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SOARING AUSSIE APP DEMAND PRESENTS OPPORTUNITIES, THREATS FOR LOCAL BUSINESS, TELCOS

Soaring Australian demand for apps is opening the doors for businesses and brands but is also posing new threats, according to App Annie, whose new report shows Australia is the eighth largest market for consumer app spend.

The app analytics and market data company’s new report shows Australian consumers spent US$1.1 billion in the app stores last year, while the New Zealand spend was US$145 million, for a global consumer spend ranking of 32.

The report shows Australians spent 276 hours per capita in Android phone apps in 2017, a number higher than both the United Kingdom and Germany, indicating highly advanced user habits and adoption, App Annie said.

But while the Australian and New Zealand market are relatively advanced versus the global market, Jaede Tan, App Annie regional director, told Telecom Times there is still significant room for growth.

“App Annie predicts that consumer spend in Australia will reach US$1.8 billion by 2022, which is over 60% growth,” Tan said. “It is crucial that all local businesses operating in Australia and New Zealand consider the state of maturity the market is in – the expansion phase.

“During this phase, consumers build an understanding of the types of apps that are most useful to them and therefore tend to search for new apps less often. As a result, engagement and spend climb as people use their preferred apps more frequently,” he said.

“ANZ consumers are advanced by global standards and are actively seeking solutions to run their daily lives through smartphones and apps. These user consumption habits are being solidified today and will only continue to grow in importance in the coming year,” said Tan.

He said that represents “a very exciting opportunity’ for every ANZ business and brand to engage consumers in a personalised, real-time way through constantly present devices.

“But [it] also poses substantial threats to those businesses that are not able to develop a first-class digital experience for an increasingly demanding target audience,” Tan added.

While the expansion stage sees downloads remaining high, growth rates slow, Tan said.

“Australia is beginning to see these patterns. Download growth has started to stabilise, remaining close to 700M total downloads in 2017 across Google Play and the iOS App Store combined, while at the same time, consumer spend is growing dramatically – likely at an accelerated rate when compared to similarly mature markets, thanks to the high average income in Australia,” he added.

Tan said Australia’s large spend and high per capita use of apps also had implications for telcos, which “need to take note and tailor their service offerings in terms of data plans, partnered and proprietary content.’

Globally, app spend hit $81.7 billion in 2017, with Asia-Pacific driving nearly two-thirds of the global spend thanks to China – the world’s largest market at $62.4 billion spend, or 40% of worldwide spend.

Come 2022, App Annie is forecasting annual consumer spend to hit $157 billion – up 92% on 2017 – with the average annual consumer spend per device up 23% to US$26.

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