Mobile apps: Local supply, global demand
An unprecedented combination of factors has converged in recent years to drive the focus of mobile app developers away from an exclusive, naval-gazing focus on their own home countries. We’re now at a point in which a teenager who develops a mobile game in his room in Singapore, then releases that game into the various app stores of the world, will have downloads from Portugal to the Philippines by the end of the evening. Gone are the days in which he’d have counted primarily on downloads from his own country, then chalked any additional business registered elsewhere in the world as a nice surprise. The combination of powerful, low-cost Android smartphones and advanced mobile networks in the developing world is leading to rapid upgrade cycles, from feature phones to smartphones, and this is quickly increasing, evolution in both the app universe and the mobile ad tech ecosystem.
If our hypothetical game or app developer is looking to monetise his game or app through advertising, he’s going to want to make sure they can reach these new global users with highly targeted, relevant ads. He might have considered developing a premium, pay-per-download app, or perhaps one that was initially free but that leaned heavily on in-app purchases to drive revenues. The thing is that in the new world of local supply and global demand, these models aren’t fit for everyone. His game might be quickly buried within the app stores under an avalanche of similar games and apps, no matter how innovative or groundbreaking it might be.
So he’s decided to monetise via in-app advertising instead. His new customers in Venezuela and Vietnam will want to see highly-targeted, language-specific display, native and video ads that are relevant to them, and not merely to our app developer in Singapore. Grabbing their attention via targeted ads is especially important as most users within emerging markets are discovering the vast universe of mobile apps and games for the first time. When they’re marketed to at all, they’re keen to be marketed to by brands and in languages that they can easily act upon with a click.
By 2020 it is expected that the world will have 4.6 billion unique mobile subscribers, representing nearly 60 per cent of the global population. In Asia-Pacific alone there are 1.8 billion unique mobile subscribers, and that figure is set to grow at a CAGR of 5 per cent annually to 2020.. This growth in emerging economies is also fueling an unprecedented expansion of the middle class, which in turn facilitates soaring consumer spending on goods and services. It’s music to the ears of any aspiring app developer, no matter where they happen to be developing.
To be sure, our hypothetical Singapore-based developer’s users around the world are addicted to the same set of core apps in their markets as he and his friends are in his. The walled gardens of Facebook, Twitter and others will no doubt stand for some time, and continue their vertical dominance in markets everywhere. However, one only needs to pull out a smartphone and take a look at the home screen: these are only two of the many icons available for placement there. Most users may have somewhere between ten and fifty – or more – to choose from. The mobile world, and especially the global app ecosystem, completely democratizes this universe. Remember Flappy Birds? It was actually taken down because the attention was too great. This would be an almost unfathomable move for any desktop publisher, ever.
It’s clear that we’re now starting to see “real” money spent specifically mobile-first. Advertising budgets are beginning to consider mobile as a, and sometimes the, primary channel. The next Flappy Birds is continuously around the corner. The only way to keep up with the rising tide is with global, independent, mobile-first integrated platforms that easily connect these local publishers to the seemingly endless global budgets trying to find them.
