china and the app economy
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Overview of China Market, Facts about appstores: "Where the apps are," Mobile ad spending- whats ahead, research about consumer appsTRANSCRIPT
China and the App Economy
1
Photo Credit: SocialMediaSEO.net
Outline
• Overview of China Market
• Facts about appstores: “Where the apps are”
• Mobile ad spending – what’s ahead
• Research about consumer apps
Introduction to China’s Mobile Market
• 1,023.7 million mobile subscribers (April 2012)• 76% of China’s population
• 3 x larger than USA mobile subscriptions
• 159.3 Million 3G users (April 2012)• 15% of China’s mobile subscribers, global average is 20%
• China’s 3G market grew 28% from Nov. 2011 to March 2012
• 22% of global smartphone shipments in 2012 Q1
3 Source: MobiThinking
“By the end of this year, China will have 350 million smartphones, that’s more phones than there are people in the
US.”- Alvin Graylin, CEO of mInfo
China’s Unique App Economy
• 80 million new subscribers annually for the past decade
• 40% of internet users connect solely via a mobile phone
• Historically, Chinese have been reluctant to pay for apps
• 62% of iPhone owners have purchased at least one app
• 23% of Android users have purchased at least one app
• A taste for localized content
• Nearly 50% of China’s top 25 apps are in Chinese
• 65% of top 300 free apps are regionally popular only
• Only 20% in USA and Europe
4 Sources: TechCrunch,, BBC and App Annie
8 Source: Stenvall-Skoeld
China’s App Store Data
Apple’s Chinese App Store
Strengths
• 25 billion apps downloaded worldwide
• China has 2nd highest iOS app downloads in the world
• App store revenues grew 213% in one year (May 2011-May 2012)
• Downloads increased 305%
• iPhone has 19% market share
Weaknesses
• Despite high quantity of downloads, ranks 8th in total revenue generated
• Piracy and jailbreaking of the iPhoneare rampant
• Allows users to download paid apps for free
• In China every iOS app download generates $0.03
• Every US download generates $0.28
7 Source :PC Advisor
China Mobile’s Mobile Market
• Launched in 2009
• World’s largest mobile phone operator
• 640 Million phone subscriptions (Jan. 2012)
• Activity– November 2011
• 30 Million downloads• 87% under 3 RMB ($0.50)
• Avg. price: 2 RMB ($0.30)
• Avg. game price: 6.3RMB ($1.00)
– January 2012• 150 Million Mobile Market users
• 120,000 games and apps
• 490 million downloads
5 Source: The Next Web
China Mobile’s New Mobile Market
• Previewed July 2012
• Set to launch September 2012
• China Mobile to take 50% of revenues from sales, compared to
Apple’s 30% revenue share
• Will integrate searches from other app stores
8
Source: Gomo News6
Nokia’s OVI Store • 120 million registered customers
• 120,000 apps
• 15 million downloads per day
• 90% of users access in local language
• Top-5 Apps Globally in 2011
– Facebook Chat
– eBuddy Messenger
– WhatsApp Messenger
– High Speed 3D Free
– Skype
9 Source: Nokia
3 Source: Stenvall-Skoeld
China’s App Store Revenue Forecast
China’s Mobile Advertising
• Potential to reach over a billion people
• Compare to 300 million with internet ads
• Most effective mobile ads combine 3 factors:
• Social Media
• Mobile Phones
• Location-Based Services
10
Source: eMarketer
China’s Mobile Ad Spending
Commissioned mobile market research
• Surveys conducted in May/June 2012• Focused on casual dining restaurants• 500 respondents in Tier 1, 2, 3 cities
Have you used the restaurant’s mobile app?
62%
22%
10%6%
Percent of respondents (max = 100%)
No, I don't know there is one
No, haven't had the chance to
Yes, on my mobile
Yes, on someone else's mobile phone
If you were to design the restaurant's mobile app, which of the following features would you include? Please select top 3.
0% 10% 20% 30% 40% 50% 60%
Mobile ordering for at-home delivery
Receiving special offers and other rewards, as a member of the loyalty program
News of other coupons and special offers
Ability to purchase restaurant's gift cards or e-coupons for your family & friends
Payment for your order, in place of cash or a debit card
Mobile ordering for in-store pick-up
Product Information about restaurant's foods and beverages
Maps, directory or locations
Games, and other fun activities
Max = 100%
Percent of respondents (top 3 choices allowed)
When dining at the restaurant, would you check-in on your mobile phone to share your location and: _____________ ?
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
Earn points for current or future rewards from the restaurant's loyalty
program
Receive discount/offers for your current or next visit to any of
restaurant's locations
Share discounts and offers received via checking in with your friends via social
networks, like Weibo or RenRen
Max = 100%
Percent of respondents (more than 1
choice allowed)
If you joined the restaurant’s loyalty program, what kind of information would you be prepared to offer to help it personalize the rewards you received?
Percent of respondents (more than 1 choice allowed)
Max = 100%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Mobile phone number
Name
Your birthday
Gender
Favorite products
Postal / Email address
Number of family members
All of the info
None of the info (below)
If another similar restaurant you frequented had a loyalty program that you could join offering with special offers, exclusive events, and other privileges, would you be: ___________________ ?
40%
38%
22%More likely to increase the amount you ate at the other restaurant, but continue eating at McDonald’s about the same
Likely to increase the amount you ate at the other restaurant and decrease the amount you ate at McDonald’s
Continue eating at the other restaurant and McDonald’s about the same as before
50%
35%
15%
More likely to increase the frequency of visit to the other restaurant, but continue eating at Pizza Hut about the same
Likely to increase the frequency of visit to the other restaurant and decrease the frequency of visit to Pizza Hut
Continue visiting the other restaurant and Pizza Hut at about the same frequency as before
China’s Mobile Future
“Don’t look to Japan or Korea to see how consumers will
be using technology, or to the U.S. or Europe.”
“China is the hotbed for how consumers will live in the
global world going forward – and it’s all about mobile.”
– James Fergusson, Global Head of TNS
19 Source: eMarketer
This presentation has been prepared by:
Shanghai Headquarters
Bridge 8, Building 9, Unit 9605 No. 25 JianguoMiddle Rd., Luwan District200000 Shanghai, China
Austin headquarters
1300 Guadalupe St., Ste. 201
Austin, TX 78701
For more information please contact: [email protected]