If your has a global appeal and you plan to increase your mobile revenue, marketing your to emerging markets could be the key.

Why should you consider targeting Emerging Markets (EMs)?

As per the 2016 App Annie Forecast Report, emerging markets will account for 76% of the global mobile app store downloads and 45% of the global mobile app store revenue by 2020.

Emerging Markets mobile app revenue

But which are these emerging markets? The largest emerging markets in terms of downloads and revenue growth are China, India, Brazil, Russia, Mexico, and Indonesia.

In fact, China has already become the largest market in the world for App Store revenue as per the Q3 206 report by App Annie.

And India surged past the US to become the largest country by Google Play downloads in 2016. Despite hitting that remarkable milestone, the smartphone penetration in India is still at 30% leaving an enormous potential for growth.

Using Market Maturity Model to Understand Emerging Markets

The best way to grasp this potential is by studying App Annie’s Market Maturity Model.

emerging markets maturity

The gray vertical bar in the model represents the global average for where mobile app market exists today. App downloads have nearly peaked, usage is increasing, and revenue is about to rapidly catch up. | Source: techcrunch

Mature markets like the U.S. and U.K. are to the right of the gray vertical line. App downloads are leveling off as these markets reach smartphone saturation, but usage and revenue are continuing to rise.

In comparison, emerging markets are to the left of the line. As more users get online for the first time, downloads are skyrocketing.

50% of Google Play’s year-on-year download growth was driven by India, Brazil, Indonesia, and Mexico. It is only a matter of time before usage and revenue catch up—by 2020, 45% of global app revenue will come from emerging markets.

Leverage Low CPIs in Emerging Markets to Acquire App Users at Low Cost

Also, the Cost Per Install (CPI) is currently lowest in emerging markets. So, if developers can invest in user acquisition in emerging markets now, they can build their future audience at the lowest possible price.

If we look at the image below, the CPI is the highest for Japan and US at $2.81 and $2.49 respectively. Whereas, for emerging markets like China and India it is at $0.86 (1/3rd of US) and $0.38 (1/6th of US) respectively.

CPI per country

CPI for games across countries – Emerging markets have the lowest CPIs currently | Source – All Correct Game

Why Can’t I Use My Current Marketing Strategy in Emerging Markets?

Your current app marketing strategy in developed countries will not work in emerging markets due to widespread differences between the two markets.

Firstly, in EMs Android is the dominant operating system with an average market share of nearly 90% due to the availability of low-cost affordable Android smartphones. iOS lags behind at a measly 3%.

Emerging Markets mobile app differences

Secondly, mobile data is still quite expensive in developing economies. The average cost of 500 MB of data ranges anywhere from 6 hours to 17 hours of work (2-6x) in emerging markets as compared to 3 hours in the United States.

In fact, users manually disconnect their from mobile data when away from WiFi and not in use. This also helps in saving battery life which is again a precious resource on low-cost phones.

Data cost emerging markets

Moreover, mobile data is slow and unreliable as the spread of 4G networks is not extensive. 60% of the total mobile connections worldwide are still 2G.

Data speed emerging markets

60% of the total mobile connections worldwide are on 2G

Lastly, a majority of the smartphones are low-cost with limited storage space available.

In fact, according to a Jana survey, 28% of the users in India complained that apps took too much space on their devices. Thus, app size plays a major role in deciding which app stays on the mobile phone.

How to Go About App Marketing in Emerging Markets?

Looking at the App Maturity Model above and the significant differences between Developed and Emerging markets, developers need to tweak their marketing strategy to be more relevant.

The following app marketing strategies taken by some of the most popular apps in the world can come in handy for emerging markets. (If you are looking for marketing strategies that target all markets check out this guide or this guide)

1. Shrink the App Size to Accommodate Low Storage

As indicated above, low-cost smartphones are quite popular in emerging markets. These are short on storage space and users delete apps that are large in size.

So, where the app size limit in developed economies is at 0 MB, the same limit for emerging markets should be set at MB. This is a Google recommended guideline for building apps for the next billion.

