The last decade has seen incredible progress for mobile. Smartphones have moved from a communication utility and entertainment distraction to playing an expanded role in our day-to-day lives: grocery shopping, dating, payments, health monitoring, and much more. What does 2016 hold for the mobile industry?
Here are several trends we can count on seeing.
Mobile app saturation and mobile ads — move toward personalization
Throughout 2015, an increasing number of apps were submitted to the app stores—currently as many as 4,000 in a single day. To rise above the noise, companies ranging from emerging startups to Fortune 500 leaders are spending more on mobile marketing than ever. With mobile advertising spend nearly tripling in 2015, we’ll continue to see large investments in mobile ads in 2016 and beyond, ranging from large traditional ad spenders – like personal finance, travel, e-commerce and CPG companies – to mobile game companies. Already, eMarketer projects mobile ad spending, which surpassed desktop spending for the first time this year, to reach $42 billion in 2016. While Facebook and Google are likely to benefit most from increased mobile ad spending, there are a number of mobile advertising companies that are experiencing strong growth by innovating on publisher-centric solutions. For example, U.K. startup LoopMe recently closed a $7 million round to expand its mobile video platform with real-time retargeting of ad campaigns and interactive ads. Consumer personalization will be a key trend as app stores continue making changes to surface a more relevant selection of apps through custom landing pages and improved search.
Mobile gaming enters next stage of innovation
In 2015, the $20-plus billion global mobile games market surpassed the console market in size. Three mobile game companies reached over 114 million consumers through multimillion-dollar Super Bowl commercials, and the year culminated with traditional gaming market leader Activision acquiring Candy Crush Mania developer King for nearly $6 billion. Console leaders such as Nintendo and Square Enix announced plans to rapidly expand into mobile games, and Konami went a step further with intentions to go all-in on mobile.
In 2016, expect to see more headlines around mobile games innovating in adjacent areas including e-sports, fantasy sports and VR/AR. Online worldwide esports viewership is estimated to exceed 375 million by 2018, and early standouts have emerged like Vulcun and AlphaDraft to bring contests to gaming spectators. Companies like Mobcrush and Kamcord, on the other hand, have made mobile game broadcasting and viewing incredibly easy for everyone.
While most of these markets are still developing, we’ll likely see several breakthroughs that set the foundation for rapid acceleration in 2017 and beyond.
Millennials go mad for mobile video
Not since the introduction of the television has the consumption of media and entertainment shifted so rapidly — especially with millennials today. Smartphone usage takes up a large part of millennial teens’ lives. A recent Adobe study found that 92 percent of millennials in the U.S. consider the smartphone to be their primary device for watching TV when on the go. In a typical day, 98 percent of 18- to 34-year-olds reported using smartphones to watch video content. In 2015, we saw a breakthrough with Amazon and Netflix garnering a handful of Primetime and Daytime Emmys for content. That being said, none of the winners were targeted at millennials. In 2016, expect to see at least one show targeted at millennials win an Emmy.
Wireless carriers are leading the charge in this area, as companies like Verizon and T-Mobile invest heavily in infrastructure to support mobile video streams as well as acquire mobile exclusive rights. T-Mobile last month announced a “Binge On” program, which offers free mobile video streaming for content consumed via apps that include Hulu, Netflix and Sling TV. Verizon still owns exclusive U.S. mobile-streaming rights to NFL games on smartphones in a four-year deal inked in 2013. Programs like these could offer the needed boost to smaller video content providers and support consumers’ viewing habits that have increasingly shifted to mobile.
Mobile device functionality redefined by the Internet of Things
While IoT is still in its infancy, expect it to cross mass-market penetration in 2016. As these services are typically accessed by customers on-the-go, mobile devices will remain the central monitoring and control hub for much of the IoT. We’re already seeing this with the concept of a “smart home:” automate the temperature settings with Nest, turn existing light switches on and off with Switchmate, and secure your home with a Dropcam monitoring camera. This trend should accelerate as mobile voice command technologies — Siri, “OK Google” and Cortana — continue to improve on mobile devices, obviating the need to awkwardly open an app to provide a command. However, don’t expect one killer IoT application to drive the market. Rather, a broad array of devices/applications will flood the market commensurate with the lower cost of enabling wireless and sensor technologies, related application development and a corporate push to access more useful consumer data. In fact, one study suggests that by 2022 over 500 smart devices in a household could be connected to the Internet.
While the year ahead will contain many surprises, one thing is certain: 2016 will be yet another giant year for mobile. The industry is changing quickly, and those who can keep up with the changes will lead the charge into the New Year.
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