The ‘app store’ is the future for mobile: Naspers CEO

In a world where the smart phone is becoming ever more dominant, the app store is becoming key to success for an e-commerce business, according to Naspers [JSE:NPN] CEO Bob van Dijk.

In 2014, the number of mobile devices exceeded the world’s population, which stands around seven billion. Cisco says in its Mobile Network report that monthly global mobile data traffic will surpass 24.3 exabytes by 2019. There are one billion gigabytes in an exabyte.

“Globally, smart devices represented 26% of the total mobile devices and connections in 2014; they accounted for 88% of the mobile data traffic,” the report explains. “In 2014, on an average, a smart device generated 22 times more traffic than a non-smart device.”

Within the world of smartphones, app stores have become the new Google, explained Van Dijk.

“If you develop great apps that customers will like, then app stores will be your partner to ensure people see it on their screens,” Van Dijk explained in an interview with Fin24 on Tuesday.

“The world is becoming rapidly an app-first world, where your position on the consumer’s screen is really crucial,” he said. “We [Naspers] are ranking in the top five with most of our e-commerce apps.

“I think what it mainly requires … is to think quite differently about how we interact with customers and how we market it,” he said. “App stores are in many ways partners in that trajectory.

“As Google has been partners in reaching customers in the desktop world, you see app stores being partners in an app-based world. It requires you to change your marketing approach drastically.”

Van Dijk said that apps have the same goals as websites in that they want to “offer a good proposition to the customers that they will like.

“So if you have the right apps, the app store will be a partner in getting it on people’s screen. If you don’t have a good app, app stores will try to do their best not to get your app in front of customers.”

He said Naspers is investing in emerging markets where mobile internet scales up fast. India, which he said ticks this box, is currently their biggest investment market.

Core headline earnings for Naspers for the year ended March 31 2015 grew 30% to R11.2bn, while development spend investment increase 33% to R10.7bn, the JSE-listed company said in its results.

Naspers was trading 0.45% higher at 10:50 on Wednesday at R1 903.61.

* Fin24 is part of Media24, a subsidiary of Naspers. Naspers has a 34% stake in Tencent.

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The ‘app store’ is the future for mobile: Naspers CEO