Mobile App Economy 2016

The Mobile App Economy in 2016 – Downloads, Inventory, and Categories

App Development Mobile Technology

 

2015 marked a year of revolution in the mobile economy, with more than 600 million people purchasing their first smartphone. In the world we live in today people rely so much on smartphones for socializing, shopping, browsing, entertainment, and work while on the go.  In fact, by the end of 2016 more than 50% of the global population will have access to smartphones and Internet. It is estimated that by 2020, 6.5 billion people will own a smartphone. This rapidly growing mobile economy has opened up a multitude of opportunities in potentially vast untapped markets for global brands and marketers. A recent report by TUNE provides information on the changes happening in the mobile ecosystem and gives an outlook for the mobile market.

What is changing the mobile economy?

Smartphone users: 2015 alone accounted for 800 million smartphone purchases, both in developed and developing nations. 47% of the global population had a smartphone by the end of 2015. Ericsson estimates that in 5 years roughly 80 % of the global population will have access to smartphones.

App Inventory: As ownership of smartphones becomes commonplace, app developers are more encouraged to bring innovative apps to the marketplace to increase growth. 600,000 new apps and games are expected in 2016.

App Downloads: In 2020, the total app downloads across all the app stores are expected to cross the 370 billion mark, a growth of over 200 billion from 2015. The number of downloads worldwide is set to increase rapidly over the next five years, owing to the emerging markets in Asia. However, some developed markets are seeing a flattening in the download curve. Marketers are challenged to find new ways of getting new installs or face abandonment by users. The slowdown is limited in scope but still a concern among app makers.

Rise of BRIC Nations: 2015 saw the BRIC nations (Brazil, Russia, India, China) register a 100% growth in installs over 2014.  By 2016, these young markets will account for more than one-third of TUNE’s mobile tracking events.

Games: More than half of data analyzed comes from gaming companies. Game developers can see how players evolve and know how to engage them. They have mastered user acquisition and engagement. Developers can define player attributes and segment groups to maximize ROI and ad spend.

Billion App Downloads: Looks like Facebook and Google own this space with number of downloads. Facebook, Facebook Messenger, WhatsApp, Youtube, Gmail, Google Maps, Google Drive, and Google Search all with over a billion downloads.  There are also several games that broken this milestone.

What kinds of apps do people download?

Games: All the countries averaged above 40% installs according to data by TUNE. Germany leads at 70%, with Brazil, Malaysia, and Australia above 62%. USA and Russia stand at a little above 50%. China game downloads reached approximately 45%.

Social Apps: Japan leads the pack with 15.5%. Taiwan with 8.1%, Australia with 5.8%. Saudi Arabia and USA stand next with 12.8% and 10% respectively.

Music: Mexico ranks comfortably higher than the rest of the world with music apps contributing 8% of the total app downloads. Spain about 4.5%, Brazil and Russia around 4%; Germany, Korea, and USA stand around 3.8%.

Travel: China has almost 10% of the total app downloads, Spain at 9%, Korea with 8%. Followed by USA with 6%, Australia and UK at 5%, Japan at 4%, and Russia with 3.5%. In most countries a majority of travel apps are downloaded on iPhone and this probably income related. The U.S. was the only outlier because of the high number of premium Androids.

What are some country-specific characteristics?                

USA

While 30% of the app data came from the United States, the US represents a very balanced market in terms of the competition between Android and Apple iOS. Both with an equal number of smartphone users, this is something unique and has not been noticed in any other region. Key factors in the American market include constant innovation, huge competition, and lots of rewards. App makers that win in this market make the biggest paychecks.

INDIA

India is destined to become the most populous country in the world by 2022, according to the UN.  It’s rapidly growing consumer base makes mobile commerce a huge opportunity. Shopping giant Flipkart states that 70% commerce comes from mobile. In fact, Flipkart has a mobile only strategy to transact business. Aside from mobile commerce, Indian love entertainment making it entertainment download leader of the world by a big margin representing 14% of downloads, while second place goes to USA and France with 4.5%.  Indians prefer a nice lifestyle as it leads in Lifestyle app downloads with 11.5% followed by Korea with 7.5%.

BRAZIL

Brazil is another fast growing economy with 70% of smartphone users using an Android. Tool and utilities downloads makeup about 7%.  Thailand and Philippines are also about 7% However, Brazil’s legal and political system is very challenging and local partnership is essential.

CHINA

China has the highest percentage of organic downloads worldwide at 96% and Spain following with 94%. China’s smartphone penetration is nearing 50% with 670 million smartphones and consumers are now changing their buying behavior and opting for premium phones.

In brief, the mobile app economy does present an opportunity but comes with risk. For every new app added to the marketplace, it becomes increasingly more difficult to stand out in the crowd. App makers realize that in order to boost metrics and ranking, paid advertising should be part of the marketing strategy. Better search ranking gives better visibility and increases organic downloads.  2016 makes analytics an indispensable tool to maximize user acquisition and engagement, paving the way for sustainable profits.

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