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Top Emerging Markets for Mobile Apps in 2017

December 6, 2016

When looking at the top market opportunities for mobile app development in 2017, the best opportunities are (not surprisingly) in the developing world. In developing countries, mobile devices make it possible for the residents to leapfrog over adopting larger PCs and laptops in their tech development. Instead, they can move straight to the most convenient and cheapest option available.

top-emerging-markets-for-apps-in-2017

We’ve split those markets into 3 regions. Let’s take a look.

1. Latin America

There are some common themes that our three countries in this region share:

These populations are more willing to adopt mobile banking because they gain the convenience and security of having their money stored electronically, without the hassle of having to visit a bank to deposit cash and then carry around a bank card to use it.

a) Brazil

Brazil is the logical place to start in analysis, as it dwarfs the rest of the continent in population. With 209 million people, it accounts for 34% of the total mobile app usage of Latin America. Brazil also has only reached 70% mobile phone penetration, which is fourth for the region. If Brazil were to catch up to Chile’s rate of market penetration, there would be another 8 million mobile phone users in that country alone.

In an economy that frequently relies on cash transactions, Brazil has already shown a willingness to adopt mobile banking faster than other countries, with mobile banking currently representing between 13-20% of their transactions.

b) Mexico

As the second largest country in Latin America with 128 million people, Mexico also takes its place as the second largest user of mobile apps, accounting for 21% of all mobile app sessions for the continent.

Mexico has also demonstrated it is willing to jump into mobile banking, with adoption rates similar to those found in Brazil, ranging between 12-18%.

c) Argentina

Lastly for South America, we have Argentina. Ranked fourth in population with about 43 million, Argentina is punching above its weight, coming in third in mobile app usage with 8% of the region.

With this impressive app usage, it’s also important to note that Argentina is dragging its heels when it comes to mobile banking. With only 7-12% of their transactions using mobile devices, there is a lot of room for growth.

2. Asia

The common theme permeating throughout the Asian mobile app market is games. Countries throughout the region share this passion, and Southeast Asia is set to spend over a billion dollars on mobile games in 2017. Most of the devices used are Android, with its lowest market share of 58% in Singapore, up to a whopping 94% in Indonesia.

Mobile gaming represents two avenues of revenue and market development:

  • Apps can be free to download, with in-game advertising, and a premium, ad-free version can be sold as well.
  • Games get people using their phones more often, which means they’re more likely to download other apps and expand their number of app sessions.

a) Thailand

In 2014, Thailand generated $230.3 million in revenue from mobile gaming alone, the highest in the region, yet it has a small population for the region, and it only has 31% of its population online. This means there are plenty of development opportunities yet to come.

b) Vietnam

Vietnam shows how quickly the region is growing. In a decade, its number of internet users has grown from 4 million to 45 million — that’s 48% of the population — with 44% of the population owning a smartphone. This is another clear example of developing nations skipping desktop computers and going straight to mobile devices.

Smartphone adoption is expected to grow by 50% in the next 4 years in Vietnam.

c) Indonesia

As the fourth largest country in the world with 255 million people, Indonesia’s market is a huge opportunity, especially when only 21% of that population is online, the lowest in the region.

With growth in mobile advertising for 2016 at 150% and its population of smartphones set to rise from 40 million now to 100 million by 2018, Indonesia is developing very quickly.

3. Middle East & North Africa (MENA)

This region is the most complex market of the three that we’ve looked at. MENA already has a seemingly developed mobile market; 680 mobile subscriptions is no joke. Yet these subscriptions are highly concentrated around the Gulf states, thanks to higher incomes and infrastructure spending that oil revenue has provided.

However, the market is expected to rise to around a billion by 2020, meaning there is plenty of development yet to come.

a) Egypt

Egypt is the big growth story in the region. Between 2014 and 2015, app downloads rose 60%, while revenue rose 30-40%. Similar to Asia, Android dominates Egypt’s market, but instead of games, Egyptians have been downloading Tools and Messaging apps. With 5 messaging apps still vying for market share, this indicates a market that hasn’t yet matured, as usually a winner-takes-all market share will dominate messaging apps.

Egypt definitely has a growth spurt in it.

b) Turkey

Another market dominated by Android, Turkey saw over 85% of all apps being downloaded from Google Play. The largest categories of downloads are games, tools and mobile commerce. With younger populations and expanding infrastructure, Turkey has already captured the attention of hardware developers Apple and Samsung, and apps Zomato and Foursquare.

c) Saudi Arabia, Qatar & UAE

Lastly, we have the Gulf states. While being very different countries, in terms of app markets, they share a lot in common. With the highest incomes in the region thanks to oil and natural gas exports, smartphones have already been adopted quite readily by the population, with more than 68% in the UAE and more than 56% in Saudi Arabia.

However, with the governments of these nations seeking to diversify away from relying on oil for their incomes, and the drive to make cities like Dubai smarter, app development is going to get a big boost.

Furthermore, these markets have relied on importing apps, with little native development occurring. This presents the opportunity to take ideas that work overseas and tailor them to the local market, something which has yet to happen.

Across these 3 regions are quite a few different drivers of growth, but they share a few things in common: the use of apps is growing fantastically quickly, and yet, large chunks of their populations are yet to buy a smartphone.

That won’t last much longer though.

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