60% Apps On Google Play Succeeded Due To Gaming And Freemium Model In Q1 2014 [REPORT]

With the increasing dominance of Android, number of apps, downloads and revenue generated from Google Inc. (NASDAQ:GOOG) Play Store is also growing multi-folds. The Play Store now boasts of 1.5 million apps with 50% increments in downloads from first quarter of 2013 to Q1 2014. App Annie, app analytics firm, prepared a comprehensive report covering all aspects of Google Play Store including downloads, revenue generated, country-wise and category-wise growth. This growth is largely driven by the massive adoption of apps those which are offering Freemium model to users and, in turn, helping developers to generate sizeable revenue.

Highlights of the Report

• In June 2014, number of total apps on Play Store reached 1.5 million.

• The quarterly app revenue doubled from Q1 2013 to Q1 2014.

• In Q1 2014, U.S. and Japan topped the list of most downloads and revenue generated, respectively.

• Gaming apps accounted for 90% of Google Play app revenue in Q1 2014.

• Freemium apps generated the 98% of app revenue.

Apps Grew By 60% In A Year!

In July 2013, the number of apps in Google Play Store had crossed the 1 million mark, while they are over 1.5 million this month. The large requirement of apps on Google is the result of the massive dominance of Android in the smartphone market. However, the reach of Android has also attracted the malicious apps that went up significantly in numbers.

Interestingly, only two out of top five countries by the number of Google Play app downloads are not in the list of too 9 countries by Google Play App revenue. Brazil and India, at second and fifth largest country by Google Play app downloads, failed to make to the list of top 10 countries on Google Play by app revenue.

Brazil: The Fastest Growing Country By Google Play App Downloads

On Google Play, the quarterly app downloads recorded a 50% year-over-year growth from the first quarter of 2013 to the same time period in 2014. The gaming apps on are the most preferred apps for downloading while the non-gaming apps accounted for 40% of the downloads in Q1 2014. The communication and tools apps registered the maximum downloads after the gaming apps. Both the categories recorded an outstanding growth of 50% year on year. Surprisingly, the social and entertainment apps failed to garner downloads despite of growing number of social media users. The growth of communication apps is pegged to messaging apps like WhatsApp and WeChat. Freemium and free apps are the most downloaded apps on Google Play Store.

All the major markets, led by nation with advancing economies, registered a positive growth in the Google Play app downloads. U.S. maintained its first spot with 20% year-over-year growth in Q1 2014, while Brazil recorded the maximum growth thereby jumping from 7^th spot to 2^nd spot. India and South Korea, though recorded a positive growth, lost their earlier position by 2 ranks. South Korea and India finished at 4^th and 5^th position, respectively.

Freemium Apps Account for 98% of Google App Revenue

The growth of Google app revenue is almost double the download growth. The app revenue grew by an astounding 140% from the first quarter of 2013 to Q1 2014. Though the countries like India, Russia and Brazil are among the top-5 downloading nations, they lag behind South Korea and Japan in paid apps market. In Q1 2014, the maximum app revenue for Google Play came from Japan, followed by U.S. and South Korea.

The report also touched-based few section of Google Play store, recorded till the mid of June 2014. In May 2014 alone, Brazilians invested the most in paid apps and in-app purchases, followed closely by Russia. However, the maximum revenue came in from freemium apps. The revenue generated from paid apps and in-app purchases almost halved from May 2013 to May 2014. In 2013, freemium model apps accounted for 92% of total app revenue generated across all platforms.

Gaming apps accounted for 90% of total Google Play app revenue in Q1 2014. Apart from the gaming apps, communication and social media apps generated the maximum revenue while the communication apps recorded a year-over-year growth of 125% in Q1 2014. Though the tools apps garnered a massive download growth, they failed in the revenue segment.

Applications are not only restricted to smartphones; they are a part of wearable technology too. In the coming times we can witness their widened reach to smartwatches, smarthomes and many other gadgets. By 2017, the mobile apps are expected to generate $77 billion as revenues. The majority of revenue will come from freemium model apps, largely dependent on third-party ad monetization.

The App Annie report brings good news for the app developers and publishers both. With the increasing number of apps, revenue is surging by multiple folds with each passing year. The established and emerging economies are equally contributing to the revenue growth, which is highly based on freemium model. The gaming developers rope in the highest revenue. Emerging smartphone markets such as Brazil, Russia are driving the downloads while developed and strong economies like US and Japan are driving app revenue market.

Takeaways:

The above findings of Google Play, being the largest app store for Android, present an adoption-trend of Android apps. Therefore, for Android apps developers, its important to leverage these insights to make sure the optimum ROI from their app development efforts.

• Android app developers must focus on the United States, United Kingdom and Germany.

• Gaming industry must be the first choice for Android app developers, with a focused marketing approach on Japan and South Korea.

• Android app developers must adopt freemium model to monetise their app.