According to IBM, two out of five online retail visits in the U.S. on Black Friday were made from mobile devices, directly generating more than 20% of online retail sales. On Thanksgiving Day, smartphones and tablets accounted for an even greater share of online retail visits and sales (43% of visits and 26% of sales). These results show the extent to which connected devices now influence retail sales, but Flurry’s own Thanksgiving weekend data demonstrates that our relationships with our smartphones and tablets go well beyond picking up a Black Friday deal while picking at Thanksgiving leftovers.
App usage overall in the U.S. spiked by 25% on Thanksgiving compared to the previous Thursday, and not just as a result of shopping app use. The overall pattern of app usage over the Thanksgiving weekend demonstrates that smartphones and tablets have become the first truly personal computers, changing their function as we change our routines. To illustrate that point in this post, we take an in-depth look at U.S. app session starts from the day before Thanksgiving through to Cyber Monday. We compare Thanksgiving week to the week prior, and also compare those time periods for the two previous years. (By including the weekends prior to Thanksgiving for each year we can distinguish between overall growth in app usage and use that is unique to Thanksgiving weekend.)
App Use Spikes on Thanksgiving
The chart below provides a high-level view of how overall app usage has changed from year to year, and changes between the week prior to Thanksgiving and the week of Thanksgiving. The gaps between the green, blue, and gray pairs of lines illustrate the extent to which app usage in the United States has grown year over year, with baseline usage the week before Thanksgiving up by about two-thirds compared to the same time last year, and about triple what it was during November of 2011.
The darker line in each color pair shows Thanksgiving weekend for a particular year while the lighter version shows the prior weekend for that year. The gap between the lighter and the darker lines in a color pair shows the difference in app usage by day between Thanksgiving weekend and the prior weekend. For the past three years, that difference has been greatest on Thanksgiving Day, diminishing to return to normal by Cyber Monday. In 2011 and 2012, U.S. app usage spiked by 20% on Thanksgiving Day compared to the previous Thursday. This year the Thanksgiving spike grew to 25%.
Given mobile devices are so personal, it’s no surprise that they tag along as we enjoy Thanksgiving weekend, but we wanted to understand the drivers behind the Thanksgiving spike in app usage. Is it just mobile shopping? Recipe apps aiding Thanksgiving cooks? Football fans checking stats from the couch? Social networking apps used to stay in touch with family far away? What accounts for the extra app sessions on Thanksgiving?
To find out, we compared app sessions by category for Thanksgiving weekend to the weekend before, focusing on the three days for which there is the biggest difference in overall app use.
The results are shown in the table below. The rows are app categories aggregated across operating systems. The columns show changes in app usage between Thanksgiving week and the same day the previous week for each category. Each cell shows that same comparison between Thanksgiving week and the previous week for the past three years.
Use of Shopping Apps Is Up Overall – Not Just On Black Friday
For obvious reasons, shopping apps consistently spike over the Thanksgiving period. Interestingly the bump this year wasn’t as large as the one last year; however that should not be interpreted to mean that enthusiasm for shopping apps is waning. On the contrary, between 2012 and 2013, overall use of shopping apps in the week before Thanksgiving grew by about 70%, so the 2013 Thanksgiving spike comes on top of a higher baseline usage level.
Media and Gaming Are Even More Popular On Thanksgiving
App categories beyond shopping that saw spikes in app usage during Thanksgiving week are fairly predictable. Media spiked on Thanksgiving Day in particular – most likely in part because it includes photo and video apps used to record family gatherings. It was also somewhat higher on Wednesday and Friday compared to the previous week.
More time for relaxation probably explains why game apps, which are always popular, enjoyed even more use over the Thanksgiving period than the week before.
Even Workaholics And Dedicated Calorie Counters Take Thanksgiving Off
What types of apps experience less use on Thanksgiving and the days immediately before and after than during the previous week? Mainly apps associated with things people take a break from over the Thanksgiving holiday: business and education, health, and news.
Travel apps also experience a decline in use Thanksgiving Day and the day after. That may seem counter-intuitive since Thanksgiving weekend is one of the busiest travel periods of the year; however it’s important to remember that people tend to be traveling to familiar places and often staying with relatives or friends so are less likely to need apps for booking hotels and rental cars or finding their way around an unfamiliar city.
Smartphones and Tablets Have Become Our Constant Companions
So shopping does contribute to the spike in app activity on Thanksgiving, but it’s only part of the explanation. This data shows the extent to which smartphones and tablets have become our constant companions, morphing their function to our whims and circumstances in ways even laptops never really did. They are truly our most personal computers. Sure, you can use them to shop without getting out of bed, let alone braving crowds at the mall, but your device can also entertain you with games, music, and movies. It can even tell you how far you need to walk to make up for that second helping of mashed potatoes – if you choose to look.
Santa is making his list and checking it twice, and with Black Friday and Cyber Monday coming soon it’s time to start making your lists too. As we’ve said before, apps and app usage reveal a lot about the interests and passions of device owners. With that in mind, we’ve compiled app-inspired gift ideas for the smartphone and tablet users on your holiday list.
To do that, we investigated app usage patterns for different Personas (psychographic segments) using a sample of 97,963 randomly selected iOS and Android devices. Our suggestions are based on the apps that members of each Persona use the most or to a greater extent than other smartphone and tablet users.
