China or India? Brazil or Mexico? The United States or the European Union? How do you determine the markets you should enter? That there are many variables to consider is an epic understatement. The points addressed here can help anyone identify their best market opportunities. This article is the first part of a white paper being prepared to support indications that only a minority of developers engage in marketing, and even fewer do market analysis. And yet it’s not difficult, by the time we’re finished — it will be pretty easy.
Freely available data sources are referenced wherever possible. Some data will require personal research and may not be readily available. Still, there is enough information readily available online whereby anyone can get a good rough idea of where to concentrate their efforts without knowing a lot about marketing.
Important for future perspective and helping to understand some of the broader dynamics in play. Total country population is relevant only as it is likely to influence where you start looking to market your apps. Bigger countries = bigger markets, right? Well, maybe.
Find Country Population:
It’s impossible to dismiss the importance of average income when it comes to evaluating prospective markets to target. There are several factors to consider.
The two simplest components are average income and purchasing power parity. Average income in US Dollars is typically defined by a country’s GDP divided by its population.
Purchasing power parity equates those US Dollars to what people can buy locally. A good point of reference for this is the Big Mac Index – measuring the cost of a Big Mac in different countries around the world. In Norway, a Big Mac is over $9.00, but in China might be less than $2.50. In essence, the app you are trying to sell to the North American Market for $3.00 won’t make headway in most other markets at the same price. This gets into market and price segmentation.
Some countries have a purchasing power parity significantly better than its GDP may indicate. Income influences pricing and price can dramatically influence interest in a premium app, freemium upgrades and costs of in-app currency.
There are a LOT of other factors appropriate to mention, though most of them apply to fine tuning marketing campaigns. Wealth distribution, unemployment rates, urban vs. rural population and wages, discretionary income, seasonal spending trends, etc. can all be useful points to consider.
Find GDP per capita:
Find countries by Purchasing Power Parity:
Finding the approximate number of devices and mobile subscriptions by country is relatively easy. It is essential to factor in the number of people who have multiple devices and mobile subscriptions. In the United States, it might sound like everyone has a mobile device. More accurately, the average US mobile user has more than 1.5 devices – reducing the eligible market to about 238 million people. Determining unique users is more difficult and in the absence of research results may require you to make an estimation.
Find number of mobile devices by country:
Many countries have more than one common language. Overall usage levels require research to determine the extent of overlap. Within our global environment, many languages carry weight far beyond national borders. Ignoring immigrant and diaspora communities dismisses some key language-specific revenue sources, frequently wealthier than their native communities.
If you develop and localize an app for a specific language, it makes sense to examine all of the countries in which the language is spoken. Additional localization components may be necessary.
Most Spoken Languages:
Languages by Country:
Playing a major role in breaking out likely users, age and gender both have an impact on app usage tendencies. Age (income and wealth distribution) tends to have the strongest impact on overall credit card holding rates.
We are talking in terms of averages here – broad classifications to which there will always be exceptions. The two oldest age groups (55-64 and 65+) can mostly be factored out of calculations, or given reduced weight in calculations. Likewise, the youngest age group (0-14) will not have credits cards and only developed markets will have any appreciable number of credit card holders in the 18 – 24 age range.
Demographics by Age & Gender (and a lot more):
Outside of developed markets, credit card usage can vary widely and the same applies to the ever expanding field of alternative payment systems. If you have a paid or freemium app, or one that allows the purchase of in-app currency, you need to have payment systems that match those available to your end users – customers.
Credit cards are the standard for most developed countries, typically working in conjunction with services like Paypal. Mobile phone payments like M-PESA in Kenya are showing signs of real growth, but frequently require an in-country presence for a business to establish an account. The proportion of people within a country having access to these payment systems requires research and that data is not always readily available.
Initiatives by Visa and MasterCard can be expected to substantially increase Africa’s market share in the years ahead. Developer-level partnerships can also pave the way for more effectively accessing developing markets, too. For example, if you or a trusted partner has an account able to accept mobile phone payments within a country can make a world of difference in your marketing strategy and app’s profitability.
One source of useful credit card information can be found on the Visa site:
Credit Card Market: Economic Benefits and Industry Trends by Scott Schmith
With all of the above factored, you are getting closer in defining your app’s target market. Your next step is to determine what portion of the market is using the combination of platforms and devices compatible with your app, i.e. Android, iOS, Nokia, Java or HTML5, and the like.
Awesome Resource for PC and Mobile Statistics:
Enough data is available to indicate that users of specific devices have preferences for specific types of apps – education and learning vs. travel or utility vs. gaming. Just within the games category, there are all kinds of genres, from strategy to puzzle, shooters and adventure.
