Thinking of Developing That App??

If you run an interactive team, marketing agency, or VC firm you’ve considered developing or backing development of a mobile app. It would be silly if you hadn’t. Since 2008, the year the App Store opened, over 100 billion apps have been downloaded and more than 4 million apps are currently available in the App and Google Play stores. So you could be forgiven for assuming that developing a mobile app is a cost of entry for running a business these days.

But if this is a decision you’re facing right now you have very good reason to doubt the value of incurring the expense. Not because you don’t need a useful mobile presence, you do no matter what your business offering, but because requiring customers to install an app introduces potentially unnecessary customer experience hurdles. I know unless I think I will use a service every day I won’t go through the trouble of downloading an app, no matter how many times I get asked (looking at you, Yelp). If anything, my focus on my smartphone has been to get rid of apps I downloaded rather than adding new ones to reduce clutter.

The Data

According to comScore’s latest mobile app report, most US smartphone owners download zero apps in a typical month, and year over year downloads have declined 20%. Add to that the very real impact of Google’s recent decision to penalize websites that push mobile web traffic to download an app, and the Android release last year that provided enhanced mobile web experiences and taking a big pause before investing in development of a new iOS or Android app is more than warranted.

All that being said, there’s no denying that online mobile experiences are dominated by apps. Last year TechCrunch reported that 85% of time consumers spent on smartphones was spent in apps. But of that time, only 5 apps saw heavy use. Which apps took up that time varied from user to user, but for most that dominance in mobile device usage is driven by the most popular social network, email and news apps.

As the comScore graph below shows, although most of us have a wealth of apps accessible on our phones by and large we use fewer than five on any given day. After that no apps, on average, take more than 3% of our online smartphone or tablet time. So unless you’re lucky enough to be one of those top five performing app providers, odds are your app isn’t getting much airplay.

*source: comScore 2015 Mobile Apps Report*

If your app is not or is not expected to become one of the top apps for your audience then the choice to invest or not in developing an iOS and/or Android app should give you pause. Of course that doesn’t at all mean that you don’t engage with your audiences in the mobile space, just that you can consider foregoing something that conventional wisdom still assumes is required.

Return of the Mobile Web

The mobile web has come a long way since the first days of smartphones, when, before the Apple App Store was introduced, Steve Jobs was eager for owners of his new iPhone to get online. Back then mobile browsing platforms didn’t provide the experiential opportunities that last year’s the latest releases of Android and iOS offer. Now developers have the ability to deliver experiences as immersive and flexible as your favorite apps through the mobile web, and have just one platform to maintain rather than two for iOS and Android.

Last year Benedict Evans summarized the business driver for choosing native over web to just one question: “do people want to put your icon on their home screen? If the answer is Yes, go native. If No, go web.” Recently one major brand, Patagonia, decided to shut down the iPhone app they launched in 2010, stating that “now our website is beautiful and easy to use on all mobile web browsers” and inviting users to delete the app from their devices.

There’s no question that new business solutions will continue to be introduced that warrant a dedicated app to facilitate transactions, provide offline use, and to take advantage of native experience opportunities. But those experiential advantages alone, such as they still are, no longer justify the expense.

Talk about the future of tablet computers these days and you can get a lot of skeptical looks – and no wonder. Recent articles with headlines like “Tablet sales plummet” (Seeking Alpha), “Tablet market slumps as buyers find alternatives” (The Star Online), “Tablets are toast” (The Register) all anticipate a slowdown in the adoption of tablets for business or home use. These arguments are indeed grounded in reports by Apple and Samsung that sales of their tablet devices are down year over year by 12.8% and 17.1% respectively. Those are big numbers that understandably have a lot of analysts and retailers reassessing their plans for investing money and shelf space in tablets. So what’s behind this year on year decrease in sales? It turns out a lot of factors are driving those numbers and digging into them reveals that tablets are far from “toast.”