A Reminder On Giving Apps And Other Digital Content
Many apps are free, but if you want to give paid apps or other paid digital content note that you can give specific music or apps or set up a monthly allowance from Apple’s iTunes and App Store, whereas from Google Play you can only select a gift card. You can always add some suggestions for paid and free apps or other digital content you think a recipient might enjoy to make a gift card a little more personal or transform a holiday card into a gift.
Wishing You Joyful, Gadget-Lit, Holidays From Flurry
The best gifts tap into the recipient’s life and passions. Apps are a great way to gain insights about your loved one’s interests, so before you start shopping look at their phone or tablet for some ideas. We hope this has given you some inspiration for selecting holiday gifts, and wish you a joyful, gadget-lit, holiday season.
Links referenced in the infographic: 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30
In October of 2013, Softbank Capital made a $1.5B USD investment in Supercell, the maker of two successful mobile games, giving Softbank a 51% ownership of the game maker. This investment caught the world’s attention. It wasn’t just the rich $3B USD valuation Softbank placed on Supercell that intrigued onlookers, but more the speculation that Softbank and its CEO Masayoshi Son were onto a bigger trend. Mr. Son has a solid track record in anticipating big shifts in worldwide markets in general and the tech industry in particular. In the mid-nineties Softbank was a publishing powerhouse. By the mid 2000s the company became an Internet powerhouse. Today, Softbank is the third largest wireless carrier in the world. So what does this investment signal about the big shift that Mr. Son is anticipating? At Flurry we believe he is placing bets on the Mobile Content Explosion that is taking place around us.
Early Indicators Signal the Content Explosion
At Flurry, we have always looked at the applications being started on our platform as a leading indicator of the app economy’s health. This is very similar to how U.S. economists treat housing starts as a leading indicator for the national economy. Typically, developers engage with Flurry and start applications on our platform a couple of months before they list them on App Stores. So if the activity on Flurry increases, it signals that more apps (and content) will be available on the stores within a couple of months.
Looking at application starts on the Flurry network since January 2012, we see an increase in the quarterly growth rate. This is in stark contrast to theories that the app ecosystem is congested. In fact, in just over 18 months, the rate of which new apps are being started on the Flurry network has nearly doubled as shown in the chart below.
While Flurry’s market share in analytics could have increased, we don’t believe it is the major factor in the acceleration of applications starts. Instead, we believe that we have entered a new phase of mobile content explosion, driven by rapidly changing consumer behavior. Over the last two years, application developers and media companies have seen the shift from personal computers to smart mobile devices including phones and tablets that are now in the hands of over 1.2 billion people worldwide. They have also seen the wild and global success of gaming, utility and messaging applications such as LINE, Kakao, Snapchat and WhatsApp. They are simply acting accordingly. With the hopes of reaching these 1.2 billion people with a press of a button, app developers and media companies are building mobile apps like never before.
There is an Audience for That
Pundits have criticized the increasing number of apps and have often claimed that while there are millions of apps out there, very few are being used. They also claim that a few app developers have the lion share of usage, especially in the United States and other mature markets such as Japan and South Korea. Earlier this year, a report from Comscore claimed that Facebook (and Instragram) accounted for 26% of all times spent on mobile. In its latest earnings reports, Facebook’s COO Sheryl Sandberg almost confirmed Comscore ‘s numbers and claimed that Facebook’s share of people's time is larger than that of YouTube, Twitter, Tumblr, Snapchat, LinkedIn, AOL and Yahoo combined. While Facebook’s reach and percentage of time spent are in a league of their own, there appears to be plenty of whitespace for others. In fact, just on the Flurry platform the number of independently owned app developers that have a worldwide audience of over 20 million Monthly Active Users (MAU) has jumped from 7 in Q1 2012 to 32 in Q3 2013. That is whopping 357% growth in 18 months.
In the same period, the number of app developers with an audience over one million MAU has risen from just under 400 to 875, a whopping 121% growth.
These numbers are simply unprecedented, especially because most of these app developers have risen organically, and not as a result of consolidation or through mergers and acquisitions. If anything, the market, its reach and the time spent on mobile is still with the “middle class”, or the mid-tail developers and content owners. Among the 1.2 billion device owners, app developers are finding millions of people to enjoy their apps and the content behind it.
Flurry’s numbers, which show the fast rise of app developers with large audiences, seem to indicate that worldwide, consumers with smart devices are still hungry for apps and mobile content, and app developers are building at increasing rates to feed this demand. We believe that once again, Softbank’s Masayoshi Son could once again be onto something really big.
According to the U.S. Census Bureau, more than 12% of people in the U.S. speak Spanish at home, and nearly fifty million Americans are of Hispanic origin. The collective purchasing power of Hispanics is expected to reach 1.5 trillion dollars by 2015. Brands are clearly aware of the importance of this demographic group, and there are advertising agencies dedicated toward helping brands communicate with Hispanic consumers. Nonetheless results of some recent research suggest that brands are not doing enough to create positive app experiences for Spanish speaking consumers in spite of the fact that Hispanics in general are enthusiastic users of smartphones.
Last week’s Advertising Research Foundation forum on the intersection between mobile and culture inspired us to investigate what the overall U.S. appscape looks like from the perspective of Spanish-speaking device users. Flurry is able to do that because we can detect what language a user’s device is set to each time they start an app session, and we record data from over a billion app sessions each day in the U.S.
