The “New World” of Mobile Applications Going Global

The story of Columbus's discovery of the New World is probably familiar to everyone. One of the most well-known details is that Columbus believed that the land he arrived in America was India, and he called the local residents "Indians". It was not until later that someone investigated South America that they concluded that it was not Asia but the "New World". Since then, a new chapter in human history has been opened.

The purpose of telling this story is to illustrate that finding the right "new continent" often means a turning point in destiny for individuals and groups.

2022 is jokingly called "the first year for Chinese Internet workers to graduate" by netizens. It is not difficult to see that after the growth rate of China's Internet industry has slowed down year by year, it has entered a mature stage. Want to take a step forward? Going overseas has become a consensus among mobile application developers and Internet companies.

Going overseas is not uncommon. A few years ago, the scenes of Chinese Internet applications expanding wildly in the United States, Europe, India, Southeast Asia and other places are still vivid in our minds. But obviously, you can't find the "new world" with the "old map". If I tell you that the third world such as Africa and South America are becoming overseas paradises for mobile applications to go overseas, you may find it unbelievable. But there are a lot of practices, facts and data that show that the direction of application going overseas has indeed changed.

If we regard going global as a game of conquering new continents, then its existing data has been reset. In the new copy, there are new tasks and levels waiting for Chinese developers to challenge. In this article, we will disassemble the strategies for mobile app going global one by one.

New dungeon: New world from T1 to T3

Today, why to go to sea is no longer a question. But where to go to sea and which continent is the copy full of gold coins and rewards is the first step to go to sea.

There are many ways to divide overseas markets. According to the continent: Europe, North America, South America, Africa, Southeast Asia; according to the market: Japan, South Korea, Hong Kong, Macao and Taiwan, India, Thailand, Indonesia, the United States... Games going overseas are generally divided based on language, economic level, cultural characteristics and other aspects, and divided into T1, T2, and T3. Given that games account for the largest proportion of applications going overseas, we continue to use this method:

T1, mature market, complete infrastructure, high-quality users, strong willingness to pay, such as the United States, Europe, Japan, South Korea and other developed countries and regions.

T2, emerging markets, with rapidly maturing infrastructure, significant growth rates, and low customer acquisition costs, such as Thailand, Vietnam, and Indonesia, which are rapidly developing in Southeast Asia.

T3, a potential market, has average infrastructure, but a large population base and growing Internet traffic have brought about a vast blue ocean, such as Latin America, Africa, and some relatively economically backward developing countries in Southeast Asia.

These three types of markets are like three copies, each with its own difficulty.

T1 is undoubtedly a golden market, with relatively good monetization and brand power. But at the same time, competition is also very fierce, and the challenges such as installation costs, promotion and marketing, and policy compliance are also the greatest. It is suitable for developers who are confident in their product capabilities and hope to establish brand influence.

The T2 market has been growing steadily, the network environment is relatively good, and the payment capacity and Internet penetration rate are also on the rise. However, it has also long been a bridgehead and back garden for China's mobile applications to go overseas. For example, in Indonesia, Vietnam, Thailand, Singapore and other places, there are a large number of Internet giants and companies that have laid out their businesses and opened up many niche tracks. Products with differentiated advantages can try their luck here.

In the T3 market, the Internet penetration rate is at a low level, which means there will be greater growth potential in the future. The competition is not as fierce as in T1\T2. The growth rate of downloads of overseas applications is very impressive, which is suitable for some developers who are new to overseas to try their hand.

For example, in populous countries such as Brazil and Mexico, the average daily Internet usage time is more than 8 hours, far exceeding the global average. The population and economy of sub-Saharan Africa are also growing continuously, and the Internet population dividend in these regions has yet to be released. The per capita GDP in Middle Eastern and North African countries such as Saudi Arabia, the United Arab Emirates, and Turkey is relatively high, with strong demand for the Internet and strong ability to pay. However, it should be noted that compared with the T1 and T2 markets, these regions have weaker monetization capabilities. Choosing the right track and doing a good job of operation, it is not a dream to achieve low investment and high returns in the T3 market.

Of course, there are still some markets with greater instability, and developers with less overseas experience are not recommended to try them.

For example, due to the war, Google and Apple froze the country's payment process, which once caused Russia's share of Eastern European game spending to drop from 50% to 10%. In addition, the ban on Chinese Internet applications in India and other places has also led to a significant decline in the number of Chinese application downloads in South Asia since 2021, with a drop of 22.2%.

Since the beginning of 2022, the trend of Internet going overseas has become increasingly obvious. Giants such as Alibaba and Tencent have begun to increase their layout in overseas market segments. At the same time, a large number of small and medium-sized Internet companies and developers are also planning or have already gone overseas.

With hundreds of boats competing in the same stream, if you want to be the first, you naturally have to choose the route that suits you and move forward courageously in the copy where you can play to your strengths.

