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Consolidation – THE new mobile apps game?

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Any industry goes through a consolidation phase as part of its maturing process? Is the mobile app industry next? Are we there yet? 

I recently read about the re-branding (following a merger) of app promotion company PlayHaven and analytics provider Kontagent, now known as Upsight. As any app marketer would testify, without app analytics you are totally blind. Once you have the enlightening information available, you need the right tools to act upon this information in order to drive better stickiness, usage and loyalty for your app. Hence, the combination between analytics and promotion tools coming from the same company, complementing each other’s offering makes total sense to me. Criteo’s recent acquisition of Adx makes another valid example, and there are more…

The new, merged company, called Upsight, is now forming and time will tell how competitive and valuable it will be to its customers. But I do want to share a few thoughts that came to mind as I was reading this news item:

Smart consolidation can solve some real pains for app developers

  • Hectic confusion – Most of us in the mobile app industry find ourselves confused when trying to understand the differences between the varieties of 3rd party providers out there. And that’s assuming we know about the existence of all the players out there. We all need to decide which tools to use for reaching our distribution, engagement and monetization goals. The self-development option no longer makes sense (it may have been relevant in the past), and you want to make the smartest decision possible for your app.  Having less, well-established players, with a complete set of tools in a certain area (e.g., engagement) can make things A LOT clearer.
  • Multiple integrations – Almost every 3rd party provider you want to work with today, no matter what for, will require that you integrate its SDK into your code. That’s becoming every publisher’s nightmare. I remember myself, so many times, bitterly arguing with R&D, trying to make them see why I need all these SDKs integrated, and why I need them NOW. Yes, most providers will say that it’s only one line of code and you’re done. But then you factor in testing to see that everything works correctly, clearing security and clashes concerns, as well as the integration work itself. The result is quite a big headache for your R&D people who always seem to be at the point of collapsing (what’s that about anyway?). And I haven’t even started talking about the multiple dashboards that you have to look at, trying to make cross references between all the information in order to make sense of it all. I would say consolidation would help here too, don’t you think?

Moving from selected niches to the mainstream

There are currently many niche companies offering very specific tools for very specific needs. Looking at other industries, as they matured, companies started to consolidate in order to create a comprehensive portfolio of offerings. I think this will happen to our industry sooner rather than later as the below becomes more difficult with every day that passes by:

  1. The need to make money in the long run
  2. The need to survive the tough competition
  3. The need to create stickiness with existing and potential customers – if you’ll be embedded in so many places within their operation, it’s really going to be too complicated for them to leave you.

I am now wondering, who will end up being the buyers and sellers in this consolidation phase that I believe is coming to the mobile app industry. I already have some ideas…

We can’t ignore the fact that this industry is very strong in partnering. Everybody is partnering with each other, as they are all going after the same target audience (publishers, developers, brands, etc.). For example, aggregating information from several providers into a single SDK, providing a single dashboard reflecting info from a few ad networks, and more and more. This is, in my opinion, the testing phase, where companies test each other. This is the phase that precedes real M&A style consolidation. 2014 is going to be an interesting year people! Stay tuned…

Tsipi Joseph
Tsipi is one of AppGo2Market.com Co-Founders, a mobile expert and a mentor. Over 10 years of experience in the mobile and marketing industry: Director of Marketing at Telmap, Comverse and marketing professional development director at the American Association of National Advertisers.
Tsipi Joseph
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