Apps were big in 2020 and Kenshoo has some app marketing predictions for the new year.
The impact of 2020’s global quarantining and sheltering-in-place have increased the time people spend on mobile devices, and eMarketer estimates that US adults will end up spending, on average, more than four hours per day with mobile internet in 2020. With 88% of that time within apps, it is becoming imperative for brands to uplevel their mobile app marketing programs.
It’s no longer something that traditionally offline brands can ignore. The opportunity is just too big and—more importantly—rivals can use their apps as a differentiator to steal market share from your brand.
But while mobile [and app] usage has soared this year, app marketing budgets shrank—and aren’t forecasted to get back on the pre-COVID trajectory until 2024.
This is absolutely the recipe for innovation and opportunity!
When a market rises and companies aren’t able to take advantage of it, it opens the doors for leaders to push ahead, challengers to leapfrog positions, and new entries to make a splash. When you add in some of the bigger industry factors—such as iOS14 changes and the rise of 5G—all signs are pointing to 2021 to be an incredibly pivotal year for app marketing.
We sat down with our Kenshoo Apps experts to get a better idea about how the year will shape up for this channel.
Five App Marketing Predictions for 2021
App Marketing Prediction #1 – 2021 is the last year of the app-less/app-lite brand
In 2020, brands with mature apps were able to use them to seamlessly move their customer relationships from the physical world to a virtual one without too much disruption. Take for example that Walmart’s grocery app was the top download among all retail apps downloads in April up 460% vs. its daily average in January 2020.
However, brick & mortar brands that either didn’t have apps—or with apps that kinda just “checked the box”—weren’t as prepared. There were probably many frustrated boardroom conversations around the country with companies wishing they had put more emphasis on their app development and marketing efforts as they watched rivals grow via their app channel.
While being able to better handle the pandemic chaos because of your mature app wasn’t the impetus for why brands invested so heavily into the channel in the years leading up to 2020, one thing that has been proven out this year is that apps are an important part of building customer relationships. It wasn’t that brands didn’t see the app opportunity before COVID-19, it was just that they thought they had years of runway to get their app act together.
But, now it’s clear. Even without lockdowns driving consumers to more time spent with apps, the future current state of business is mobile and the future current state of mobile business is in apps. Look for 2021 to be the last year of brands taking the app opportunity for granted. Those who are “app-lite” will put more emphasis on beefing up the value to consumers and any brand who is still “app-less” will finally bite the bullet and prioritize the investment. This influx in app development will be accompanied by more app marketing which will drive up competition and ad prices.
App Marketing Prediction #2 – App marketers figure out how to make the best of the iOS14 tracking challenges
Last year, Apple announced its biggest step in protecting mobile consumer data privacy with specific changes that will accompany its latest operating system update, iOS14. This caused a lot of concern within the mobile marketing industry because of how it will severely limit user tracking and negatively impact mobile best-practices in the areas of advanced targeting, measurement, and optimization.
With iOS14 privacy changes—which was delayed to early 2021—each app will be required to ask for user consent to access the device IDFA (Identifier for Advertisers) and track user activity for advertising purposes. Additionally, iOS users will be able to block all requests to track at once from the device Settings. Industry experts estimate that only 10-20% of Apple device users will choose to opt-in for ad tracking.
The key thing here is that this change will impact everyone, not just certain brands or certain regions. So, while in the short-term, mobile marketers freaked out a bit, the reality is that marketers are resilient and will figure things out. Apple is offering an alternative solution to help marketers measure their programs, and while not as robust as the previous iteration, it will lessen the blow a bit.
And emerging solutions such as incrementality testing have the potential to take mobile marketing even further than it could have. Ultimately, Apple’s listed rationale behind this move is the make the mobile web a safer place for consumers. If consumers have more trust in the medium, then the long term impact could really benefit m-commerce and other mobile business models.
We predict that marketers will figure a way forward through iOS14 and be aligned with the “new normal” by the end of 2021.
App Marketing Prediction #3 – 5G will begin to have a dramatically positive impact on all things mobile
It’s not hard to imagine how a lightning-fast web could be beneficial for mankind. We know that mobile connections will be at least 10 times as fast as it is today and may one day even be 1000 times the speed as 4G. The potential impact on every category of technology is game-changing. Yes, brands will benefit, but it also will advance life-saving healthcare, aid emerging countries to raise the standard of living for their populace, and other breakthroughs that can benefit the world.
While 5G has been out since 2018, it will—as other G rollouts have shown—take years for carriers to cover the globe and for consumers to switch over to newer devices. Once ubiquitous though, the value that apps can have will significantly increase.
Consider how just a few types of apps will evolve:
Streaming apps. Regardless of video or audio, buffering will become a thing of the past, reducing the friction for consumer adoption. 4K will finally make its way to mobile devices at scale. And why stream when you can download an entire television series in minutes?
Gaming apps. Game developers will be able to build bigger and more immersive experiences that will rival even what the consoles can offer. Many gamers will migrate their playing time to mobile at that point.
