of Euros
                                    75%                                                                                                                                                            Smart watch           4%
    Google Trends Search Interest

                                                                                                                                    30b                                                    Surveillance security
                                                                                                                                                                                                         system      3%
                                                                                                                                                                                   50b
                                    50%
                                                                                                                                                                                                 Connected car      2%
                                                                                                                                    20b
                                                          Amazon Alexa                                                                                                                        Connected home
                                                          launches in Germany                                                                                                                       appliance       2%
                                                          Sept 14, 2016
                                                                                                                                    10b                                     25b                  Smart lighting
                                                                                                                                                                                                                    2%
                                    25%                                                                                                                                                                system
                                                                                                                                                                     14b
                                                                                                                                                              9b                             Smart thermostat       2%
                                                                                                                                           4b          6b
                                                                                                                                      0
                                                                                                                                          2010         2012   2014   2016   2018   2020                        0%        2%    4%         6%     8%   10%
                                     0%
                                           Jan 25, 2015                           Oct 16, 2016                                                                                                                                % of respondents
                                                                                                                                    Source: Statista                                      Source: eMarketer

                                                                                                                                                                                                                                                            40
technology

                                                                        Home Automation Conversations in the German Market (2010-2018)
                                                                                         6k

   Home automation heats up in the winter                                              5.5k

                                                                                         5k
   Conversations about home automation in Germany seem to
                                                                                       4.5k
   follow a seasonal pattern, with peaks shortly before and after the                    4k
   beginning of a new year.                                                            3.5k

                                                                        Total Volume
                                                                                         3k
   While some of this seasonality is the result of traditional sales
                                                                                       2.5k
   patterns, a big part is also due to winter weather, when Germans                      2k
   are more likely to buy, install and talk about home automation                      1.5k

   technologies.                                                                         1k

                                                                                        500

                                                                                          0
                                                                                       Jan 2014   Jan 2015     Jan 2016          Jan 2017   Jan 2018

                                                                                                                                                       41
technology

                                                                       Home Automation Conversations in the German Market (2014-2018)

   WiFi speakers dominate home automation                                                            steuerung
                                                                                                                   smarthome
   Within the German conversation about home automation                                                     mufug
                                                                                                                 fax
                                                                                       software                                                                    connect
   technology, smart speakers (like those made by Sonos) are                                                     pi dect                                                     soundbar
                                                                                                          rasperry                                         musik
   especially dominant. Hifi stereo systems have long been an           homematic             iot cloud                              openhab gekauft
   important part of German households, but now many consumers                                                   sensorandswitch

                                                                                  ip         internet magenta                                     läuft

                                                                                                                                                           sonos
   are swapping them out for more cutting edge wireless versions.                                                                  problem

                                                                          funktioniert                                                    system
   After Sonos, Amazon (Alexa), Devolo (fast wireless systems),                          google                   telekom

   Telekom Magenta (ISP / smart home solutions) and Philips (Hue /                                   smart           tv                 box
                                                                                      echo
                                                                                             alexa                nutze    devolo                playbar
   connected lighting) flesh out the home automation conversation in   lautsprecher
                                                                                                                                         fritz
                                                                                                                                                     steurn
                                                                                                   app hue          router             lan
   Germany.                                                                           amazon                                        dlan wlan                 thema
                                                                                                                                                                      aktuell
                                                                                                                                                                                raumfel
                                                                                                  apple                geräte
                                                                                                          philips

                                                                                                                                                                                          42
technology

                                                                        Home Automation Conversations in the German Market (2014-2018)
                                                                                                   Germany      US/UK

                                                                                                   80%

                                                                                                   70%

                                                                                                   60%

                                                                         Total Volume
                                                                                                   50%

                                                                                                   40%

                                                                                                   30%                                         62%
                                                                                                   20%                  45%
                                                                                                               37%                    37%
   Germany is catching up in wearables                                                             10%

                                                                                                    0%
                                                                                                                                                                   8%        8%       4%
   The German wearables market is still underdeveloped compared                                                Smartwatch             Fitness band                 Smart glasses    Smart clothing

   to the UK and US, but it is growing significantly year over year.
                                                                        Wearables Penetration by Market (March-December 2016)
   Smartwatches and fitness trackers are especially popular,
                                                                                                   United States     United Kingdom         Germany       France         Italy
   according to PwC.                                                                               20%