Some of the slowdown in sales growth can be attributed to the fact that tablet users aren’t replacing these mobile devices as actively as they do their smartphones, so after massive rates of adoption since the introduction of the iPad five years ago a slowdown should have been anticipated. Considering that the features added with successive releases of the iPad have been limited in terms of hardware advances and you have an environment where users are not compelled to trade up to the latest model. “We continue to get feedback that tablet users are holding onto devices upwards of four years,” wrote analyst Ryan Reith of International Data Corporation (http://gadgets.ndtv.com/tablets/news/tablet-market-slumps-as-buyers-find-alternatives-idc-758976).

More instructive for companies actively developing apps and accessories for tablets are comments from Cathy Boyle, a senior analyst at eMarketer, who points out that “(t)he most limiting factor is the use case for a tablet: It is not as clear-cut or compelling as a communication tool—the core capability and use case for a smartphone.” (eMarketerWorldwide Internet and Mobile Users Q1 2015 Forecast) And Faisal Kawoosa, Lead Analyst at CMR, a leading Indian IT and Telecomms research and consulting firm, notes that “(u)nless the industry make substantial differentiation in the value proposition for potential customers, tablet shipments are not going to grow… With not much value addition coming in the shape of specific solutions to enhance device usability at the moment, tablets are only becoming devices of convenience, essentially larger screen versions of smartphones.” (http://www.cxotoday.com/story/will-tablet-pcs-become-redundant-soon/ October 5, 2015)

We will take up the topic of the place that tablets can occupy distinctly from smartphones and laptops or desktops in a subsequent post, but rather than concluding that the tablet use base globally will decline, as some of the headlines referenced above may lead you to conclude, the Ambility team remains confident in the continued growth of the tablet user base, and we’re not alone. Indeed, eMarketer forecasts that there is still “significant room for increased penetration. The number of tablet users will jump from 13.9% to 19.9% of the global population and from 32.2% to 38.7% of internet users between 2015 and 2019.” (eMarketer Worldwide Internet and Mobile Users Q1 2015 Forecast)

In the world’s most populous countries the forecast is even more buoyant: “Approximately 41.0% of people in China will use (tablets) this year. By 2017, half of the country’s population will do so. China’s burgeoning middle class will be the main force behind growth… Indonesia and India will post the fastest tablet user gains worldwide over the next few years. The number of tablet users in both countries will nearly double in size by 2019.”

Lack of Positive Externalities for the Tablet

The concept of externalities and their impact on products or networks is old and frequently brought up when a technology standards war is underway – such as the ’80s/’90s war between Apple Macs and Microsoft PCs, and now iOS and Android. An externality is the cost or benefit that affects a party who did not choose to incur that cost or benefit. At Ambility, we are working hard to launch what we think is a positive external facilitator of tablet computing – an adjustable docking solution that fits beautifully into the home or office – and were struck by Cathy Boyle’s statement quoted above: “The most limiting factor is the use case for a tablet: It is not as clear-cut or compelling as a communication tool…”

We have long viewed tablets as extremely valuable devices for the home and office but recognize that hands-on or desktop usage only accommodates a subset of the overall use cases they are capable of effectively addressing. Yet the level of development for both apps and accessories for tablet-specific usage is limited compared to that for smartphones. According to Econsultancy 61% of companies report building apps specifically for iPads and 46% for Android tablets versus 86% of companies that are building for iPhones and 84% for Android phones. An Amazon search for “iphone accessories” yields 60,673,582 results while a search for “ipad accessories” returns 8,566,193 listings. Development for tablets is clearly of secondary importance, potentially leaving new solutions opportunities unaddressed.

The introduction of the iPad Pro and market adoption of the Microsoft Surface, however, show that the market is starting to appreciate the business related use cases for tablet computers. According to CXO Today Windows tablets are wooing the enterprise. In the Mobility Index Report published by Good Technology, Windows tablet adoption is reported to have increased 400%, from the last quarter of 2014 to the first quarter of this year. (http://www.cxotoday.com/story/are-tablet-pcs-failing-to-impress-business-users/) This is largely driven by the business apps on offer through the Surface and its Microsoft Suite, and iPad apps are slowly catching up. Add enhanced positioning solutions and hands-free interaction capabilities like voice control and look for tablet sales to regain their momentum in the consumer space as well.

Tag: android

Thinking of Developing That App??

Tablet Sales Declining?