In fact, Hello English – an Indian app that enables users to learn English from vernacular languages, decreased its app uninstalls by 15% when they decreased their size from 16MB to 9MB.

Facebook came out with Facebook Lite – with an app size of only 1.24 MB, to go deeper into emerging markets. Here is how Facebook advertises Facebook Lite:

Facebook Lite

 

2. Reduce Data Dependency to Counter Expensive Mobile Data

We observed above that mobile data is expensive, slow and unreliable in emerging markets. In order to tackle it, developers need to incorporate app features that allow the app to be used without data or WiFi.

One of the methods is to cache some content that can be used later. Another option is to allow non-data alternatives like SMS.

For example, Ola which is the biggest local competitor to Uber in India, allows users to book cabs by sending an SMS if mobile data/ WiFi is not available. And Uber allows its users in India to book cabs by calling.

UCBrowser by UCWeb became the most popular mobile browser in India due to its data saving feature and small size. One of the patents on their website talks about their advanced compression that reduces data costs by 85%.

In 2014, it was acquired by Alibaba to strengthen its presence in India.

3. Integrate Local Payment Methods for More Users

Credit card penetration is quite low in emerging markets as compared to that in the US. While the US has a credit card penetration at 71%, it is 50% in Brazil, 6% in Indonesia and 2% in India.

Moreover, smartphone habits are different and according to a study by Ovum, only 19% consumers in emerging markets are comfortable in paying through a credit card on mobile.

Ovum research shows users are not comfortable making payment through credit cards in emerging markets

This has given rise to Cash on Delivery (CoD) for e-commerce apps which has become a very popular payment method for Amazon and Flipkart (Amazon’s local competitor) in India. In fact, 20% of all e-commerce payments by the end of 2016 were made through CoD whereas this number was around 70% a few years back.

Uber adopted Paytm (a popular local wallet player in India) in India to get around the regulatory hurdle of 2-factor authentication in payments. Later, it also started accepting cash as payment in competition with Ola (the local competitor to Uber).

Also, it’s important to support other local payment methods in these markets.

Worldwide payment method

eWallets have 62% market share for e-commerce payments in China with a majority stake between  Alipay and WeChatPay.

Payment methods are quite distributed in India with eWallets, bank transfer, cash on delivery and cards having nearly equal shares.

Unified Payment Interface (UPI) launched by the government which allows users to make payments through mobile phones directly from their bank accounts and Paytm – a local wallet player backed by Softbank and Alibaba are quite popular in India.

Carrier billing and payment of online purchases through cash at ATM in Brazil are some other popular payment methods.

4. Focus on Referral Marketing to Increase App Downloads

Word of mouth & referrals through social media like Facebook are the key to app marketing in emerging markets.

As per a survey conducted among mCent users, more than 60% of the users in emerging markets like India, Brazil, Mexico, and Indonesia listed referral from a friend as the reason for downloading an app.

referral emerging markets

Referral from a friend is the top reason for installing an app among users in emerging markets

MakeMyTrip- India’s premier travel portal increased its app engagement and conversion rate by 25% which was driven by mobile app referrals!

5. If You Don’t Offer Discounts, You Won’t Grow

‘If you don’t do them, you won’t grow’, says Paul Malicki, CEO of Flapper – a mobile marketplace for private flights.  The average user in developing countries is very price sensitive and discount offers can do wonders.

On 10th Nov 2017, Alibaba hit a new record of $25.4 billion in discounted sales during Singles Day holiday in China. To put this number in perspective, the total sales of Black Friday and Cyber Monday combined in the U.S. was $4.7 billion in 2016.

China singles days sales

And get this, 90% of the payments happened through mobile using Alipay.

6. Localize Your App As Users Prefer Buying in Local Language

As per a study by Common Sense Advisory, 72% users in EMs prefer buying a product with information in their own language.

A great example of app localization is the game app Honorbound which received over 5 million app downloads and 14 times more features on the app store from localization. You can see the massive impact in their app store ranking after localization.

Rank history HonorBound

Downloads ranks of the game app HonorBound before app localization

Two weeks later, downloads shot up in all of their target countries. Of particular note is Turkey, where they went from not even featuring to number 377.

rank history after localization

Download ranks of the game HonorBound after app localization

If you are looking for more case studies, SellMyApp has the best guide on app store localization.

