Lesson 4

Mobile Maturity Model

An app is developed, released, updated and changed many times along its journey to success. This is a maturation process that most apps go through as they evolve from a simple application to major driver of revenue. The maturation process for app adoption within a company follows a predictable trajectory that we’ll examine here.

Individual App Maturity Model

Within the context of an existing company, introducing an app into a corporate ecosystem can be a slow and occasionally fraught process, as you work to convince business leaders that an app will contribute to your company’s bottom line. We see three distinct phases in the app maturity model, but not every company or app will move through all of these phases.

Still, understanding the process can provide helpful landmarks as you think about your own path forward.

Phase 1: Marketing-led Creation and Strategy

The first phase of an app may be led by marketing efforts, when someone on the team says, “We should try this as an app!” (Which may or may not be a good idea, as we’ll review in Strategize.) This type of app is often an extension of a company’s web-based marketing efforts, and may include basic information and limited functionality. It’s relatively simple to execute and can be built by an external company. It requires few security considerations and needs little to no backend development.

Phase 2: Mobile-Specific Development

The goal of the app at this phase is to improve and enable new opportunities, instead of simply porting existing business. It takes advantage of mobile-specific qualities like GPS, cameras and in-app payment options, for example, and will require more intensive resources as the functionality begins to integrate with other backend systems. At this point in the maturity model, the app should generate mobile-specific opportunities and advantages.

Phase 3: Revenue Growth Plus Dedicated Mobile Strategy

In Phase 3, a company’s app is directly generating revenue and/or delivering significant cost-savings. It’s integrated in a sophisticated fashion with the larger company and requires a team (or teams) dedicated to the app’s maintenance and development. For mobile-first companies, the app is now the primary driver for leads, opportunities, revenue and more.

Overall App Market Maturity Model

When looking at the app economy as a whole, there is a predictable movement through emerging markets into mature markets, with specific results and app usage behaviors in two stages. Here is a quick look at the app market maturity model.

Stage 1: Emerging Markets: Downloads Rise Rapidly

In the early stages of market maturity, downloads grow rapidly as the installed base of devices begins to take off and new device owners explore the ecosystem and build their app collection. Right now, India and Indonesia are emerging markets for apps and are experiencing hyper-growth in downloads. Markets with huge downloads signal to publishers that they need to decide when and where they should get their foot in the door for an early advantage. This early download growth lays the foundation for future gains in app usage and revenue.

Stage 2: Maturing Markets: Usage and Revenue Grow

Over time, download growth levels off. Users in more mature markets become more engaged with their go-to apps and abandon those that don’t meet their needs. Mature markets like the US and Japan are shifting from a download growth phase to one characterized by expanding app usage and revenue growth. There will still be a large number of absolute downloads, it’s just reached its peak number, as app usage and time spent in apps goes up and up. This increased engagement leads to revenue growth via in-app advertising, in-app purchases, and mobile commerce that takes place outside of app stores.

 

Keep Learning

In the next lesson, we'll summarize how the mobile platform has changed how (and where) businesses operate.

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