APP MARKET TRENDS & 2016 OUTLOOKApp Promotion Summit, BerlinPatrick KanePRIORI DATAFounder & CEO@pdkane

www.prioridata.com

Agenda1. Priori Data Background2. State of the (App) Union3. 2016 Outlook

1.PRIORI DATA BACKGROUND

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Me: Trying to Change the Status Quo in Mobile App Market Data

Nationality: US, now camped in an Eastern American outpost (Berlin)

Twittering: @pdkane & @prioridata

Gamer?: Lots of hours. Lots of parent frustration. I now sneak in 30mins a day on mobile or build cities (Skylines) during sleepless nights

Before going “Start-up”: I analyzed and invested in information companies, mostly in the healthcare space

Talked to: hundreds of publishers over the past 2 years, plus, yes, just about as many VCs

Patrick KaneFounder / CEO

Ex.

PRIORI DATA BACKGROUND

Confidential 5

OUR MISSION

Our mission is to crowdsource the world’s largest panel of mobile app data.

We want to deliver reliable statistics on any app, publisher and market trend

WE ANALYZEAPP STORES

Founded June 2013International team of 22

WIR SINDEIN BERLINER

PRIORI DATA BACKGROUNDUs: Powerful App Store Intelligence at a Better Value

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Public Data crawled from

the app stores

Proprietary Data shared

by ourpartners

Download and revenue estimates for all apps,

publishers, and categories across 57 countries

MARKET TRENDS

COMPETITIVE INTELLIGENCE

NEWCOMER DETECTION

CUSTOMIZED WATCHLISTS

Over 10,000 Apps Have Joined Our Free Data Sharing Network

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PRIORI DATA BACKGROUND

2.STATE OF THE (APP) UNION

STATE OF THE (APP) UNIONMobile Is Only Working For The Top 1%

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Supply / Demand Imbalance

Broken Discovery

Market Concentration

The Problem in 3 Steps:

STATE OF THE (APP) UNIONIncreased App Supply & Flat App Demand = More Competition

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Sep Oct Nov Dec Jan Feb Mar Apr

May June July

Augus

tSep Oct

75%80%85%90%95%

100%105%110%115%120%125%

Avg. Monthly Downloads Avg. # of Apps

-1%

+18%

Indexed Supply & Demand • Consumer demand has flatlined

• 500 new apps and 100 new publishers enter the store every day!

• Newcomers (and their apps) apps are as a rule better funded and more experiencedBased on Apple App Store. Since Sep. 2014

STATE OF THE (APP) UNIONTop Chart Turnover (& Discovery) Offer Only Fleeting Success

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Average Length of Stay per New App

>2 weeks 1-2 weeks <1 week one day0%

10%

20%

30%

40%

50%

60%

70%

80%

3%7%

41%

49%

1% 3%

71%

25%

Average Free App Average Paid App

• 50% of new free apps are in and out of the charts within 1 day, and 90% within 1 week.

• Only 4% of new apps last more than 2 weeks in the charts. That’s 350 a month, globally.

Based on Apple Top 200 Charts. „New“ designates first-time appearance in the top chart, not age of the app.

STATE OF THE (APP) UNIONApps Represent a “Winner Takes All” Market

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Share of Market to Top Publishers • 100 companies command ~70% of store downloads and ~60% of store revenue

• There are over 450k companies publishing apps today, Top 100 = 0.01%

% of Total Store Down-loads

% of Total Store Revenue0%

10%20%30%40%50%60%70%80%90%

100%

72%59%

9%

8%

5%

5%

14%28%

Top 100 101-200201-300 Everyone Else

Based on Apple App Store in June 2015. Global Estimates.

% of Downloads % of Revenue

STATE OF THE (APP) UNIONAnd Where is That Market Concentration, well, Concretrated?