ICanLocalize, One Sky App, and Babble-On are some of the third-party localization you can use.

Which language to target for app localization? The answer depends on the type of app but in general, a research by App Annie revealed the following 10 most profitable languages – Japanese, English, Korean, Chinese, German, French, Russian, Portuguese, Italian and Spanish.

app localization emerging markets

App localization is a must for increasing downloads in emerging markets

But localizing your entire app for multiple countries is a time-consuming task and it is better to start with a minimum viable strategy. Here is how you can execute it:

  • First, just translate your App Title and Screenshots on Google Playstore for one country.
  • Observe if you see an increase in downloads. If yes, go ahead and translate your entire app listing page.
  • Check if you get more traction above, and only then localize your entire app.
  • Once you are done with one country, repeat steps 1 to 3 above for another country.

7. Partner with a Local Company to Build Credibility

Partnership with a local company helps you to grow your presence faster by leveraging its local expertise and building credibility in the mind of the local population.

For instance, LinkedIn partnered with Sina, Tencent, and WeChat for entering China.

Similarly, Airbnb has partnered with the Times Group to market their app in India.

Another great strategy is to partner with local mobile carriers. For example, Bemobi – a subscription-based mobile-app-discovery service partnered with local mobile carriers in Brazil such as Telefonica and Oi to offer apps from Electronic Arts and others.

It was in-turn acquired by Opera to establish a presence in Latin America.

8. Don’t Ignore Traditional Marketing Methods

As mentioned above, in EMs the cost of mobile data is high and the network is unreliable at times. So, most users actively switch off mobile data when not in use to decrease data usage and save battery life.

In such a case, offline methods of app marketing like SMS, MMS and Voice ads come in handy.

SMS garners 98% open rates and 33% response rates and thus acts as an effective channel for offline marketing.

Global beverage giant Coca-Cola believes that mobile marketing budget should follow 70:20:10 rule. Wherein 70% is allotted to mobile messages, 20% to mobile internet and 10% to trendy tools like apps, QR codes, Augmented Reality, etc.

Faasos, a food on demand app, has used SMS within its marketing strategy to grow to 1M+ users. SMS is the medium through which Faasos is connecting with users at vital points in their journey to provide important information.

      

Oyo Rooms the largest branded hotel chain in India increased their bookings by 5X through SMS marketing.

9. Try Alternate Business Models to Leverage User Volume

EMs have a huge number of users. In fact, India and China combined have one-third of the world’s population. So, even though the average revenue per user (ARPU) is low, they can make up for it in terms of volume.

Business models for an app should focus on these volumes to generate revenue.

One such model is ‘crowdsourced by-product’. It basically involves developing an engaging and free app to acquire a huge volume of users.

The app then becomes a crowdsourced labor pool to provide a by-product in exchange for free usage of the app.

For example, Duolingo has used this model to crowdsource paid translations for companies like CNN and Buzzfeed for free from its users.

These translations are much better quality than automated translations and yet cheaper than professional translations.

In fact, cancer research is using a variant of this model. Cancer Research UK developed Play to Cure: Genes in Space a space-themed arcade game to help identify defects in real-world DNA microarray data.

play to cure

Play to Cure: Genes in Space helps cancer researchers analyze data by tracking the routes taken by players to collect a valuable in-game resource.

10. Go beyond Google for International Search

The world of search goes beyond Google in emerging markets. There are many search engines that are widely used like Baidu (77% market share) and Qihoo 360 (8.7% market share) in China and Yandex (42% market share) in Russia.

infographic search engines worldwide

Search engine market share in 2016 by Blue2purple | Observe market shares of Baidu in China and Yandex in Russia

People across different countries search for the same products differently. So, target a different search engine with its specific set of keywords depending on the country for ads.