Defining Spanish Interest Apps
We started by defining Spanish Interest apps as those for which there is at least one U.S.-based user with their device’s language set to Spanish for every twenty set to English. We used this as an indication that a non-trivial proportion of the app’s users speak Spanish, indicating some level of interest in the app among Spanish speakers. As shown below, 15% of apps with fifty or more daily users in the U.S. were in this category.
Android Speaks Spanish
The overall percentage of Spanish Interest apps is in line with what you might expect given the prevalence of Spanish speakers in the U.S., but what’s surprising is how those apps are distributed across mobile operating systems. As shown below, nearly half of Android apps are Spanish Interest apps compared to less than 5% of iOS apps. In other words, 47% of Android apps have one or more user with their device set to Spanish for every twenty who have it set to English. That is only true of 4% of iOS apps.
It’s important to note that this may not be so much a reflection of app availability as it is a reflection of device ownership patterns since the apps a user can run are determined by their device’s operating system.
Spanish Speaking Android Users Love Games Even More Than Everyone Else Does
The apps that have the greatest number of U.S. users with devices set to Spanish as compared to English are mainly Spanish language apps (some originating from the U.S. and some from countries for which Spanish is the dominant language). Other than that, Spanish Interest apps span the full range of app categories but are disproportionately likely to be in the Game, Live Wallpaper, Personalization, and Photography categories in Google Play. As shown below, Spanish Interest apps are also over-represented in some iOS categories, but because the base rate on iOS is so low (4%) the absolute percentage of Spanish Interest apps is still relatively low even in categories in which they are over-represented.
Fans Of Pets, Sports, And Bargains
By definition, the audience for Spanish Interest apps includes Spanish speakers, but we wanted to find out what else we could learn about the audience for those apps. We did that by identifying which Flurry Personas (psychographic segments) are over- and under-represented in Spanish Interest apps. We found that Pet Owners, Sports Fans, and Value Shoppers are among the over-represented Personas and Auto Enthusiasts, Home and Garden Pros, and Real Estate Followers are among the under-represented. A more complete list is provided below.
Brands Don’t Speak Android
Many brands have taken a while to embrace mobile at all, and to the extent that they have they have tended to start with iOS. Some haven’t ventured any further. In some cases that is due to concerns about fragmentation or for brand safety in the more open Android ecosystem, but it is also due to the demographics of the user bases for iOS and Android. A considerable body of evidence suggests that, on average, iOS users are more affluent than Android users and they tend to spend more money in a variety of product categories.
Combine that with the tendency of Spanish Speakers to use Android devices, and it’s easy to understand why few brands have created Spanish language apps. The fact that some of the Personas most coveted by advertisers are under-represented in the apps in which Spanish speakers are most over-represented reinforces this point.
Given the size of the Spanish speaking population, the shift of consumer attention toward mobile, and the advertising budgets following them, this situation needs to change. Our results show that if marketers want to reach Spanish speakers on mobile they are going to need to do so using Android. That creates an opportunity – or really a necessity -- for Hispanic-focused advertising agencies to lead in creating high-quality brand promotion on Android. While Android users in the U.S. may be less affluent than iOS users, collectively they still have massive purchasing power, and world-wide, Android is even more dominant than it is in the U.S. Given the size of the Android audience world-wide, teaching brands to speak Android could pay big dividends well beyond those that can be generated from U.S. Spanish speakers.
Many of us at Flurry love Mad Men, but we believe that Don Draper’s advertising industry is ancient history. Don would probably mistake smartphones for cigarette cases and tablets for coasters. More importantly, sophisticated buyers and sellers in today’s advertising market are making decisions in real time based on masses of data rather than months in advance based on charm and corporate hospitality. Advertising buying is being disrupted by efficiency gains from real time bidding (RTB) and effectiveness improvements achieved by using big data to inform mobile advertising transactions.
Data-Driven RTB In The Mobile Space
Recently Flurry launched an RTB Marketplace that enables advertisers to bid for the attention of smartphone and tablet users one at a time. We are betting big on the trend toward programmatic buying for two reasons. First, it enables precision targeting that was unimaginable in the pre-digital age and is still uncommon. Buying ad exposures one at a time enables advertisers to reach precisely-defined audiences wherever they are and whenever they use their devices. That level of precision would always have been useful, but it is especially important now that consumer interests, preferences, and lifestyles have become so varied.
Second, RTB brings a new level of efficiency to ad buying. The whole nature of an auction means that an advertiser who is willing to pay the most to reach a certain type of person will earn the opportunity to do so. The price advertisers are willing to pay provides a clear signal of the relative value they place on a customer or potential customer.
In this post we share initial results from our Marketplace to illustrate the power of combining the price signals provided through RTB auctions with the individualized targeting capabilities made possible by big data.
Building A Mobile Audience One Person(a) At A Time
The chart below illustrates three important results related to the value advertisers place on different types of mobile users and the available supply of those people’s in-app attention. The items being plotted are Flurry Personas. These are groups of devices whose owners access particular types of apps more frequently than people using other devices do.
The size of the bubble associated with each Persona represents supply, or the relative number of auctions for the right to serve an impression to a device in the Persona. Of the Personas shown here the greatest number of available impressions were for Casual and Social Gamers and the least were for Fashionistas and Food and Dining enthusiasts.
