Asian smartphone users more willing to spend via app: Google

• More users comfortable paying via apps; business owners should capitalise
• Subscription payments picking up but needs compelling value to sustain

SMARTPHONE users across Asia have become more accustomed to the idea of purchasing products and services within apps, a trend that might become more prevalent over the next few years, according to a new study commissioned by Google Inc.

Speaking to the the media recently, Google Malaysia head of business intelligence H.C. Lim (pic, above), said nearly two-thirds of users in Asia are comfortable purchasing products and services within apps.

Lim said one of the main parameters of the study was to ask smartphone users how comfortable are they in making purchasing online.

“Not surprisingly, the majority of users were very comfortable doing so,” she claimed. “At least two-thirds of respondents said they were willing to buy goods and services via an app. This includes a product, a service or physical goods within an app such as shoes, flight tickets, cab services.

“China led the way with 89% of those polled saying that they will do so, followed by India (86%), Vietnam (82%), South Korea (78%), Thailand (78%), Malaysia (69%) and Singapore (69%).”

The Google-commissioned study took place in July and consisted of an online and offline survey conducted by market researcher TNS. Culled from a sample size of 10,000 smartphone users between the ages of 18 and 64, the survey polled users from 10 Asian countries comprising China, India, Vietnam, Japan, South Korea, Thailand, Malaysia, Singapore, Indonesia and the Philippines.

All respondents were screened to ensure that they had used smartphone apps in the past seven days prior to the survey as well as apps from various categories in the previous 30 days.

Lim said it was significant that more than two-thirds of respondents in Malaysia showed their willingness to purchase via an app and that business owners should take note of this behaviour so that they can make their marketing campaigns more effective.

“Business owners will need to track purchases along with other key in-app events as conversions,” she suggested. “They could leverage tools such as Google Firebase Analytics to record in-app actions and send to AdWords or use Universal App Campaigns (UAC) to optimise in-app events.”

To further gauge if users were willing to go beyond just purchasing online, the Google-TNS study also polled users to see if they were willing to subscribe to services or at least make one-off payments.

Lim said the results were anticipated, with many were not willing to spend on premium or subscription-based media as there are still many services that are free online.

“A majority of those polled (70%) said they would go for free online content but still, 25% of respondents in countries such as Indonesia, India, Thailand and Vietnam indicated that they would buy with one-off payments or subscribe to a digital service. In Malaysia, only about 14% of those polled indicated that they were willing to spend,” Lim noted.

Lim said there is opportunity for business owners to give their users a strong reason to subscribe or make one-off payments, and to ensure that their services have pricing relative to purchasing power, wherever applicable.

Other findings

Lim said the Google-TNS study revealed that searches on app stores is one of the most common ways users discover new apps but it was not the only way. Other methods used were recommendations from family and friends; featured apps advertised on app stores; and social networks and TV advertisements, she noted.

Users in Asia also strongly consider user reviews, ratings, app size and cost of app as other criteria for installing a new app, she added.

The cost of apps and the apps size are significant criteria in countries such as Malaysia, Indonesia, Vietnam and Thailand. The likely reasons for this are that smartphone users in these countries are constrained financially, and do not have smartphones that have large storage space, Lim argued.

She said gaming remains the most popular category of apps installed by users across Asia, followed by social networking app and e-commerce and shopping apps. On the flip side, gaming apps are also the most frequently uninstalled apps.

“Most users won’t keep an app if it is no longer useful or relevant,” she argued. “The top three reasons for deleting and/ or uninstalling apps are: ‘No relevance,’ ‘takes too much memory,’ and ‘found a better app that does the job’,” Lim said.

According to James Yeang, head of eBusiness at Maxis, the mobile operator concurs with the general observations found in the Google-TNS survey.

Yeang, who was at the briefing, said video continues to be the main driver for apps and because of this, app experience is highly dependent on the Internet quality.

“YouTube is a good example of this,” he argued. “They have begun making available 4K content (Ultra High Definition) and people viewing this kind of content would need very high quality connectivity and zero buffering.”

Yeang also noted that Maxis is also discovering that more people are now more willing to buy on their apps. “Users are also using apps as a preferred way of interacting with a company,” he noted.

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