11. Target the Correct Messaging App/Social Network to Reach Your Audience

Emerging markets top apps

Top 10 used apps (by DAU) in emerging markets | Source – Jana on Mobile Advertising in Emerging Markets

The top 10 apps (by Daily Active Users) depends on the country and varies from one emerging market to another. For example, BBM is still the 3rd most popular app in Indonesia whereas SHAREit is among the top 5 apps in India to save mobile data cost.

However, there are some similarities as well like Youtube and Whatsapp are the top 2 most used apps in emerging markets except Indonesia where Google replaces Whatsapp.

So, Youtube should be the preferred medium for ads followed by Google Adwords. Unfortunately, Whatsapp doesn’t currently allow ads but app marketers can leverage Whatsapp by choosing it as the top sharing medium for referrals and content sharing.

As Google and Facebook are banned in China, it has different market dynamics altogether. Baidu, Tencent, and Alibaba (known as BAT) together dominate 72.6% of the app market share.

top apps China

Top 10 most used apps in China | Source: Statista

Among the top 10 apps, Tencent owns WeChat, QQ and Tencent Video whereas Alibaba owns Alipay and UCBrowser.

WeChat Marketing Case Study

In fact, WeChat has been successfully used by many companies to promote their apps in China. You can read the top 10 successful case studies for marketing on WeChat.

wechat case study

Starbucks China WeChat campaign gained 130,000 WeChat friends in 4 weeks

Starbucks used WeChat successfully to introduce a new drink by the name of Refresha, made from green coffee bean extract.

  • Using WeChat as the platform to spark off Refresha among their customers, Starbucks started the campaign by placing QR codes in their stores on cup sleeves and posters so that users could scan and add the coffee chain as a friend on WeChat.
  • The coffee chain then created a playlist of 26 songs to engage with their customers.
  • Their fans were then invited to send in any of WeChat’s 26 emoticons to express their mood or feelings. In turn, Starbucks would respond with an appropriate song to correspond to that mood.
  • Over the course of 4 weeks, Starbucks gained approximately 130,000 WeChat friends. Most surprisingly the sales volume for Refresha hit RMB 7.5 million in a mere 3 weeks. All of this was accomplished on a budget of just RMB 250,000.
  • In addition to this, the brand’s Sina Weibo (Chinese microblogging site) account gained a 9% increase in fans and generated over 57,000 reposts and comments.

12. Use Video Ads to Capture Attention in Emerging Markets

You can notice in the infographic above that Youtube is among the top 2 apps in most emerging markets. In fact, in a 2014 study in Southeast Asia, Middle East and Africa, 67% of the people prefer their mobile device as their primary video platform.

emerging markets video ads

Mobile video ads growth rate in emerging markets

The growth rate of mobile video ads is very high, in some cases touching triple digits, in emerging markets.

Both Youtube and Facebook have noticed the same. That is why Youtube has launched a new app Youtube Go to allow users in emerging markets to save videos for offline viewing.

Facebook has launched a new lightweight video product called Slideshow that allows users to combine photos to create a light sized video ad that can perform across many different types of devices.

However, keep in mind to localize your ad creatives for emerging markets to reach the maximum number of users.

Olx Video Ads Campaign in India

Video ads have been successfully used by OLX, the largest marketplace for used goods in India.

Their campaign with the tagline ‘OLX pe bech de’ or ‘ on Olx’ has been wildly successful. In India, the website gets 2.5 billion page-views a month, as on August 2015.

Here are the results of the OLX video ads campaign with InMobi in India. You can watch the video ad here.  For their campaigns ‘Let It Go’ and ‘The All New OLX’ with InMobi they managed to reach 25 million monthly unique users and over 300 million monthly impressions.

video ads emerging markets OLX

Olx video ads campaign with InMobi in India resulted in 2.5X higher conversions and 50% reduction in CPI

With over 11 billion page views, 30 million listings, and 10 million transactions per month, OLX has become the largest marketplace in India, Poland, and, Brazil. OLX is free to use and makes money selling promoted listings to users.

Uber and Amazon Have Also Used Video Ads Successfully

Uber’s ad regarding a funny take on arranged marriages in India was wildly successful getting 4 million views on Youtube.

Another app company that has used video ads successfully is Amazon with it #AurDikhao campaign. The objective behind the campaign was to penetrate deeper in Tier II and III cities where the campaign will do well.

