This past May, four out of the top five downloaded apps for the month for both iOS and Android in the US were owned by Facebook. That is 62% of all apps, according to industry reports.
A staggering statistic and very important to consider if you are creating a business reliant on a mobile app. Getting and maintaining attention is becoming increasingly difficult and expensive. How can you cut through and ensure you will get a return on your investment? Is it worth it?
I believe it is and I like to use the analogy of the modern music industry to describe to my clients where the opportunities lie.
Just as we have most of the top 10 apps on our phones (at least two social media apps, a few messaging apps, a photo sharing app, a search app, a video and music streaming app and a game or two), we are all familiar with the artists that dominate the top of the charts regularly (Taylor Swift, Justin Bieber, Rhianna, Drake etc). We have been exposed to both apps and music through mainstream media and our work colleagues/friends.
But when you look the next 20 apps on your phone, they start to diverge from your friends around you. The choices you make at this level communicate something much more subtle and personal about you and your preferences. Where you bank, what sports you follow, what niche social networks you connect with, what style of games you pass the time with etc.
The story behind how we have been exposed to these apps tends to be more idiosyncratic: niche media, family, close friends or chance encounters. A trawl through your iTunes playlists or record collection would describe a similarly personal story. Not everyone knows who Alt-J or Keith Jarret are but it says as much about you as whether you pass the time on the train purchasing clothes from The Iconic or ASOS apps or play Crossy Road of ThumbDrift.
The revenue streams of the top apps and artists is significant, well managed and diversified with strong strategic support and numerous partnerships benefiting in the success. Also, not unlike the network of top VC firms in Silicon Valley that nurtures and supports startups into unicorns, the music industry infrastructure amplifies (pun intended) a successful artist into a ubiquitous one.
While the financial gap between the top and lower tier apps and artists has never been wider, the opportunities to leverage the exact same production quality and distribution networks means that if you do your own diligent, careful and deliberate customer discovery, a profitable and worthwhile business is achievable.
This path to a sustainable business within the app economy or music industry is lined with the bodies of the burned-out and dejected. The ones who persevere do it by keeping things simple and focussing on their fans/customers.
Scott Galloway of L2Inc has predicted that Facebook, which is now 20% of the internet, will be the internet and the internet will just be the underlying technology. While that may concern some, I do not believe it to be the end of app diversity or the death of the app economy just as the latest Beyonce magnum opus will not replace all other music available to us.
By QT Mobile head of partnerships and products, Michael Correa