There’s no single source of data for this kind of information. Different networks have their own statistics and what might be said for Apple devices tends to be quite different for Android.
These factors, 3 – 8, are primary factors in determining the overall number of people within a given market or country who might be interested in your app. This provides you the upper ceiling for your app.
No two campaigns are exactly alike. What you are able to establish through collecting the information in this article will go a long way toward establishing your total market. Reaching your market — well, that’s another story and will be treated in the second installment. Feel like experimenting? You can add your app to the Opera Mobile Store or begin your own advertising campaign in minutes.
Many, many more factors go into setting up a proper marketing campaign. Some campaigns seek to saturate the market; others aim to pick up maximum customers with a very limited ad spend. And there’s everything in between.
Of interest is your ability to better compete with the bigger players — development companies that do have a dedicated marketing team.
Be Everywhere. Everywhere you go, there’s a McDonald’s there, or a Walmart, sometimes a 7-11, a Circle-K, a BP Station, or a Safeway. Chain stores exist for a reason. Amazon.com is trying to go everywhere for a reason. Many companies set up affiliate programs for even more points of presence… for a reason.
Five Benefits of Multiple Store Distribution:
* market reach and potential for market share
* more selection in choosing “where to focus”
* building brand name recognition
* developing customer and networking relationships
* diversification for long-term revenue potential
Companies come and go, just as people shift between them. Market share fluctuates as new technologies emerge and older ones bite the dust. Market share also changes as new markets are brought up to speed.
Some developers take the approach that Google’s and Apple’s app stores are all that matter. That’s like saying, “Our products will only be sold in Walmart… or Sears.” Okay… But really, it is worse than that. It’s like setting up a sales booth right next to 100,000 other mobile app developers. That strategy can and does work for the top developers. Even for them, it’s sub-optimal – but that’s relatively good news for everyone else.
The more places that carry your product the more customers you *can* reach. This is true for brick-n-mortar, it is true for the Internet, it is true for mobile.
Why would you not want to have your product/s in the hands of more customers? Probably not. There are ONLY three reasons why a company would not. First – exclusivity, the value of your product is tied directly to the “relative” prestige of the “few people” who do have it. Second – your company is overwhelmed servicing its existing customers, so you scale back growth as you bring on and train more support personnel.
The third reason – the cost of doing so exceeds your ROI. With Mobile Apps – that’s not a factor.
You are dealing with an electronic product that involves no physical storage space, no shipping and handling, no physical packaging, no hard copy marketing materials AND most importantly – virtually NO BARRIER TO ENTRY!!! Let’s add a few more of those!!! And a few more!!!
Compared to the process of getting a physical product to market – Electronic Products — Digital Downloads ROCK. With brick-n-mortar, there is an arduous process of convincing distributors and retailers to carry your product and give it some shelf space in their stores.
Online vs Offline Shelf Space In a brick-n-mortar store, you are dealing with shelf space. Online, you are also dealing with… shelf space, essentially. The BIG Difference is that most physical stores have physical limitations; online stores have virtually no limitations.
The more products that are offered in any store, the lower the conversion or buy rate for any given one will be – unless it is in some way a featured product (Most Popular or Newest), on sale or running with some other kind of promotion.
So, it is easy to get into the online market — not so easy to get on the most viewed shelves. It is up to developers to arrange a way to get their app into the “best shelf space” – especially if the products are being offered for “free”. Why would a store give your app “special exposure” over any of the 10,000’s of other apps?
That’s one of the major differences, presently not very well understood within the mobile app developer community – that sales and marketing is NOT a passive effort. UNDERSTANDING THIS immediately places you at a MAJOR ADVANTAGE over most of your competition. The more attention to actively promoting your product is what will move it.
Even if placement of your product on a store yields few downloads, that’s more than you would have had. Some developers think it is the store’s role to push their app – and to some extent it is. Most usually, store’s promote products in near direct proportion to the extent the developer is promoting it and makes that known to the store managers. This is one reason for this blog – to provide you an additional, easy way to communicate with Opera Mobile Store. Let us know what you are doing!
Concurrently, being on multiple stores gives you the potential to sequentially stagger your promotional efforts to get the low hanging fruit of each store’s “power users”. User distribution by venue (store/advertiser) deserves another article. It is sufficient to say here that some portion of any given audience (3-4%) are frequently downloading and trying out new apps; another 15 – 25% are regulars… there’s the median group and lastly the hardest to reach.
Many of the points above also deserve further elaboration, but I will bring this to a close and remain open to any questions you may have about anything covered.