                                                                                                                                                                                                     16%

                                                                         Market Penetration Rate
                                                                                                   15%
                                                                                                         12%                                                                                         12%
                                                                                                         10%
                                                                                                   10%                                                                                               11%
                                                                                                         8%                                                                                           8%

                                                                                                         5%                                                                                          7%
                                                                                                    5%
                                                                                                         5%

                                                                                                    0%
                                                                                            March 2016                  May 2016              July 2016            September 2016   November 2016

                                                                       Source: Kantar

                                                                                                                                                                                                           43
technology

                                                                            Search Interest Over the Past Five Years in the German Market
                                                                                   Fitbit   Smartwatch    Activity tracker       Apple watch

   Apple is driving the wearables conversation, but                                100

   Fitbit is gaining steam
                                                                                    75

   German interest in wearables has been continuously growing for
   several years. Apple (with its smartwatch specifically) has been

                                                                            Axis
                                                                                    50

   driving the conversation, but Fitbit is gaining popularity and carving
   out a growing market for activity trackers.                                      25

                                                                                      0
                                                                                            May 5, 2013           Jan 25, 2015                 Oct 16, 2016

                                                                                                                                                              44
technology

   Apple and Fitbit dominate German wearables
   market
   Within the werables conversation, Apple and Fitbit are the
   two dominant brands, followed by Samsung. As a result, user-
   generated photos of food, fitness, and performance tracking are
                                                                     Wearables Conversations in the German Market (2014-2018)
   becoming increasingly more common.                                                                                                    iphone
                                                                                                                             kaufen
                                                                                                                                      hätte

                                                                                                                                                  watch
                                                                                                                                   ipad
                                                                                                                                       series

   Common Objects in the Wearables Conversation
                                                                                                      apple
                                                                                                                                          zeit

                                                                                                                                          schön
                                                                                                                                                                                      fitnessmotivation
                                                                                                                                        frage smart

     17% Food                                                                                                                          armband
                                                                                                                                                   sport
                                                                                                                                                                   wocher abnehmen                     fitnesstracker
                                                                                                           app                                                                                 genau
                                                                                                                          handy                             charge
                                                                                                funktioniert
                                                                                                             tracker                                                                    fit

                                                                                                                                                                  fitbit
                                                                                                                                                                                         fitfamtraining
     14% Produce                                                             möchte
                                                                                      samsung
                                                                                            gear uhr
                                                                                                        super

                                                                                                                   zufrieden                      fitbitcharge2

                                                                                                       fitness
                                                                                                                                                                                          workout

                                                                                                                                                             gym
                                                                                                                               wearables                                              laufen
     8% Circle
                                                                                                                meinem
                                                                                                                                             android
                                                                                                                                                              motivation   schritte
                                                                                                                                                                                               applewatch
                                                                         smartwatch
                                                                                                                               glass

     6% Physical fitness                                                                                        smartphone             google
                                                                                                                                                  fitnessarmband
                                                                                                                                                                     wearable

     6% Person

                                                                                                                                                                                                                        45
technology

   Digital currencies &
                                                                        Search Interest in Cypto Over the Past Five Years in the German Market
                                                                                Bitcoin (payment system)   Ripple (payment protocol)   Blockchain (topic)
                                                                                100

   blockchain technology                                                         75

   Bitcoin dominates German search interest for
   digital currencies

                                                                         Axis
                                                                                 50

   In terms of cryptocurrency interest in Germany, it’s all about
   Bitcoin. The next on the list, Ripple, accounts for only about 10%            25

   of the search volume of Bitcoin, and blockchain has yet to make a
   real impact in Germany.
                                                                                  0
                                                                                May 5, 2013                   Jan 25, 2015                   Oct 16, 2016

                                                                                                                                                            46
technology

                                                                      Digital Currencies & Blockchain in the German Market (2013-2018)
                                                                                     25k

                                                                                     20k

   Social volume about digital currencies peaked in
   2017                                                                              15k

                                                                      Total Volume
   German online conversations about cryptocurrencies and
                                                                                     10k
   blockchain reached a peak in 2017 — when Bitcoin prices spiked —
   but have been declining ever since.
                                                                                      5k

                                                                                      0
                                                                                       Jan 2013   Jan 2014   Jan 2015       Jan 2016     Jan 2017

