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BizReport : Mobile Marketing : May 04, 2018


Forecast: App spending to top $150b mark

For the next four years, experts believe consumers will spend at least $156 billion in mobile app stores - that is a 92% increase from what consumers spent in 2017. In 2018, alone, the app spend is expected to skyrocket to just over $106 billion.

by Kristina Knight

According to AppAnnie, this growth rate comes as the app market moves from first time downloaders who are experimenting with the kind of apps they want on their smartphones, into a more mature downloading base who not only know what they want, but who know what they are willing to pay to play - not only for that first download, but for in-app purchases.

"APAC is driving nearly two-thirds of the global spend as China remains the world's largest market, hitting $62.4B, or nearly 40% of worldwide spend," write the report authors. "We forecast the install base of smartphones and tablets to expand from 3.9B at the end of 2017 to 6.1B in 2022. Global average spend per device is projected to rise from $20.94 in 2017 to $25.65 in 2022. Annual average spend per device in Japan will exceed $140 by 2022 -- this is nearly 6x the global average and by far the highest in the world."

In fact, China is expected to lead the work in app downloads through 2022; Chinese consumers, along with those in India are a newer app marketplace will increase their downloads by 51% and 208% respectively.

Meanwhile, consumers in the US and Japan, as more mature marketplaces, will see download rates stabilize, averaging between 15 and 20 new downloads per year per consumer.

As to how the app spend will break down, US consumers are expected to account for roughly $60 in downloads over the course of a year; that is a 50% increase in app spending. APAC consumers are expected to spent about $100 per device, and EMEA consumers are expected to spend about $20 per device by 2022.

"In maturing and increasingly competitive markets, publishers need to encourage new app downloads through product innovation and investment in organic and paid installs. This will
likely require new approaches to UA. Growing spend per user should boost ROI and LTV of customers," write the report authors. "In emerging markets, high downloads and limited direct spend will make alternate strategies that rely on large user bases more effective. In-app advertising is an obvious model, but having a widely used app in these markets could also be a boon for brand awareness and loyalty. By 2022, APAC will account for 64.8% of app store spend, and 72.4% of global downloads. Over half of this will come from China alone. Domestic publishers are strong in APAC and given the huge opportunity, effective localization and careful local partnerships can help international publishers break through."

The AppAnnie forecast suggests games will continue to lead the way into app spending, but the experts say not to discount subscriptions.

Tags: app forecast, AppAnnie, mobile app spend, mobile commerce, mobile marketing, mobile spending forecast










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