App Economy health status: a quick forecast

By October 2, 2017Digital evolution

The digital evolution is now a reality and it’s there for all to see how a mobile-first approach is essential for all companies that want to develop and boost in an effective way the digital transformation of their business.
But in the majority of western regions this transaction is still a work in progress activity; on the contrary, it’s a more tangible reality in eastern ones.
To better understand this phenomenon it could be useful to analyse the data and forecast about the App Economy health status in the App Annie report.

In a 2016 report, App Annie estimated that the App Economy would have reached $1.3 trillion thanks to three key-points: mobile Apps, in-App advertising and mobile commerce.

This goal has been gained by the total amount of hours (1.6 trillion) spent in App by 3.4 billion people all around the world.
According to a new forecast these numbers are destined to grow up in 2021 till reaching $6.3 trillion of value for the App Economy and 3.5 trillion of hours spent in App.

This data projection reveals also a discrepancy between western regions and Asia Pacific economies. The first ones constrained by legacy systems (e.g. banking and payment transfers) and with an overconcentration of wealth among older customer base, on the contrary, in Asia Pacific regions the legacy systems don’t impact on the App Economy.

What’s about the App Store forecasts?

Even if starting from 2017 Google Play Store and third-party Android stores have surpassed iOS App Store, according to this forecast, in 2021 it will continue to be the largest single store reaching over $60 billion.
Furthermore, games will keep on be the driving segments for stores growth but also non-game Apps will triple their size to over $34 billion in 2021.

Also in-app advertising will triple its size nearly achieving $201 billion in 2021 thanks to the boost of Asia-Pacific regions and the Americas (respectively +25% and +26% CAGR).

But which is the largest driver?

The answer is mobile commerce.
Global mobile commerce overtakes other forms of monetisation reaching 38% CAGR with Asia Pacific regions which move more quickly to mobile pushing the mobile-first paradigm with $3.2 trillion in 2021 and becoming the single largest region for mobile commerce revenue.

To better understand the use Asia-Pacific consumers do of mobile commerce, it’s useful to compare them to US consumers; for example Chinese consumers are nearly three times as likely to buy food via their devices, twice to move money using Apps and four time more likely to spend their disposable income on mobile.

In conclusion, the mobile-first approach is an opportunity to be grasped by all enterprises and companies that want to reach a bigger customers base, especially because by 2021 nearly 2 billion more people are expected to adopt mobile devices using them for everyday activities.

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