                                                                                                                                                    47
Executive Summary

                    48
Executive Summary
Social & Political Trends                                                 Transportation
• The last German election has resulted in a more complex and            •#
                                                                            Dieselgate was the biggest scandal within the German automotive
   fragmented political landscape in Germany, and the public opinion       industry in the last decade and has generated more than 65,000
   about Chancellor Angela Merkel, reflected in her social sentiment,      conversations on German public social media from October 2015
   has been declining over time, mostly driven by her controversial        through the time of writing this report.
   immigration politics related to the Syrian refugee crisis.
                                                                          •A
                                                                            lthough the Volkswagen scandal affected up to 12 million diesel
• Immigration and social injustice are the two biggest political          cars in Germany alone and cost the company more than $30 billion,
  topics in Germany at the moment. Although the backlash against           social conversation and stock prices suggest that the company has
  immigration is driving an increase in right-wing votes, especially in    largely recovered.
  Eastern Germany, the topic remains mostly undiscussed online and
  appears to be a ‘silent issue’.

•B
  rexit-related conversations are slowly declining, while worries
 about Donald Trump and Germany’s relationship with the US are
 rising.

                                                                                                                                               49
Transportation (cont.)                                                   •W
                                                                           ithin the topic of hybrid cars, fuel cell technology appears to be the
                                                                          most promising alternative to traditional engines.
•D
  iesel car sales declined 21% for Q1 2018 YoY in Germany.
                                                                         •G
                                                                           erman auto brands aren’t considered leaders in conversations
•G
  erman car buying conversations show a relative decrease in             about the future of transport. The Prius, manufactured by Toyota, is
 purchase intent for VW compared to rival brands Ford & Fiat,             the most discussed sustainable model.
 indicating a longer-lasting damage of reputation for the VW Brand as
 a result of the scandal.                                             • The first German brand to follow is ironically Volkswagen, with less
                                                                         than half (1,328 vs. 2,877 for Toyota) conversations mentioning
•W
  ith only minor YoY sales changes for 2017 vs. 2016, the VW brand      future of transport.
 remains the biggest car manufacturer in Europe, with slightly over
 1.7 million cars sold in Europe alone.

•B
  oth electric cars as well as electric bicycles are experiencing a
 significant uptrend in interest in the German market, with e-bikes
 averaging double the amount of search demand as electric cars.
 High prices and a lack of technological infrastructure are preventing
 electric cars from being commercially viable on a large scale.

•C
  ompared to other engine technologies, hybrid appears to have
 the highest potential to become the next engine standard for future
 transportation based on German search behaviour.

                                                                                                                                                     50
Technology                                                              •S
                                                                          hort battery life for mobile phones is declining as a conversation
                                                                         topic, while TV and video streaming are growing.
•S
  earch based interest in privacy and data protection related topics
 shows a 15 year all time high with most of that trend being driven by • The German IoT market is growing but is still underdeveloped
 current changes of regulation (GDPR / DSGVO).                            compared to other markets, especially the US, Japan, and the UK.
                                                                          Less than 10% of German adults owned an IoT device in 2016.
•W
  hen comparing UK search trends with those in Germany, we can
 see that the topic of data protection generally receives about 60%    •O  ver the last five years, the German interest in wearables has been
 more attention in Germany than in the UK.                                continuously growing with Apple and Fitbit driving the market,
                                                                          selling mostly smartwatches and activity trackers.
•G
  erman “angst” about privacy violations and breaches of data
 protection are mostly related to topics revolving around data         •B  itcoin is dominating interest in German searches whilst other
 and identity theft, violations of personal privacy, infringement         cryptocurrencies fall largely short of similar interest.
 on sensitive person-related data (e.g. medical or bank records),
 breaches of fiscal secrets as well as behaviour of intelligence
 agencies.

•M
  obile data usage is growing at an exponential rate in Germany,
 likely to surpass 1GB average monthly data use in 2018. However,
 Germany is still trailing the UK in terms of mobile commerce.

                                                                                                                                                 51
Appendix

           52
technology

   Our Approach: Framework-Driven Digital Insights
   We deploy a host of services, frameworks and techniques. How can we add value for you? Contact us: hello@braingraph.com

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               Audience                                     Competitive
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               segmentation                                 benchmark
                                                                                                        analysis

               Market opportunity                           Digital growth                              Digital traffic and
               analysis                                     analysis                                    revenue forecast

               Digital UX and                               Digital trend                               Digital innovation
               performance analysis                         analysis                                    analysis

                                                                                                                              53
technology

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                                                                                                                                          54
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