Five on Friday: App Store, GDPR and SaaS Back-up
Featuring Mobile Marketer, Adweek, Forbes and Motley Fool
In this week’s Five on Friday, a recent report by App Annie shows spending in the App Store has doubled to $42.5 billion, Adweek says GDPR is an opportunity to build trust with customers, Search Data Backup offers best practices for backing up SaaS data, financial experts share opposing opinions about Pandora’s future, and Forbes explore the growing subscription box industry.
App Annie: App Store Generated $42.5 Billion in 2017
A recent report by App Annie shows the App Store generated $42.5 billion in revenue in 2017, almost double the spending from two years ago. App Annie forecasts compound annual growth rate to be about 12 percent from 2017 to 2022. If the App Store hits that level, it will generate an estimated $75.7 billion in 2022. A number of subscription companies made the list of the top five apps, aside from games: Netflix, Tencent Video, Tinder, iQiyi and Pandora Radio.
Here are a few more highlights from that report:
- Since July 2010, nearly 10,000 apps in the App Store generate more than $1 million in consumer spending.
- More than 4.5 million apps have been released in the App Store. In May 2018, more than 2.0 apps were available.
- More than 170 billion apps have been downloaded between July 2010 and December 2017.
- In 2017, iPhone users in the U.S. had an average of 96 apps installed and used 37 apps monthly.
- Games account for 31 percent of downloads but 75 percent of spending.
GDPR: Limitation or Opportunity?
While many are feeling the doom and gloom of General Data Protection Regulation (GDPR), now in effect in the European Union, Adweek offers another perspective – this is an opportunity to rebuild trust with valued customers. Adweek estimates that close to $70 billion in programmatic advertising could be subject to fines and penalties for those not in compliance with GDPR, explaining the reason the new regulation is feared by many marketers.
However, GDPR stemmed from some very real problems – data breaches, misuse of data, lack of transparency, and the quality (or lack thereof) of digital advertising, to name a few. Consumers and the EU government have essentially said ENOUGH! They are taking back control of their data. Rather than fearing the new rules, Michael Priem, founder and CEO of Modern Impact, encourages marketers to view GDPR as an opportunity to rebuild trust with customers.
‘They reset the balance between advertiser and audience by giving consumers more control, directing technology to be employed for more noble uses and compelling marketers to interact with consumers in more meaningful ways that create positive sentiment and ultimately restore trust. After all, trust is what this entire game is about,’ he writes.
Read more about Priem’s perspective in ‘How GDPR Offers an Opportunity to Rebuild Trust with Consumers’ on Adweek.
4 Best Practices for SaaS Backup
If you are backing up SaaS applications like Salesforce, Office 365 or G Suite, you need to be sure you are following best practices. In a recent article for Search Data Backup, Stuart Burns offered nine best practices. We’re sharing four of them here:
- Redundancy is important, so you aren’t relying on your provider to give you access to your files. Seek our cloud-to-cloud backup services that back up your SaaS of choice.
- Unfortunately, outages are inevitable, so make sure you have a SaaS backup and disaster recovery plan in place, so you’ll know what to do and how to do it when the time comes.
- Test your backup and disaster recovery plans to be sure they’ll actually work when you need them to.
- Have multiple backups in case the one you were counting on fails.
For more on these best practices, read Burns’ original article on Search Data Backup.
Will Pandora Survive? Two Investor Opinions
Pandora has been in the red for years, and while it has experienced some recent successes, the company is still posting huge losses. How is the company doing now? It depends on who you ask. Seeking Alpha says Pandora is copying YouTube and it is working. The Motley Fool, however, says that Pandora’s new plans won’t be enough to save the company.
Seeking Alpha: Last week, Max Greve spoke in favor of Pandora. Greve says Pandora is copying YouTube – not its streaming music competitors – as it tries to find its way in a competitive marketplace. Rather than focusing on audio ads or subscriptions to find sustainability, the company is focusing on visual ads, improving both monetization and consumer experience. Yes, subscription revenue is growing, but Greve points out that this is offset by the content costs. Bottom line: he is pro Pandora.
The Motley Fool: On the other hand, Rick Munarriz said in a May 31 article that Pandora’s new premium family plans will not be enough to move the company toward profitability. While subscription revenue grew by 61 percent, the number of active listeners and listen hours has dropped. Pandora will need a lot more than family plans to compete with similarly priced services like Apple Music and Spotify.
We tend to agree with The Motley Fool. We’ve written about Pandora enough to know that the company has been in the red for a long time, and small tweaks to its offerings and a revolving door of CEOs have not pushed Pandora into the black. We are doubtful Pandora has found a success formula that will move into a profitable position anytime soon.
The Subscription Box Industry Keeps Growing
Despite some recent acquisitions like Kroger’s merger with Home Chef, the subscription box industry is alive and well, says Andria Cheng for Forbes. In fact, in the first quarter of 2018, 18.5 million Americans visited a subscription box site, a 24 percent increase year-over-year, reports Hitwise. In February, a McKinsey study said 15 percent of online showers have signed up for one or more subscriptions on a recurring basis (I’m among them – I subscribe to two subscription boxes and a half-dozen or so other digital subscriptions).
Even major retailers are getting in on the action, says Cheng in ‘The Subscription Box Industry is Getting More Crowded Than Ever.’ In addition to the Amazons and Walmarts of the world, Target, Sephora, Bed Bath & Beyond and JCPenney all have subscription boxes. On the meal kit front, companies like Blue Apron and Purple Carrot are experimenting with expanding beyond the meal kit subscriptions to retail sales in grocery stores.
In a separate article for Forbes, Richard Kestenbaum says that, in terms of monthly visits to subscription box websites, the market has grown by 890 percent in 2017 since 2014 (data from Hitwise). The top sites visited, as of April 2018, were Ipsy, Blue Apron, Hello Fresh, Stitch Fix, Dollar Shave Club and Home Chef. The greatest percentage of site visitors are seeking out food subscription boxes (34 percent), beauty boxes (33 percent), apparel (17 percent) and lifestyle (12 percent). For more data, read ‘The Subscription Box Business Continues to Grow and Change’ on Forbes.
Bottom line: There is more and more interest in subscription boxes. In some segments, the industry is starting to mature, but interest in the top categories (food, beauty and apparel) remains strong and is likely to stay that way in a strong economy.