State of Mobile 2020 — Consequences for Fintech and Retail
With over 3 billion people using smartphones every day, it’s hard to neglect the fact that mobile technology is ubiquitous and it’s going to stay with us for long.
What does it mean for fintech and retail — the two main industries we work with at NextApps?
I would like to present the insights from App Annie report about the state of Mobile 2020 I had a chance to get familiar with last week.
What’s the report about?
App Annie gathered information and insights about the way we consume time, money and ads on mobile. Let’s dig into these topics, especially in regards to fintech and retail.
Time on mobile rises year over year
With Internet speed allowing us to use Netflix or watch live streaming while we commute, mobile is constantly stealing our time. An average user spends 3 hours and 40 minutes on their phone, not mentioning the time consumed on desktop. It’s 35% more than in 2017.
Both fintech and retail businesses can benefit from the fact as it means we spend more time using financial and retail applications either to track our finances, withdraw cash or make purchases.
Consumer spend on mobile hits 2.1B USD
The amount of money we spend through mobile devices by gaming, shopping or using our phones as wallets is constantly growing. Compared to 2016, we spend on average 2.1 times more in 2019.
While the number of application downloads has flattened, there’s a significant rise in the amount of money we leave in mobile e-commerce and other applications (in-app purchases). Around 70–79% of stores revenue comes from gaming, making it the biggest beneficiary of changes in the way we use mobile devices.
Advertising on mobile
Advertisers and media companies made mobile one of their biggest ad advertising platforms. So we can notice a 49 year on year growth in the last three years when it comes to advertising. We can say for sure that while the time we spend on mobile devices is getting longer, we are able to interact with mobile content in longer times spans.
Youtube and other social media seem to be the right place to advertise products and services.
What does it mean for retail?
Mobile adoption is also one of the biggest growth factors for retail. We noticed 20% year on year growth in downloads of retail applications such as e-commerce stores and loyalty platforms. The time spent in the stores grew by 30%, which means that not only we download more apps, but we spend more time in the ones we already use.
Though buying online is both simple and convenient, I think there’s one more factor that comes into play here. It’s a global movement towards eco-solutions. People want to leave less carbon footprint, make more healthy and pro-eco choices. That’s why a lot of them either work remotely or are getting used to it.
We don’t need to go to the store in person to make a purchase. We don’t need to get stuck in traffic. We don’t need to drive a car.
Making it possible to buy through a mobile app seems to be like an eco-friendly idea that a lot of companies can go after.
What does it mean for fintech?
The Fintech revolution started not so long ago and it completely changed the way we interact with our finance. It also came with the rise of insurance or financial products born outside of banks.
An average consumer uses stock apps, checks their bank account, makes money transfers and uses their mobile phone as a payment device.
Looking at the 2016–2018 landscape, both mobile banking and fintech apps notice growth. Users accessed finance apps 1 trillion times in 2019, which topped the result from 2017 by 100%. What’s worth noticing, 94% of millenials are more likely to participate in loyalty programs if offered on mobile.
Wallet apps made by fintech companies seem, on average, to engage consumers with 1 session per week more per user. However, this number is the result of an enormous impact of Chinese and South Korean market at which fintech applications generate 3 or even 4 times more sessions per user than banking applications. More conservative consumers (Canada, Germany, UK) still put their trust in banks rather than their fintech counterparts.
The biggest concern is app security.
Summary: what comes next?
With Generation Z engaging with brands on mobile 60% more than older generations, I expect that businesses will start moving most of their activities to smartphones or even wearables.
As much as we tend to break new records in the amounts we spend on mobile, startups still need to encourage their consumers to use new mobile payments methods. Legislation and regulations aiming to enhance security standards should follow. Looking at the speed with which fintech unicorns are born (7 in 2019), it should not be that hard, though.
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I am a fan of new mobile technologies and biometric identification, leading a development team at NextApps — a boutique software company working with fintech and retail sector.