The x-axis, clearance rate, shows the percentage of auctions that had a winning bid, resulting in an advertiser displaying an ad on a device. As can be seen by looking at the right bound of the x-axis, less than half of the auctions had a winning bidder. This is a normal and expected result in RTB auctions. Reasons for auctions not clearing include price floors being set too high, bidding technologies used by advertisers’ representatives responding too slowly, some publishers being able to sell their ad inventory for higher prices elsewhere, and advertisers being uninterested in the inventory some publishers offer.
The y-axis shows the average effective cost per thousand impressions (eCPM). Even though these impressions are sold on an individual basis that is still the common pricing metric.
Fashionistas And Foodies Command A Premium, But Hipsters And Music Lovers Are Cheap
Examining supply, price, and clearance rate together reveals a lot about the state of play in the mobile advertising market. First, the fact that Fashionistas and Food and Dining Lovers are in the upper right corner implies that those Personas are of greatest interest to advertisers. It seems logical that those would be desirable psychographics, but the limited supply of ad inventory for those Personas also helps explain why prices and clearance rates are high. It means there are opportunities to generate mobile advertising revenue by publishing apps and content that attract Fashionistas and Food and Dining Lovers.
At the other extreme, Music Lovers and Hipsters have relatively low clearance rates and relatively low average eCPMs. While the supply of impressions for these groups within our Marketplace is not particularly large (as shown by the medium-sized bubbles), we hypothesize that people in these Personas are fairly easy to reach outside of our Marketplace because music fans spend a lot of time in music apps and many apps attract mobile-savvy Hipsters. It also makes sense that advertisers compete less aggressively for Music Lovers considering how inexpensive music is now compared to the pre-Napster era.
The overall diagonal pattern formed by the personas shows that the market is working efficiently, as expected. How do we know that? If a Persona had a high clearance rate but a low average eCPM we would expect advertisers to bid up the price to secure inventory. The fact that there are no Personas in the lower right corner shows that is exactly what has happened.
A position in the upper left corner of the chart means that auctions to advertise to that Persona have a high average eCPM given their rate of clearance. Here, we would expect publishers to drop their floor prices to achieve higher clearance rates. The fact that there are no Personas in the extreme upper left corner suggests that is also happening. There are some Personas with positions approaching that upper left corner: News and Magazine Readers are the most extreme example. We see two possible explanations for why those publishers didn’t drop their floors in search of higher clearance rates. One is that some of those publishers are able to sell impressions that don’t sell through our Marketplace direct or to use them themselves (i.e., to promote their own properties). The other is a policy of keeping prices above a certain level to maintain a premium image even if it means sacrificing short-term revenue opportunities.
Power Lunches Are Losing Out To The Power Of Data
RTB moves at lightning speed. A publisher can shop a single impression in the nanosecond before the winning ad appears. Compare that to the speculative, mass-market approach of the Upfronts, and it’s easy to see that advertising buying is likely to be completely disrupted by RTB.
The Persona-based targeting described in this post demonstrates the power of data to inform each bid. Advertisers no longer need to make buying decisions based on stereotypes about which types of people are interested in what type of products or content. They can define their target audience precisely, and aggregate that exact audience efficiently impression by impression. Mobile also contributes to this type of precision targeting since smartphones are highly personal devices loaded with apps that reveal much more about the person looking at the screen than standard demographics ever did. The long held promise of digital advertising is finally being realized on mobile.
All of this leads us to believe that advertisers or publishers who want to do things in the old way may be better off kicking back, pouring themselves a drink, and watching an episode of Mad Men instead of entering the fray in the mobile advertising space where data-fueled RTB is sure to win.
Just five years ago, PCs reigned supreme and so did the US software industry. In 2008, U.S. companies produced an estimated 65% of all PC software units sold on a worldwide basis.
In only half a decade, smartphones, tablets, and perhaps most importantly, apps, have changed the nature of the software industry. In this post we look at where apps are being developed and used and discuss the implications of that for the Post-PC Era software industry.
More Apps Are Now Being Created Outside The U.S. Than Inside The U.S.
Let’s start by considering where apps are being produced. The chart below shows the percentage of the apps that were recording data through Flurry Analytics as of the start of June in a given year broken down by whether they were created in the US or in another country. As shown in that chart, even in 2011, only a minority of apps were created in the US. By June of this year only 36% of the apps we measure were made in the U.S.A.
U.S. Made Apps Still Dominate App Engagement, But Their Share Is Slipping
Of course, some apps enjoy much greater use than others, so we next considered how the picture changes if apps are weighted by total time, which takes into account both user numbers and engagement. Once time is taken into account, things look considerably better for the U.S., suggesting that, on average, user numbers or engagement are greater for apps made in the U.S. than for apps created elsewhere. That makes sense given the size of the U.S. population, the fact that it was an app pioneer country, and the number of English speakers in other countries who might be able to use U.S.-made apps without any localization. Nonetheless, even the weighted percentage of apps made in the U.S.A. has dropped in the past year.
Use of Local Apps Is Strong In China
This should not lull U.S. app developers into a false sense of security however. That becomes evident from examining where the apps used by people in particular countries are made. That’s what the chart below does, starting with the United States. Nearly sixty percent (59%) of the time U.S. users spend in apps is spent in apps developed domestically, meaning that more than 40% of the app time of U.S. consumers is already spent in apps developed in other countries.