New Challenge: Changes in the Track, Even if the Distance is Long, It Will Be "Red"

In the overseas market, there is a popular saying, "Even if it is far away, it will turn red", which means that no matter how far away or blue the market is, it will eventually turn red. For today's developers, going overseas is both a last resort and a dangerous one. There is no longer the "happiness" of large-scale replication and rough marketing when the Internet "tools went overseas" around 2010.

If you open the rankings of overseas regional application markets, you will find some changes in the overseas track.

1. Tool applications are receding, and diversified layout is being adopted. Tool applications are not affected by local culture, religion, etc., and do not require large-scale operation and promotion, so they can quickly open up the market. Cheetah Security Master, Battery Doctor, Eggplant Quick Transfer and other tool applications are all star products in the previous wave of "going overseas". However, as Google, Apple and others increase their supervision, a large number of tool applications that are close to monetization methods have been removed from the shelves. In this round of "going overseas", Chinese mobile applications have further increased their layout in multiple tracks such as games, social networking, streaming media, and e-commerce, which also tests their comprehensive localization capabilities.

2. Competition intensifies with the entry of giants. The mainstream track is highly concentrated and has become a red ocean of competition, with many giants and large companies occupying the market. In the top 30 Chinese game manufacturers' overseas revenue list in 2022 announced by Data.ai, it can be found that game brands such as Tencent, Mihoyo, Lilith, and Nuverse are leading the way, among which Tencent ranks first in the overseas revenue list. The top three Chinese non-game manufacturers' overseas revenue list are continuously occupied by ByteDance, Joyy Group, and Tencent. In addition to the "involution" of Chinese Internet giants, going overseas will also face the siege of global applications, especially at a time when global Internet giants are working hard to expand everywhere, it has become very difficult for small and medium-sized enterprises and developers to stand out.

3. Technology iteration, high innovation threshold. In this case, many Internet companies and developers have set their sights on innovation in some vertical categories, such as Internet finance, music, etc. However, with the rise of new technologies such as AI+5G+IoT+cloud, the technical threshold for creating high-quality products in these potential tracks is getting higher and higher. For example, the fourth place on the list of Chinese non-game manufacturers' overseas revenue is PictureThis, a product for identifying plants, which has achieved high growth in North America and Western Europe. The company behind it, Ruiqi Software, started out as an image and video processing software and is currently focusing on computer vision. Obviously, the difficulty of creating a hit product has also increased.

Frankly speaking, the days of making money comfortably for today's overseas applications are over. However, this does not mean that there are no opportunities. At least for the majority of users, there is always a desire for new things. As long as this mentality remains unchanged, opportunities will always exist. At the same time, the epidemic and the digital economy have also activated many new demands.

For example, stimulated by the COVID-19 pandemic, the total market size of online media such as global video, music and games is expected to grow from US$17 billion (approximately RMB 110.09 billion) in 2020 to US$35 billion (approximately RMB 226.65 billion) in 2025. This huge market has attracted many competitors to join. Platforms such as Viu, iQiyi, and WeTV have found that Korean dramas have a very high influence in the Southeast Asian market, and even provide Korean drama content for free to drive growth. This is exactly the exploration of potential classification and hidden needs.

In addition, the digital infrastructure of the T3 market has been accelerated after the epidemic, providing a broad space for development for overseas companies. The "Internet Overseas White Paper 2022" mentioned that the financial technology, e-commerce, social entertainment, games and other industries in some countries in the T3 market deserve special attention. For example, the huge demand for financial technology services from users and the strong support of the government have led to the rapid development of Mexico's financial technology business. It has become one of the main financial technology systems in Latin America. Credit, payment, insurance and other businesses have great development potential. Fashion e-commerce companies such as SHEIN and ChicPoint have achieved high downloads in Middle Eastern markets such as Saudi Arabia by relying on localized operations. In a sense, China's mature Internet applications have been well tempered in the market and have product attractiveness. If they can be combined with the local culture and user characteristics of the T3 market, there is hope that they can achieve "dimensionality reduction strikes" during the rapid development period.

Games have always been the category with the highest proportion of applications exported overseas, and they have maintained a growth trend. The 2022 Game Focus Report released by data.ai (formerly App Annie) in cooperation with International Data Corporation (IDC) shows that in the first quarter of 2022, consumers spent more than $1.6 billion per week on mobile games on iOS and Google Play, an increase of 30% over the pre-epidemic level. Therefore, there is still a lot of room for growth in the game track. At the same time, the increase in the proportion of mobile games has also led to some unprecedented changes in game applications, such as real-time online functions being the most popular, nearly 50% of top mobile game consumption in the United States tends to be female players, and regulation has pushed game data privacy and security to become a top priority...

In general, with the universalization and popularization of mobile networks and mobile terminals around the world, mobile applications have also begun to enter thousands of households, forming a variety of colorful market segments. Those who leave me, yesterday cannot be retained, and now is still the best time to go overseas. However, it is worth noting that the entry threshold and monetization difficulty of the international market have also increased. For overseas players who break into global dungeons, equipment naturally needs to keep pace with the times.

