TigerSpike urges GCC firms to leverage on mobile platform

Companies in the Gulf region should leverage on short messaging service (SMS), mobile sites and basic mobile applications as consumer trends point to a set of demographics and social dynamics that support this technology, says Nic Newman, managing director for Europe, Middle East and Africa (Emea) of TigerSpike.

The Gulf, with its mobile usage reaching triple-digit levels, has been considered to be well placed to host future growth for companies seeking to tap the financial potential of mobile technology platforms.

Kuwait-based Global Investment Houseestimated the GCC’s mobile penetration rate to stand at 195 per cent by 2012 as competition in the regional telecom industry intensifies. UAE has the highest mobile usage level in the region at above 200 per cent, growing annually at an average of over 25 per cent, according to a report published by the investment company.

“Two things that are currently shaping the Middle East telecom market are very high usage of instant messaging and increasing popularity of social networks. The region has a huge penetration of what we call medium-functionary handsets such as BlackBerry,” Newman explained.

Mobile applications have become revenue generators for several companies worldwide. The global app industry is actually expected to post revenues of as much as $15.1 billion (Dh55.5bn) in 2011, according to research firm Gartner. This hefty forecast has been attributed to the surge in Google Android’s market share.

Making money from apps

Gartner also estimated that the lion’s share or about 81 per cent of the mobile apps downloaded this year will be made for free. However some companies such as those in the media and social gaming industries have taken advantage of apps to generate earnings.

Asked when a company should monetise their apps and charge for content, Newman said it really depends on the value of the content.

“As a company, are you making money through advertising revenue or can you make genuine money from your content because it’s in demand? Those are the decisions that companies have to make right from physical things like publication to web, all the way to applications,” he said.

He also mentioned that there should be no difference between pricing for the app and a company’s normal pricing strategy.

“However the key issues that we see are companies deciding that apps should be free when there’s a genuine way to monetise them. It’s also deciding what model you want. It could be free with advertising, everything behind a paywall or free with in-app purchase,” he said.

Tablet PCs, which is starting to obtain a huge following in the region, will likewise influence how companies can monetise their content, said Newman.

“[Tablets] have become excellent devices for consuming content. The first to really use tablets well are the publishing and media companies. Magazines and newspapers presented their content in a completely different way, but they were careful not to make the same mistake they made in the web because now they know that they can effectively monetise their content through stores like iTunes,” he said.

Challenges in adopting mobile technology

TIgerSpike, a United Kingdom-based digital services provider specialising in mobile and social media, has been working with companies in the region in addressing growing interest in the mobile platform.

Newman said that while the desire to move their virtual presence into the mobile-sphere, some companies fail to take a strategic approach into developing their mobile products.

“The classic mistakes we see are people piling in too quickly, too early and not thinking strategically enough how mobile fits with their other mediums. They also think that mobile should be the same as their website when of course it should be a completely different service,” he explained.

Citing their recent projects in the region as an example, Newman said in developing the apps for TimeOut Dubai and TimeOut Abu Dhabi they used the exact same content as those published in the magazine but with a location-based feature.

“Most of the companies we work with have a physical and a web presence. What we’ve noticed is the best companies think very long and hard before developing their own site or app. And once they start, they do it very well because they’ve learned from other’s mistakes,” Newman said.