And while U.S. made apps are used elsewhere, unsurprisingly, people in many other countries spend a significant amount of their app time in apps developed in their home countries. For example, 13% of the time spent in apps in the UK is spent in apps made in the UK and 8% of the time spent in apps in Brazil is spent in apps made in Brazil. But as is so often the case, it’s China where things get really interesting. Nearly two-thirds of the time spent in apps in China is spent in apps made in China. U.S. made apps only account for 16% of total time spent in apps in China. The size and growth rate of the Chinese app market imply that the worldwide share of time spent in apps that are produced in the U.S. can be expected to contract further.
Translating apps and adapting apps to make them culturally appropriate is necessary in a country such as China to get most people to download and use most apps made elsewhere. Until recently, rapid growth in countries that didn’t require that type of effort meant that many developers based in the United States probably didn’t want to bother. With growth in the smartphone, tablet, and app markets in countries such as the U.S. slowing and a lot of remaining room for growth in countries such as China, some developers may now be reconsidering that position. It will be interesting to see if many can successfully adapt their apps for world markets.
While many U.S. app developers are just starting to think about globalizing their apps, it has been a near necessity for developers in some other countries from the beginning. Consider the situation facing a developer in a small country where the local language is not one of the world’s dominant languages. Unless they create an app with global appeal (e.g., a flashlight app), or that can be adapted to local markets relatively easily (e.g., translation of a weather app), they are likely to end up with very few users. That is a problem since the time required to develop an app for a small number of users is no different from that required to develop an app used by a large number of people.
App Developers In Other Countries Have A Head Start Globalizing
Creating global or localizable apps turns that problem into an opportunity. The chart below suggests that developers in countries such as Finland, Denmark, Bulgaria, and Slovenia are taking advantage of that opportunity. The numbers in the chart reflect the impact of app developers in a given country by taking the total percentage of time users worldwide spend in apps developed in that country and dividing it by the total percentage of apps developed in that country. Note that this is equivalent to taking the 2013 percentages in the second set of charts in this post and dividing them by the 2013 percentages in the first set of charts. For example, 70%/36% = an impact of 1.9 for the US. A metric of one or greater indicates that, on average, apps developed in a given country command a disproportionate share of time. The bigger the number, the greater the impact of apps developed in that country.
Given the dominance of English, the tendency of U.S. cultural products to spread internationally, and the fact that much of the app economy developed in the U.S., it’s not surprising that the metric for the U.S. is greater than one. China’s large population and the difficulties developers outside of China face developing for that market also make its high impact somewhat expected. What’s much more interesting is that the other five countries that have an impact metric of one or greater are all small, and four of the five speak relatively rare languages.
Globalization Of The App Industry Can Be Expected To Continue
This, and the low cost of app development imply that the app part of the software industry has the potential to become truly global. For example, as of June of this year, developers in twenty-three countries contributed at least 1000 apps to the more than 350,000 apps Flurry measures worldwide.
There are already examples of worldwide app hits that were developed outside the United States. For example, Angry Birds was developed by Finland based Rovio and has become a worldwide success with hundreds of millions of downloads. The same applies to Cut the Rope, which was developed by Russia-based Zepto Labs and Fruit Ninja which was developed by Australia-based Half Brick Studios.
Three key factors suggest that the markets for apps and app development will become increasingly global.
First, the App Store and Google Play take a lot of friction taken out of software distribution in the app world.
Second, the market is already very large and growing quickly in many parts of the world. In July of 2013, Flurry tracked 1.15 Billion monthly active devices. As our results have shown, there is still some ‘home field advantage’ for local developers, but in theory developers anywhere can create apps for users anywhere.
Third, the cost of development is still relatively inexpensive, especially if you factor in the average salary of software engineers in countries like the Philippines, The Ukraine, and Brazil. The cost of promotion is rising, but total costs are still a fraction of the cost of development, packaging, distribution, and marketing packaged PC software.
In short, geography is becoming increasingly irrelevant in the Post-PC Era.
Android has been a hot topic lately, with some arguing that it may become a unilateral smartphone superpower and others arguing that it has already peaked in the US market. A lot of this conversation seems to assume that Android’s (and by extension, Google’s) gain is Apple’s loss and vice-versa. We believe that the situation is more complex than that.
Two facts about Android are now well established: 1) Android smartphones now dominate many markets in terms of device shipments, but 2) The market for Android devices is famously fragmented. What’s less well-established is how and when all of those Android devices are being used and the implications of that for participants in the Android ecosystem and beyond. Those are the topics that we tackle in this post with a particular focus on Samsung devices and how their owners compare to users of other Android devices.
Smartphones Dominate On Android
This posts builds on a previous one we did exploring how people use iOS smartphones and tablets. As we will show, there are many similarities in usage patterns across the two operating systems, but one big difference is the overall breakdown between smartphones and tablets. In this May sample of 45,340 Android devices (of the 576 million Flurry measures), 88% were phones and 12% were tablets. The share of devices represented by smartphones is significantly greater than in our iOS sample, in which 72% of devices were phones. The emphasis on phones over tablets was even greater among Samsung devices in our sample: 91% were smartphones and 9% were tablets.
As in our previous post, we started our analysis by considering how the smartphone versus tablet distribution varies by psychographic segment. These are Personas, developed by Flurry, in which device users are assigned to segments based on their app usage. An individual person may be in more than one Persona because they over-index on a variety of types of apps. Those who own more than one device may not be assigned to the same Personas on all of their devices because their app usage patterns may not be the same across devices.
