A passenger pairs with a Safe Boda rider in Kampala recently. Safe Boda is one of the most used apps in Uganda. PHOTO | KELVIN ATUHAIRE
There are billions of dollars in the mobile app industry. This is
encouraging news to those with mobile apps or thinking about developing
one.
For the last five years, Mr Derrick Lyazi, an android
programmer, gave up on developing mobile applications due to high
investment needed to push the application amongst the public and there
is no guarantee for positive results.
Mr Lyazi says after many
unsuccessful endeavours, he searched on Internet on how to make money on
mobile apps. Since most developers concentrate on service applications,
the game applications industry is much bigger than the former.
“There
are people willing to spend on mobile games, they either integrate
their ideas to the app or promote it to make money out of it. The
clientele is international in most instances. A developer can sell their
mobile application games on websites such as Flippa.com, IK
project.com. You simply create a game and put it on Google Play Store,
issued a unique ID. The developer inserts into Google Play description
of the game and it goes live,” he says.
“This is an industry that
has given me some money. It is sustainable and reliable; you simply
create, and put it up and people pay you for the ownership. An App can
go for more than $1,000 (more than Shs3.6m) on flippa.com depending on
the level of stages, uniqueness, creativity and others,” he adds.
Mr
Lyazi has been able to make two to three apps every month for the last
three years. The more investments incurred in an app, the higher chances
to get a highest bid or more returns.
When you are selling an app,
he says, one has to show that it is receiving downloads. This calls for
investing in promotions and marketing.
“However, sometimes you have
limitations to put out the best, on average, I earn between $80 (about
Shs290,000) and $120 (about Shs430, 000) and my highest bid has been
$1050 (about Shs3.8m). I have found that profitable than incurring more
resources on pushing out an app to the market. There are people who will
promote the apps to make more returns from them,” he says.
It is a
different story for Mr Allan Rwakatungu, the proprietor of Xente, who
envisioned to expand his horizon to a digital mall away from the usual
physical malls. Xente is a digital mall and digital wallet that people
and businesses use to purchase products through cashless payments.
Just
like a mall, Mr Rwakatungu says, Xente is a market place that
aggregates different brand products into personal and business apps.
“Customers
come to our app to purchase products easily and conveniently. In
addition, we provide our customers with digital wallet fund from mobile
money, Visa and MasterCard that makes it easy for them to make payments.
We take a small cut from every transaction made,” he adds.
Economic environment for apps
Apps or tech businesses are hard like any other business, especially in developing countries.
According
to Mr Rwakatungu, tech businesses require investment in building
competent teams, building the product and acquiring customers.
“Market
fundamentals are not in our favour. Our African markets have structural
problems such as low incomes, illiteracy, limited access to smart
phones and computers,” he says.
Mr Rwakatungu says despite the
challenges, the opportunity is huge. He says the market is still virgin
and people are looking for solutions to make their lives easier to live
whilst saving time and money.
“There is still need to encourage
innovation, embrace failure as a natural outcome of innovation and if we
work hard and smart enough, we will crack the market,” he adds.
Available
statistics indicate that about 100 apps are uploaded to the market
daily of which 35 per cent of those make an impact on the market. In
Uganda, there are many apps cropping up daily which gives modern app
users experiential fatigue.
“You will find that most people today
limit their frequent daily interaction to utmost three apps. Ideally, if
you are creating an app, find out whether your product assumes or
encourages frequent usage by a customer, says Ms Samantha Niyonsaba,
Future Lab lead at The Innovation Village.
Earning money from apps
Ms
Niyonsaba says the success rate of an app is at 0.01 per cent meaning
chances of failure are very high. To be among the top three frequently
used apps, you have got to consider factors that make your app
commercially viable and some of the critical questions to ask yourself
are: What would interest your target market? What is competition doing?
And most importantly your budget.
For one to make the app viable for
the marketplace, Mr Micheal Niyigeteka, Information Technology
Consultant, says in order to succeed with apps business, a developer
needs to know the problem they want to solve, is the problem eager
enough for people to pay for it?.
He says with untraceable market,
one needs to understand the user and what technology they have access
to, what are they spending on, for instance, how much is spent on data
bundles.
“You need to understand the different dynamics, is it for a
social cause and probably looking for a funder who will fund the
investment or you hope it will become such a popular app for many people
to use,” Mr Niyigeteka says.
If one’s app becomes popular, some of
the big players in the industry like Google would want to engage you
due to the value associated with your work.
For starters, an application to generate revenue could be designed as a revenue driver or incorporates advertising.
“For
example, Jumia is a good example for revenue driver, one is purchasing
stuff and money is transacted,” says Mr John Birungi Babirukamu, digital
director QG Saatchi & Saatchi.
One can make money off
advertising through google adverts. He says one of the largest
applications from 2010- 2015, Candy crush earned 300 million
installations. It was making most of its money off adverts together with
some small purchases.
Why Apps don’t break even
Mr
Babirukamu says the problem with applications locally is they don’t
have the numbers. MTN mobile money is the largest application across
with about six million users. The only way you can get such users is if
you are using the very basic form of application for a person to use
which is Unstructured Supplementary Service Data (USSD).
“We have 28
million people with phones in Uganda, only about 9million have smart
phones. That means a whole 19 million don’t have access to the internet
based applications. Even a huge number of smartphone holders, nearly 50
per cent are basic entry level users,” he says.
He adds that the
problem with app developers is that they build mobile apps, web
applications and ignore the USSD. Having USSD opens your application to a
wider market. By default without USSD, you are cutting out many people
on smart phones.
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