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Top 10 Free Apps on iOS based on Monthly Downloads (Globally)

Category

Action Games

Strategy Games

Action Games

RPG Games

Sim. Games

Puzzle Games

Arcade Games

Sim. Games

Action Games

RPG Games

10 out of 10

Games

2013

0 out of 10

Games

2014 Category

Social Networking

Social Networking

Photo & Video

Social Networking

Finance

Photo & Video

Photo & Video

Entertainment

Lifestyle

Music

STATE OF THE (APP) UNIONAnd Where is That Market Concentration, well, Concretrated?

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0 out of 10

Games

2014 Category

Social Networking

Social Networking

Photo & Video

Social Networking

Finance

Photo & Video

Photo & Video

Entertainment

Lifestyle

Music

?

2015

Top 10 Free Apps on iOS based on Monthly Downloads (Globally)

STATE OF THE (APP) UNIONAnd Where is That Market Concentration, well, Concretrated?

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2 out of 10

Games

2015 App Category

Social Networking

Photo & Video

Social Networking

Social Networking

Photo & Video

Social Networking

Adventure Games

Education

Health & Fitness

Strategy Games

• 50% exact overlap with 2014

• 60% are Apple, Google, and Facebook Published

• Both gaming titles are franchises/classics

• The two you don’t recognize are Chinese

Top 10 Free Apps on iOS based on Monthly Downloads (Globally)

STATE OF THE (APP) UNIONWhat Others Say

“With over 2MM apps across the various mobile app stores, discoverability is close to impossible. User acquisition strategies are just not enough anymore, and it’s been a while since burst campaigns were viable. When looking at all these parameters, one question comes to mind: has the app gold rush finished?”

Michael Velkes, VP of Marketing at Plamee Games

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Published on Mobile Dev Memo

3.2016 OUTLOOK

2016 OUTLOOKSo Has the App Gold Rush Finished?

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2016 OUTLOOKSo Has the App Gold Rush Finished?

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Doubtful.

But 2016 will change the frame of the discussion in a major way

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Mobile Web vs. Mobile Apps

The Discussion Since 20082016 OUTLOOK

Mobile Web vs. Mobile Apps

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^andThe Discussion in 20162016 OUTLOOK

2016 OUTLOOKFred Wilson’s Summary

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“the mobile web is top of funnel, and mobile apps bottom

of funnel” “The mobile web is the window of your store. Users window shop on your mobile website. Getting them to download and install and use your mobile app is like getting them to come into the store”.

http://avc.com/2015/09/mobile-web-is-top-of-funnel-mobile-app-is-bottom-of-funnel/

- Fred Wilson

2016 OUTLOOKThe Optimal User Funnel For Marketers is a Mixture Of Web & App

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“web search (discovery) + deep links (conversion) + rich apps (engagement) + push notifications (retention)”

Patrick Kane

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So why does this notion of web vs. apps exist in the

first place?

Web and Apps are not Mutually Exclusive2016 OUTLOOK

2016 OUTLOOKThe Dominant App Stores Have Different Worldviews

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“this apps vs. browser argument is so charged partly because it’s a surrogate for Apple’s and Google’s competing visions for the mobile internet”

Greg Sterling – Editor @Search Engine Land

http://marketingland.com/morgan-stanley-no-apps-arent-winning-the-mobile-browser-is-144303

2016 OUTLOOK2016 Will See Big Changes to The Store Status Quo Impacting UA

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iOS9 and Ad Blockers

Google App Streaming

2016 OUTLOOKWrapping Up

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• Supply/demand imbalance, broken discovery, and market concentration pose fundamental challenges to the vast majority of publishers

• The “gold rush” is not over, but outperformers will look for synergies and consumer patterns that span across “web” and “apps”

• 2016 is shaping up to be a year where the major platforms take firm stands on their view of mobile – it’s going to be a wild ride!

Patrick KaneFounder /CEO

patrick@prioridata.com

Twitter @pdkaneEmail me directly for a copy of this presentation.