Mobile Apps-Changing the Business Landscape

"Consumers are now addicted to always, anywhere, anytime connectivity, and the next 12 months will see them push their mobile lust to obsessive, occasionally nearly insane degrees," says David Mattin, lead strategist at Trendwatching.com. This lust of mobile phones is being driven by apps. The number of app downloads have reached humongous levels of 2 billion and 2.5 billion per month on iTunes and Google Play respectively. Mobile apps have led to new, innovative and profitable business models which have changed the business landscape. We examine some of these models here.

App Category: Messaging Popular: Whatsapp, Nimbuzz, Hangout, Facebook Messenger

A free app with features like real time group chat, voice chat, picture messaging, and videos which work over cellular data. The app has transgressed the national and international boundaries with free messages even while roaming. Whatsapp has ended the hegemony of SMS and messengers like BBM to become the de facto messaging tool for smartphone users. On June 13, 2013 Whatsapp recorded a massive transaction of 27 Bn. in one day! As of August 2013 the chat has 300 million active users. The mobile service providers are now trying to bundle their data services with messenger services.

App Category: Mobile Banking Popular: SBI, HDFC, ICICI, Citi

Banks have realized that Mobile Apps are the most appropriate instrument to reach the masses. All of these apps provide many standard services allowing transfer of funds, paying of bills, ticket booking, buying movie tickets; recharging of mobiles and DTH; locating an ATM, and more, on the go. A physical transaction at a branch costs Rs 40-60, an ATM transaction costs Rs 15-20 while a mobile transaction costs Rs 1-1.5. Only 5% of our rural population has access to banking services. With smartphones becoming cheaper, mobile banking apps will be the tool of choice for inclusive banking.

App Category: Health and Fitness Popular: MapMyWalk, Fitocracy, Weight Loss, Diet Assistant
Mobile apps are a revolution in the Health and Fitness Sector. Several business models are followed which range from providing calorie count of food items, working as a pedometer, creating a detailed workout plan to achieve fitness goals and mashing up video game features with fitness workouts for motivation and fun. The Nike+iPod Sports Kit, measures and records the distance and pace of a walk or run. Thus one can easily track ones exercise schedule and change it accordingly. Nike Inc.'s Equipment division saw an 18% rise in profits for the 2012 compared to its -1% loss during the 2011 fiscal year. Health awareness is rising but people have less and less of time. Apps which allow users to track and improve their health and fitness in an enjoyable, informative way, at their own comfort provide a huge business opportunity.

App Category: On demand Ridesharing Popular: Flyte, Uber, Taxi Beat, Get Taxi, Side Car
The app has a community of ride-givers, when somebody wants a lift, he/she is matched with one of the ride-givers or, the app ties up with cab drivers and cab service providers. The communication is synchronized between commuters in such a way so that they can share the cab if they are travelling to the same destination. There have been several instances of Taxi Unions campaigning against these apps. The two most popular apps Lyft and Uber have claimed to have received Cease and Desist letters from local authorities on frivolous grounds apparently on the behest of taxi unions at some time in every city they operate in! The

services do not share figures on how popular they are, but the opposition towards them suggest they pose a very real threat to as we know it Taxi service.

App Category: Local Business Most Popular: BookMyShow, Zomato, JustEat

BookMyShow allows customers to compare movies & rates across cinema halls for booking tickets for Movies, Events, Theatre and Sports. Zomato aids in searching for restaurants by location/cuisine/name. JustEat helps one to order food online from a catalogue of restaurants. In short, they help mobile users discover local business. The discovery is made useful by using users location, preferences etc. BookMyShow has a lion's share of India's more than 12 million e-commerce customers, translating into about 30 million tickets annually. PVR has signed a deal of Rs. 1000 crore over five years to reach its target customers. Zomato has more than 42,000 restaurants across 12 major cities of India and 4,000 restaurants in Dubai listed on it. It had a turnover of around Rs. 11 crore in the FY 2013.

App Category: Photo sharing Popular: Instagram, Facebook, Flickr, Picasa

An online photo-sharing, video-sharing and social networking service that enables its users to take pictures and videos, apply digital filters to them, and share them on a variety of social networking services. Instagram has democratized the art of image making and has become the new polaroid of the era. Its 130 mn. user base has shot some 16 bn. of photographs till date. Companies like General Electric, Maersk Line, etc. have joined Instagram to reach out to their target customers. Instagram has spawned an ecosystem of services such as photo-editing, printing and delivering of photos. It has plans to bring its own camera by 2014. Facebook acquired a majority stake in Instagram for $ 1 Bn after realizing its potential. Globally, mobile users are expected to outnumber desktop users by 2014 and the amount of time spent on mobile devices is growing: now an average of 82 minutes a day, which is more than twice the amount of time spent just two years ago. The mobile engagement being driven by Apps is here to stay and will spawn many new business models. Its imperative that businesses make place for apps in their strategy.

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