Are smartphones simply communication devices, or do they hold the potential to be your gateway to unparalleled business opportunities? Statistics reinforce the latter. According to Statista, the number of smartphone users worldwide has surpassed 6 billion in 2023, a number that is anticipated to grow exponentially in the coming years.
In 2022 alone, consumers downloaded a staggering 230 billion mobile applications, contributing to a mobile app industry that is expected to generate over $935 billion in revenues in 2023. If you’re an entrepreneur planning to invest in a mobile app, this guide is for you. We, at Segwitz, are at the forefront of tech strategy and execution in Malaysia and aim to arm you with the key insights needed to navigate the dynamic mobile app landscape. Excited? Let’s begin.
Why Invest in Mobile Apps?
Let’s first address a very evident question: Why should entrepreneurs invest their time, energy, and capital in mobile apps? The reasons are compelling and far-reaching.
The Rise of Smartphone Usage and Mobile Apps
Over the past decade, the ubiquitous smartphone has transformed from a luxury item to an indispensable part of our daily lives. Simultaneously, mobile apps have evolved from simple tools for games and multimedia to sophisticated platforms serving a multitude of purposes. As per a survey done on Malaysian audiences by Rakuten Insight, 75% of participants stated that they use mobile apps to make transactions, 10% used mobiles apps for telehealth care services and 45% used them for regular accommodation bookings.
A Pool of Grand Opportunities for Businesses
With users checking their mobiles every 12 minutes and spending over 3.8 hours a day on apps, specific app categories like social media and online shopping are burgeoning. These enduring trends offer vast opportunities for entrepreneurs and allow businesses to garner the most lucrative currency of the world: The attention of their prospects.
Mobile Apps Making a Mark Across Sectors
Mobile apps have permeated virtually all sectors, from entertainment and health to education and finance. For instance, as per a survey, mobile health apps were able to generate around $58.8 billion in 2020 alone. Meanwhile, the mobile gaming sector, led by powerhouses like Candy Crush and Fortnite, are breaking the record of revenue growth year by year. The same is true for every other flourishing sector globally.
Investing in mobile apps, therefore, is not just about keeping pace with the times—it’s about embracing a digital revolution that promises to redefine the entrepreneurial landscape
Understanding the Mobile App Market
The mobile app market comprises diverse types of apps—native, hybrid, and web apps—each with unique benefits. Native apps, designed specifically for iOS or Android platforms, offer the highest performance and best user experience but can be a bit resource-intensive. Hybrid apps, on the other hand, are cost-effective, offering cross-platform compatibility but may lag in performance. Web apps, accessible via a browser, provide universal compatibility but lack the sophisticated functionalities of native apps.
iOS and Android dominate the platform landscape, capturing about 99% of the global market share. While Android leads in user volume, iOS users tend to spend more, making both platforms worthy of consideration when putting together your plan for app deployment.
Lastly, consumer behavior in this market is complex and must be taken into consideration. Users demand seamless, personalized experiences, with studies showing that 25% of apps globally are only used once before being discarded. Therefore, knowing your target audience and their habits is essential to make a mark in this competitive space.
Balancing the Scales: Investment, Costs, and Monetization in Mobile App Development
Decoding Development Costs
Developing a mobile app isn’t a one-size-fits-all budget endeavor. Estimates fluctuate significantly, ranging up to $500,000. Several elements like app complexity, platform choice, design sophistication, and the development team’s region influence this cost primarily.
The Post-Launch Wallet
The financial commitment stretches beyond app launch. Budget allocation for app maintenance, updates, and marketing is a critical, ongoing expense. In fact, a wise approach is reserving about 20% of the initial development cost for future app maintenance.
Revenue Routes: Monetization Strategies
Effective monetization strategies can help balance development and maintenance costs. Popular methods include in-app advertising, in-app purchases, freemium models, and subscription services. For example, Candy Crush Saga grossed over $1.3 billion in 2020 from in-app purchases alone.
Tailoring Your Monetization Approach
Choosing the right monetization strategy depends on your app’s purpose, target audience, and market trends. It’s critical to assess the viability and adaptability of each method to ensure your financial investment yields profitable returns.
Keys to a Successful Mobile App Investment
Groundwork with Market Research and User Persona Development
Success in mobile app investment isn’t a chance game; it starts with meticulous foundation development. Undertaking comprehensive market research helps identify existing competition, current trends, and potential gaps that your app could fill. Additionally, developing user personas allows you to understand your target audience better, their preferences, pain points, and expectations, guiding you in shaping an app that fulfills their very needs.
The Power of Exceptional UI/UX
An app’s user interface (UI) and user experience (UX) play a vital role in its success. In fact, 88% of online consumers are less likely to return to a site after a bad user experience. Thus, an intuitive, visually appealing, and easy-to-navigate app can significantly enhance user satisfaction and drive engagement.
Stay in the Loop: Updates and User Feedback
In the fast-paced digital reality, continuous app updates reflecting latest trends, security protocols, and user feedback are vital to remain relevant. User feedback, in particular, offers first-hand insight into what’s working, what’s not, and what can be improved.
Treading on Thin Ice: Navigating Challenges in Mobile App Investment
Grappling with Market Saturation and Competition
Despite the enormous potential, the mobile app market is highly saturated, with competition at its fiercest. As of Q2 2021, there were over 3.48 million apps on Google Play Store and over 2.22 million on Apple App Store and these numbers have only grown since then. As an entrepreneur, it’s important to understand this dynamic and strategize to stand out amidst the sea of apps.
Addressing Technical Challenges and Picking the Right Team
Technical issues can prove to be a stumbling block for your app’s success. From bugs to crashes, these glitches can lead to user dissatisfaction and app abandonment. Choosing a proficient development team, therefore, is paramount for the app’s robustness and resilience. Furthermore, a reliable technology partner can help your app keep pace with evolving technology trends and user expectations.
Legal Boundaries: Privacy Policies and Terms of Service
With possibilities of data breaches and privacy concerns pivoting the app space, adhering to legal considerations, such as privacy policies and terms of service, is non-negotiable. Violations can lead to hefty fines and irreparable reputation damage. For instance, Google was fined $57 million under GDPR for lack of transparency in its data consent policies. Thus, it’s essential to consider these legal aspects right from the app’s inception, safeguarding user data and your business.
Seeking Expert Guidance
Navigating the complex landscape of mobile app investment can be daunting, especially for first-time entrepreneurs and businesses with little to no experience with digitization. Partnering with experienced app developers or agencies can provide a much-needed compass. Their in-depth knowledge, learned from countless projects, helps sidestep pitfalls and can accelerate your route to success.
When choosing a partner, consider their portfolio, customer reviews, and communication style. An ideal partner understands your vision, communicates transparently, and should hold a proven track record of delivering quality apps. In the past few years, Segwitz has established itself as a renowned tech strategist partner and we’ve been consistently producing top-tier mobile apps tailored to our client’s needs.
Let’s Go From Idea to Icon
Mobile apps hold immense potential for businesses both in Malaysia and around the world, but investing in them requires meticulous planning, strategic execution, and continuous innovation. Entrepreneurs must understand the market dynamics, the monetary aspects, the technology involved, and the inevitable challenges along the journey.
With the right mindset, adequate preparation, and a reliable partner like Segwitz by your side, you can chart a course to success. We encourage you to seize the moment, leverage the power of mobile apps, and write your entrepreneurial success story in the digital age. Ready to take the plunge? Get in touch with us today. We’re here to guide you every step of the way.