The Personas shown above the “Everyone” bar in the graph below skew more toward phones than the general population of Android device owners, while the Personas shown below the “Everyone” bar skew more toward tablets. (Android device ownership patterns for Personas not shown are not statistically different from those shown for “Everyone.”) In general, these follow a similar pattern to the one we saw for iOS. On-the-move type Personas, including Avid Runners, skew toward phones and more home-bound personas, such as Pet Owners, skew more toward tablets.
Within that broader pattern, there were differences based on the particular Android smartphone or tablet that a person owns. Samsung is the dominant manufacturer of Android devices. Its phones represented 59% of the phones in our overall sample of Android phones, and its tablets represented 42% of the tablets in our sample. Both its products and its promotion suggest that Samsung attempts to differentiate itself from other devices that share the Android operating system, and those differences were reflected in persona memberships.
Samsung Is Building A Unique and Attractive Audience
Owners of Samsung devices were disproportionately likely to be in many personas, including some of those most sought-after by advertisers (e.g., Business Travelers and Moms). Since Persona memberships are based on over-indexing for time spent in particular types of apps, this suggests that Samsung device owners are generally more enthusiastic app users than owners of other brands of Android smartphones and tablets.
Overall, owners of Android tablets spent 64% more time using apps than owners of Android smartphones. This ratio varied by category, as shown in the chart below. For example, owners of Android smartphones spent more than five times as much time, on average, in Business apps as owners of Android tablets. Sports and Photography were other categories that heavily favored phones. As with iOS, Education and Games skewed more toward tablets. (Average time spent using app categories not shown does not differ in a statistically significant way between Android smartphones and tablets.)
Once again there was variation by manufacturer. Overall, owners of Samsung phones spent 14% more time using apps than owners of other Android phones and owners of Samsung tablets spent 10% more time using apps than owners of other Android tablets. The particular categories of apps where time spent was greater for Samsung phones were News Magazines, Tools, Health and Fitness, Photography, and Education. Owners of Samsung tablets spent more time than owners of other Android tablets in Communication (e.g., voice over IP and texting) apps.
Android app use peaks between 8 and 11 pm. Comparing the two types of Android devices, a greater share of tablet use takes place from 3pm until 11 pm and a greater share of phone use takes place from 11 am to 3 pm and overnight. While the overall amount of time spent on Samsung devices is greater than for other Android smartphones and tablets, the overall time distribution throughout the day is similar.
Can Samsung Compete At Both Ends Of The Market?
As this and our previous post have shown, while smartphones capture more time in specific app categories, such as Navigation and Photography, those tend to be categories of apps used in short bursts. Tablets are favored for longer-duration app categories, such as Games and Education, and so, on average, tablet users spend more total time using apps than smartphone users. That makes tablets particularly interesting to content creators and to advertisers.
Samsung is the dominant manufacturer of Android devices. As shown in this post, it is attracting a unique audience relative to other Android devices. Owners of Samsung devices spend more time in apps than owners of other Android devices, and they are also disproportionately likely to be members of psychographic segments (Personas) that are attractive to advertisers. In those respects, they are more similar to owners of iOS devices than owners of other Android devices are.
But compared to iOS, a smaller share of Android devices are tablets, and that percentage is even smaller for Samsung devices than for Android as a whole. So the question is: will Samsung make as big of an impact in the tablet market as it has in the smartphone market?
In some ways, this comes down to a question of how it will balance its resources between two different types of markets: relatively more affluent countries that were early adopters of connected devices so new growth is now coming mainly from tablet adoption versus less affluent countries where smartphone penetration is still relatively low, but growing quickly.
A focus on tablets could enable Samsung to better develop more of a true ecosystem of its own (especially considering that they can include connected TVs as part of that) and the higher profits that go with that. Riding the wave of global smartphone growth is more of a high volume / low margin strategy. Of course, they could try to compete at both ends of the market, but each individually may require a lot of resources because of Apple’s (and to a lesser extent, Amazon’s) strength in the tablet market and the number of hungry competitors anxious to grow along with the Android smartphone market. If they can do both, they will rule the Android Kingdom, and Samsung, rather than Google, will pose the greater threat to Apple.
Smartphones and tablets have gone from being the latest gadgets for relatively affluent people in relatively affluent countries to ubiquitous devices in mainstream use in many countries around the world. In fact, as we reported in February of this year China surpassed the US to become the country with the largest installed base of connected devices as measured by Flurry Analytics. As we also reported, a second wave of countries around the world is now experiencing the type of growth mobile pioneer countries experienced previously. For example, the mobile markets in the BRIC countries are now all growing faster than the mobile markets in the U.S., U.K., and South Korea.
Knowing that the landscape is constantly shifting, we are beginning a series of blog posts reporting on the use of smartphones, tablets, and apps in particular countries and geographic regions around the world. Given China’s world-leading installed base and considering the China Joy conference (China’s largest digital conference) is this week we thought we would begin there.
In June of this year Flurry Analytics measured 261,333,271 active smartphones and tablets in China. That represented a whopping 24% of the entire worldwide connected device installed base measured by Flurry. The chart below documents the growth in the installed base. The left axis and blue line show China’s growth over the years. The right axis and red line show growth in the world as a whole (including China) a basis of comparison. As can be seen from the gap between the two lines growing through 2010 and much of 2011, growth in smartphones and tablets in China lagged the world as a whole through that period. But starting toward the end of 2011, the installed base in China began a period of exponential growth. During this period it surpassed the growth rate for the world as a whole, as shown by the blue line catching the red line in the graph. We expect China to maintain its leadership (in terms of active installed base) for the foreseeable future because device penetration rate is still relatively low and much opportunity remains, as we reported in a previous post.