It was an attempt to take a global brand like Amazon to masses. The campaign got more than 15000 subscribers for the same.

This ad film is a play on a typical Indian shopper’s tendency to always look at a lot of options to choose from before making a purchase. The film ends urging the viewers to download the Amazon app and enjoy the benefit of choice.

13. Leverage Influencers for Building Your Brand

If you can’t partner with a local company, another way of building trust in emerging markets with the local population is to reach out to influencers.

You need to put a face next to your brand for the local people to believe in you. That’ where you can leverage the fan following of influencers.

To find the right influencers you can use a platform like theAudience or Klear. For example, Flapper –  mobile marketplace for private flights, used this strategy successfully to grow in Brazil.

We found the biggest names in Brazil and contacted them. ‘Why don’t you take a flight in our private jet?’, we asked. From one post, we received 200k likes, with 1.2MM reach. That’s a 16 percent engagement rate. That’s a lot. After that our Instagram followership grew by leaps and bounds.’ – Paul Malicki, CEO Flapper

emerging markets influencers

Influencer marketing brought 195K likes and 1.2M reach from one Instagram post for Flapper in Brazil

These engagements from influencers can also have a compounding effect.

In the case of Flapper, they got a feature in the top 4 categories in LinkedIn after an influencer published their story. Each category can have up to 800,000 followers.

Because of this article, the biggest media channel in Brazil featured them the next day. All because they with right influencers at the outset.

14. Keep an Eye Out for Ad and User Fraud

You might consider monitoring for fraud as one of those things which are good to do but no one actually does. But you can really burn through your spend if you don’t keep an eye out for them.

Click farms in emerging markets have become a real pain for the eCommerce industry. These click farms generally consist of a 3 to 4 person-setup with hundreds of cell phones and thousands of sim cards attached to computers.

click farms

Click Farm – Observe the wires dangling out of the rig of mobile phones which connect to a computer

They can quickly burn through your ad-spend on Facebook or Google Adwords by clicking on your ads without providing you any real users. They are also used to send fake ratings and likes to artificially boost your online popularity.

Recently, a big click farm was busted in China with 10,000 mobile phones.

Users in emerging markets like India and Indonesia rely on devices with multiple-SIMs. These devices can inflate your ad impressions and can be used for fraud.

Apps that process payments, especially eCommerce apps, should also be wary of such frauds like coupon frauds ( the same user using hundreds of SIMs to get the first-user discount), payments through stolen credit cards, incorrect refunds/chargebacks, and others.

The best way to tackle this is to build amount, velocity and unique device checks for your transactions, monitor your ad spends and stay away from black-hat marketing.

Even unicorns like Amazon and Uber have faced these frauds and continue to develop methods to curb it.

Final Words

Emerging markets are currently in their growth phase. Smartphone penetration is increasing as millions of users are added every year.

By 2020, they will contribute to more than 50% of the revenue and downloads on app stores.

Thus, if you are looking to increase your revenue from mobile apps, emerging markets should be a key component of your marketing strategy.

Also, CPIs are currently the lowest in these markets. It offers app developers a chance to get users at the lowest possible cost.

But these markets are quite different as compared to the mature markets like US and UK.

Low-cost smartphones with lesser storage and battery life, expensive mobile data with unreliable networks, and the dominance of Android phones with 90% market share means that the marketing strategies for mature markets can’t be applied to them.

You need to focus on the app marketing strategies that take these difference into account.

So, be selective about which markets you want to enter, plan your expansion carefully and use innovative marketing strategies like the ones mentioned above.

Even if you apply a few of them, you will be ahead of the majority of apps which didn’t fine-tune their strategy. Remember, the market size is huge and even a small share can give you decent returns.

 

About the author

Neelabh Singh is the Founder of App Disciple. He is passionate about helping beginner app entrepreneurs (with/without coding background) overcome challenges in starting your own profitable app business, through step-by-step actionable advice from genuine, successful developers. Apart from that, he is a productivity ninja and spends his free time reading philosophy and investing in the markets.

 

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