New equipment: Changes in the abilities of overseas players

How cool is it to export tools? The answer is that there are hundreds of millions of downloads and fierce advertising and other monetization income without complicated promotion and operation. The improvement of platform supervision, the upgrading of data protection policies in various places, and more mature users after market education have all put forward higher requirements for the ability of overseas applications. At the same time, the industry structure is also changing.

In the past, when we mentioned the challenges of going overseas, we liked to emphasize the lack of understanding of the cultural policy needs of unfamiliar markets, the difficulties in localized operations, limited promotion and customer acquisition resources, and the need to ensure business reliability, etc. However, times have changed.

In the past, it was not a "must" for applications to go overseas, and some developers and companies did not have a deep understanding of the overseas market, which was normal. But today, there are a large number of overseas companies, service agencies, and industry summits that can provide experience exchanges and sharing, the industry's supporting capabilities have been significantly enhanced, and localized one-stop services are no longer new. Therefore, developers and companies going overseas at this time rarely know nothing about the target market and are at a loss for overseas business.

In addition, in the past, going overseas required adapting to differences in local infrastructure such as networks, computer rooms, and CDNs. Now, with Huawei Cloud, Alibaba Cloud, and Tencent Cloud expanding their service networks around the world, as long as you choose a reliable cloud service partner that suits you, your overseas applications will basically not encounter too many problems in terms of network latency, business sustainability, and elastic expansion.

This is equivalent to all players entering the game wearing basic equipment and standing at the same starting line. At this time, the competition is to inlay new ability gems for differentiated attribute upgrades. Which new attributes are the skill points that must be lit up?

1. The shield of security and compliance. At present, 80% of the countries and regions in the world have implemented or are in the process of privacy and data protection legislation. Not only does Western Europe in the T1 market have the most stringent privacy law in history, GDPR, but various network regulations in Germany, Japan, South Korea, and the United States are also very comprehensive. The T2 and T3 markets have also followed up in a timely manner and continuously increased their supervision. For example, India has introduced the "Data Protection Act" and Brazil's "General Data Protection Law" will also take effect in September 2020. There are also rumors in the industry that Egypt may establish a Media Oversight Committee to rectify social apps from overseas. In short, security and compliance have become the foundation of a mobile application and a compulsory course for going overseas.

2. A diversified ecosystem. Generally speaking, with the help of the security capabilities of the application platform, data compliance and privacy protection can be ensured quickly and easily. The App Store and Google Play have relevant compliance policies and a large number of users. However, events such as the Indian ban and Google's removal of a large number of Chinese apps require overseas developers to maintain a strategic awareness and conduct diversified distribution and layout to avoid business stagnation and serious damage due to certain reasons.

3. Low-code agile development. What should you do if you don't want to put all your eggs in one basket, but there are not many platforms to choose from? Many developers or companies will choose to launch multiple apps to disperse the wind direction, which brings a lot of development tasks. Therefore, it is very attractive to create applications with low-code (sometimes code-free) drag-and-drop operations and intuitive UI to speed up application development time without outsourcing or hiring more developers. According to TechRepublic data, 75% of app stores are gradually transitioning to low-code platforms in 2021.

4. Innovation to support commercial realization. The fundamental purpose of application going overseas is to obtain higher growth and commercial returns. Commercialization capability is the basic guarantee for going overseas and the ultimate goal. But as mentioned earlier, the stage of wild growth has passed. Today, strong commercialization capabilities will only grow from product strength. Looking at the excellent application going overseas cases, we will find that new technologies such as machine vision, intelligent voice, NLP, AR, etc. are becoming a breakthrough for application innovation, helping products to achieve functional innovation, user identification, accurate reach, security protection and other capabilities. Take Switzerland as an example. It is one of the most promising mobile game markets in Western Europe in the T1 market. The game consumption capacity is strong. Because the penetration rate of mid-to-high-end mobile phones is high and the mobile network speed is higher than the world average, high-quality games can open up in Switzerland. The improvement of game image quality is inseparable from the deep adaptation and optimization of hardware and algorithms. In addition to the developers themselves constantly building the core competitiveness of new technologies, if the development platform can provide tools with low thresholds to access new technologies, it will also bring direct help. Only with product advantages based on new technologies can we get rid of homogeneous competition and lay a solid foundation for commercialization.

For Chinese mobile application developers, it may be cruel. Trapped by the reality of traffic reaching its peak, they have no choice but to go overseas. But isn’t this the beginning of a new world?

Columbus set sail not for the stars and the sea of ​​​​self-realization, but because the authorities wanted to find a new route and re-establish trade with Asia. It was by accident that he discovered the "New World", which completely changed the history of the world.

Zweig wrote in When the Stars Shine that at the great moment when fate arrives, all the virtues of citizens - caution, obedience, diligence, and prudence - are useless. Fate - another god in this world, is only willing to lift the brave up high with warm arms and send them to the paradise of heroes.

It is worth looking forward to. Developers - the adventurers of our time, are accelerating on the path of finding the "new world". Glory and wealth will be the rewards bestowed by the times on the brave.