Internet of Things apps. Watches, fitness trackers, refrigerators, office machines, entertainment systems, etc. can expand their capabilities and how they can help us in our daily lives. And the commercial applications of these devices in a 5G world are limitless in areas like logistics, shipping, security, healthcare, and more.
2021 will be the year that 5G will gain widespread adoption and app developers are already thinking about how they will take advantage of this technology. Expect some of the early innovators to launch and market their next-gen apps as a way to gain a quick lead against their late adopter competitors. This could really put app marketers who are stuck with 4G solutions on the defensive and facilitate even more advertising investment into the channel to counterposition competitors.
App Marketing Prediction #4 – App categories from the pandemic flourish
One of the things that many experts have been predicting is that some of the consumer behavior shifts brought on by COVID-19 will persist long after the pandemic is over. For example, the big jump in ecommerce penetration as a percentage of total retail sales will likely stay elevated and grow. Now that a new wave of consumers have experienced some of the benefits these apps can provide firsthand, they will continue to embrace them.
Of course, the pandemic didn’t just drive up mobile and app usage equally. Some existing categories exploded while new and emerging categories were able to mature.
- Big winners in the app categories included food and grocery delivery, online shopping, entertainment, and gaming.
- Other app categories that had gained some traction before the pandemic, but grew heavily in popularity in 2020 were at-home fitness, do-it-yourself (DYI), and home improvement.
- App categories that absolutely exploded in 2020 were video conferencing like Zoom, educational ones like Google Classroom, and remote working apps such as Microsoft Office.
- There were also some categories that took hits in industries most negatively impacted by COVID-19 like travel, real estate, and ride-sharing.
Success breeds confidence, and confidence breeds success. Market changes precede product development as it takes time for companies to innovate toward opportunities. We predict that in 2021, these projects that were started in 2020 will reach the market and change the app landscape. Once again, with more competition in the app space, marketing budgets dedicated to this channel will increase to help them gain users and adoption.
App Marketing Prediction #5 – A year of new best practices
With the aforementioned trends impacting the app space in 2021, we expect next year to be a major turning point for the app marketing channel. More apps, more investment, the impact of iOS14 & 5G, along with the increased focus on apps as a centerpiece to the way brands go to market are going to coalesce into a very important milestone year for the business of apps.
When a channel evolves so dramatically, best practices become outdated and new approaches are needed to remain successful. To date, app marketing has been challenging, but next year it will be even more difficult. Every step of the way, from awareness, to driving installs, increasing usage, maintaining user bases, and monetization is about to get a bit harder.
Uplevel your app marketing programs to be just as full-funnel, holistic, and strategic as to how mature advertising channels operate. Leveraging data—both internal knowledge and external signals—will be needed to make the very best decisions in this crowded market which is about to get even more crowded. Understanding the landscape and having the right competitive intelligence to navigate through those waters to go-to-market successfully will require savvy marketing.
We predict that 2021 will require new thinking and the app marketers who are able to best adapt to the shift and build the right best-practices will be able to compete.
What you will see from Kenshoo Apps in 2021
Kenshoo Apps is the all-in-one, complete solution for app marketers to drive installs & increase engagement across the app publishers that matter including Apple, Google, Facebook, and Snap.
Some of the areas that the Kenshoo Apps team are working on for next year include:
New publishers. As a leading integrator of app advertising publishers, the team is always on the lookout for new partners. There are a few out there that make a lot of sense to add that app marketers are already excited about and asking for. Our goal is to provide the most comprehensive app marketing platform in the market so having the most popular players as part of our suite of tools is one of the priorities on our roadmaps.
App marketing automation. As a leading marketing technology company for over 14 years across Paid Search, Social Advertising, and Ecommerce Channel Advertising, Kenshoo brings a wealth of experience to the table. Automation has been at the core of our platforms for years to help marketers manage campaigns, save time, reduce errors, and drive performance. Kenshoo Apps already has a myriad of powerful automation features to help practitioners to achieve their goals, and expect us to continue to develop in this area in 2021.
Data visualization. While data-driven marketing is key to positive ROI, at Kenshoo we know that it’s actually insights that can help brands make transformative decisions. In order to extract those insights, marketers need the right tools to guide their analysis. Data visualizations can help practitioners find more powerful insights faster than in data tables and spreadsheets and the interface of a platform can often be as important as the backend code. We’re always looking for ways to improve in this area and we have some exciting line items on our 2021 roadmap in this area.
Creative analysis. It can’t be understated just how important it is to get the messaging right in advertising. Having a great strategy is key, but if the creative falls flat, marketing won’t be able to drive users to action. Kenshoo sees the opportunity in how new innovations in AI and machine learning can find useful patterns of activity to spotlight which creative elements are not just working or not working—but why. One of the biggest areas that can help brands beat their competitors is with better creative and Kenshoo Apps will have more to share in this area in 2021.
Is your app also becoming more important to your business in 2021?
The app space is heating up. What may have worked in your app marketing programs over the last few years may not be enough anymore.
App marketers need the right technology to anchor their programs.
When was the last time you saw the innovative features of Kenshoo Apps? If it’s been a while—or if you’ve never checked it out—reach out and schedule a brief demonstration so you can see for yourself how it might be able to really help you out in 2021.