Xiaomi Is A Local Manufacturer To Watch
Examining a random sample of 18,310 of the devices in our system in China that run iOS or Android apps revealed that Apple and Samsung are the top two device manufacturers, as they are most everywhere. China’s own Xiaomi was a strong third, with a 6% share of the market, ahead of HTC, Lenovo and a multitude of others. As we noted in a previous post, Xiaomi has been successful in accumulating a large number of active users for each device model it releases. Worldwide, only Apple, Amazon, and Samsung have more active users for each device model released.
It will be interesting to see if Xiaomi can continue to gain share in China – possibly by mopping up share from smaller manufacturers of Android devices – and also if they can begin making gains in other markets outside of China to become more of a global player. With rumors of a Xiaomi tablet circulating, we will also be watching to see if their entry into the tablet market will increase the use of Android tablets in China. Currently 21% of the iOS devices in our randomly drawn sample were tablets compared to only 4% of the Android devices.
Chinese Users Over Index in Reading, Utility, Productivity
In looking at how Chinese people use their connected devices we see similarities and differences compared to the rest of the world. As a general rule worldwide, games dominate time spent in apps measured by Flurry Analytics, and China is no exception. On average, Chinese owners of iOS devices spent 47% of their app in games. The percentage of app time devoted to games was even greater for Android at 56%.
Smartphones and tablets are not just about fun and games in China. Compared to iOS device owners elsewhere, the average time Chinese owners spend using Books, Newsstand, Utility, and Productivity apps is greater than the rest of the world (1.8x, 1.7x, 2.3x, and 2.1x respectively). On average Chinese owners of Android devices spend more than seven times as much time in Finance apps (7.4x) than Android owners elsewhere spend in Finance apps, but they also spend more time in Entertainment apps (1.7x).
Will China’s Exponential Growth Change The Device And App Markets?
It will be interesting to see how China now having leadership in terms of its installed base will impact the device and app markets elsewhere. Given Xiaomi’s success at building a large number of users for each model it releases, it might try to add further scale by expanding internationally – particularly to the other rapidly-growing BRIC markets where brand preferences are not already well-entrenched.
Within China itself, Chinese competitors may have an even greater advantage in the app market since cultural influences and differences are likely to be even more important in the app market than in the device market. There are already strong Chinese app companies such as Baidu and Tencent and clusters of app developers emerging in places like Chengdu
. At first they are likely to concentrate on apps for the large local market, but that may eventually lead to growing app exports. For example, the fact that Chinese consumers over-index on some more work and educational-oriented apps may encourage Chinese developers to focus on those areas and innovate, and that could lead to creation of apps that end up being adopted elsewhere in the world. We’re looking forward to discovering what app is to China what Angry Birds was to Finland
Apps are telling – they signal our personal tastes and interests. There are probably nearly as many unique combinations of apps as there are devices, and the apps we use reveal a lot about us. Based on Personas that Flurry has developed for its advertising clients, we are beginning a series of blog posts to shed light on different groups of smartphone and tablet users and their app usage patterns. Moms -- who often control household budgets and expenditures -- are considered the prime audience for many brands. So we thought, where better to start our Personas series than by examining what moms are doing with apps?
Our analysis for this post relies on iPhone, iPad, and Android app usage during May of this year for a large sample (24,985) of American-owned smartphones and tablets. Discussion of app usage is based on time those devices spent in the 300,000+ apps that use Flurry Analytics.
What Apps Do Moms Use?
Moms, like most other groups, spend a lot of smartphone and tablet time playing games. In fact, on Android, more than half of the time American Moms spent in apps was spent playing games. Similarly, on iPad moms spent about half their time in games, but on iPhone, that percentage drops to a little less than a third of their time. On iPhone, lifestyle apps capture a larger proportion of Moms' attention (12%) than on iPad and Android devices.
As shown below, the second most popular category among moms on iPhone and Android devices is social networking. On iPad, newsstand (24%) was the second most popular category, demonstrating its strength as a screen for displaying magazine type content.
Where Do Moms Over-Index?
Most mobile consumers spend a large proportion of their app time in gaming and social networking apps, so what makes moms different from the other American owners of smartphones and tablets? Across iPhone, iPad, and Android, American Moms spend more time in education apps than the general population. Also, moms who own an iPhone or an Android device spend a greater share of their app time in health and fitness apps. Unsurprisingly, moms are also heavy shoppers. Android moms over-index for time spent in shopping apps, and iPhone moms over-index for time spent in catalog and lifestyle apps. (For this post, we have honored The App Store and Google Play’s systems for classifying apps. In iOS, shopping apps can fall into either the catalog or lifestyle category, whereas Android has a dedicated “shopping” category.)
Moms Own More Tablets And Gravitate Toward iOS
Compared to other American device owners, moms are enthusiastic users of tablets. As shown below, among the general population 25% of connected mobile devices were tablets, but for moms that percentage is 35%. This could be driven by the fact that many parents use tablets for sharing games and stories with their children.
