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Published On: Thu, Oct 12th, 2017

Article: What Makes Apps Thrive in China's Mobile Landscape

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Josh Ong
Director, Global Brand Strategy and Communications
Cheetah Mobile

China’s unique social and economic conditions cause its mobile app landscape to differ from most other parts of the world, and apps with certain characteristics have a greater chance of going viral in the market. eMarketer’s Man-Chung Cheung spoke with Josh Ong, Cheetah Mobile’s director of global brand strategy and communications, about why some of China’s most popular apps rose to the top—and whether their success can be exported to other markets.

eMarketer: What are some of the fastest-growing app types in China?

Josh Ong: One of the top ones is short video apps like Douyin, Kuaishou and Huoshan. The social aspect of these apps creates a lot of virality for sharing videos. We’ve also found adoption not just in the mega-urban metropolis, but also in lower-tier cities and almost rural areas of China.

Bike-sharing apps have also exploded. Users have recognized that vehicle ownership is expensive, and getting around the city is important.

The multiplayer online battle arena [MOBA] games have exploded as well with Tencent’s Honor of Kings. MOBAs have been extremely popular on PCs, both in the West and in Asia. Honor of Kings has demonstrated the potential for mobile to capture a piece of that market.

eMarketer: Why have these types of apps grown so quickly?

Ong: There are two features that help apps take off in China. One is social features, which you see in Honor of Kings, video apps and photo apps. The second is online-to-offline [O2O], such as apps that facilitate things like bike-sharing, new retail models or ecommerce. These are opportunities to grow a user base and drive consumer transactions, which have a lot of monetary potential in China.

“The monoculture and monomarket aspect of China gives the social apps much more power and makes consumers easier to capture.”

eMarketer: Can these apps replicate their success overseas?

Ong: Markets can be more fragmented outside of China. If you build a viral app in the US, you have to play with Facebook, but you also have to consider whether your target demographic is on Snapchat, Instagram Stories—which is part of the Facebook ecosystem but a very different beast from the Facebook app or Messenger app—or Twitter. Then there’s Line, Kik and WhatsApp. There’s a huge variety.

eMarketer: What about O2O apps? Can they find success in other markets?

Ong: The monoculture and monomarket aspect of China gives the social apps much more power and makes consumers easier to capture. Trying to take those strategies overseas is a little more hit or miss.

There is certainly plenty of potential in Western markets. In the US, there are services like Postmates, Seamless and other delivery apps. But China has some advantages that make it easier for O2O apps to survive. Some of it is pure population density in cities. In addition, the cost of labor is lower, and this business model works better with tighter margins.

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