60% of the smartphones and tablets we looked at were iOS devices. (Note that this number is a function of the installed base of active devices, so does not reflect market shares from sales in recent quarters.) For American Moms, the numbers lean even further toward iOS devices. A whopping 77% of moms own iOS devices while just 23% own Android. There are at least two factors that may explain this. First, it could be a function of Moms’ greater tablet ownership since iPad dominates the tablet market. Second, surveys show that women in general skew toward iOS devices. The key takeaway is that moms are much more likely to be found using iOS devices than Android devices.
For Moms, Connected Devices Are More For Escape Than Utility
So what can we infer about American Moms based on their app usage? For one thing, it appears that they use smartphones and tablets as a refuge from their busy lives. On average, half or more of the time they spend in apps is spent on social networking and game apps. In this sense, they are not that different from other Americans, but it does show that even busy moms need to escape and socialize, and mobile devices provide a way to do that.
Apps where American Moms spend a disproportionate share of time relative to other Americans also tell us something about their more serious side. Those apps tend to be improvement-oriented: education and health and fitness, for example. Moms are using their devices to help them achieve personal goals and possibly to educate their children.
We hope this post gives brands and developers a better idea of where the coveted American Mom is most likely to be during mobile time, and what is capturing their attention. App developers can tap into this valuable group by building experiences that give moms an escape from their hectic day-to-day routine, keep them socially connected, and help them improve different aspects of their lives. Media planners who want to reach American Moms should continue to buy ad inventory in gaming, news / magazine, and social networking apps, and to weight their budgets toward iOS apps.
Over the past four years, Apple’s iOS and Google’s Android have been locked into a two horse race for mobile OS ownership. In the past year, there has been a lot of focus on the rise of Android and its lead in device market share. More recently, many analysts started questioning the true value of Android’s market share especially in the high-end smart phone and tablet markets. At Flurry, we felt that it was important to take a step back and look beyond straight device or activation numbers to simply understand what market or markets are being contested.
In this report we do just that, arguing that there is more than one race for mobile market share occurring simultaneously. We analyzed four years worth of Flurry’s data to understand who is ahead in which contests, discuss the apparent strengths and weaknesses of the competitors, and consider the implications for the overall mobile ecosystem.
Android Leads In Device Market Share
It is clear from announcements from device manufacturers such as Apple and Samsung that Android is winning the race for device market share. Flurry’s own data supports this. The number of Android devices we are tracking worldwide doubled in the past year, reaching 564 million as of April of 2013. While the installed base of iOS devices that we track has also grown over that time, Android pulled ahead in active device share in late 2012 and has maintained that position ever since. This is shown in the chart below. This lead followed a period of just over a year in which the number one spot was changing hands. Prior to that Apple dominated the connected device market following the launch of first iPhone and then iPad. Approximate launch dates of some of the major iOS and Android devices are also shown on the chart as points of reference.
iOS Leads In App Market Share
In spite of Android’s rapid rise and current lead in device market share, iOS continues to lead in terms of time spent in apps. Total time in Android apps nearly equaled that in iOS apps in March of 2012, but it has declined somewhat since then, after the launch of the 3rd generation iPad.
Considering that there are more active Android devices than iOS devices but iOS users collectively spend more time in apps, it’s not surprising that more time per device is spent in iOS apps than in Android apps. The exact proportion of time spent in apps per Android device relative to iOS devices is shown below.
Why Doesn't App Share Follow Device Share?
An obvious question that arises when looking at the charts above is why app usage shares don’t follow device shares. We think there are at least three possible explanations.
One is that at least up until now the two dominant operating systems have tended to attract different types of users. Once Apple established the app ecosystem many of the consumers who purchased iOS devices were doing so to be able to run apps on those devices. They were buying a computer that fit in their pocket or purse. In contrast, many Android devices were provided free by carriers to contract customers upgrading feature phones. To the extent that those customers were just buying replacement phones, apps may be a nice add-on, but not a central feature of the device.
A second possible reason for why Android’s share of the app market lags its share in the device market is that the fragmented nature of the Android ecosystem creates greater obstacles to app development and therefore limits availability of app content. Hundreds of different device models produced by many manufacturers run the Android operating system. App developers not only need to ensure that their apps display and function well on all of those devices, but they also need to contend with the fact that most devices are running an old version of Android because the processes for pushing Android updates out to the installed base of Android devices are not nearly as efficient as those for pushing iOS updates to iOS device owners.
The final possible explanation for the differences in device and app usage shares relates to the first two. It is that the arguably larger and richer ecosystem of apps that exists for iOS feeds on itself. iOS device owners use apps so developers create apps for iOS users and that in turn generates positive experiences, word-of-mouth, and further increases in app use.
While app share and device share are two key races in the competition for mobile supremacy, they are not the only races. Another that has been in the news recently is the race for profits, in which Apple is the clear leader. Apple also currently appears to be winning the race for developer attention – probably both because of its share of app usage as described above and because both surveys and anecdotal evidence indicate that iOS device owners tend to generate greater advertising and in app purchase revenue.
A side race that Android appears to be winning is that for the emerging world, where its lower prices and open architecture give it an advantage. Apple has taken notice of that and is fighting back with incentives, monthly payment plans and cash backs in several emerging countries. In India, for example, a Times of India article suggests that these programs have given the iPhone a 400% boost in sales in the past few months.
As we’ve shown, there are multiple contests for mobile market share occurring simultaneously. That raises a question about whether that is a temporary state that will eventually give way to a clear overall winner or if there can be multiple long-term winners. For the moment it seems as though the consumer is winning in that they are able to choose devices from two dominant ecosystems as well as several smaller ecosystems.