Everyone who has a mobile phone or tablet uses apps, the software specifically designed for them.
And anyone who buys apps regularly will know why recent AIM-listee appScatter Group PLC (LON:APPS) is potentially onto a winner.
It is hard enough for a consumer to sift through the variety on offer, but a buyer only has to make the purchase once.
Developers have to constantly monitor how they are doing, where they are selling well and crucially how much revenue they are generating.
AppScatter has developed a software platform that allows a developer (or owner) to distribute and manage an app across multiple stores globally.
Chief executive Philip Marcella says the idea came from his own and his team’s experience of developing almost 400 apps and having to monitor how they were performing.
Indeed, he says the decision to form appScatter resulted from an internal version that had already been a hit with his own clients.
The big misconception is that all apps are bought through Apple and Google, he adds.
While the two tech giants do account for a meaty 49% of the market currently through their hugely successful app stores, there are upwards of 500 other places you can buy apps.
AppScatter’s business is to put a developer’s apps into as many of these online stores as possible and provide the data on how they are performing.
Currently, it monitors 300 apps stores globally and Marcella says there is a huge market outside of Apple and Google.
Mobile networks such as Vodafone all have their own stores including MTN, which in Africa alone services 22 countries.
Device makers such as HTC, Samsung and LG also have app stores built into the smart TVs they make. Even online giant Amazon has its own app store.
Two types of customer
Marcella says it is aiming at two types of customer: The developer with one or two apps that wants greater distribution and the larger groups, often in regulated businesses, that have hundreds of apps and need a straightforward way to monitor them all.
For the small developer, logistically the platform makes sense, he says.
Once the app is submitted it is distributed to all compatible stores worldwide. They don’t have to re-apply or go to 50 stores and download sales information as the platform provides that.
There is no guarantee downloads will increase. He says that depends on the app, but some have seen sizeable upticks through wider distribution.
For the larger corporate customers organisation is the key. These firms have been building apps for years and in some cases now have hundreds.
One insurance customer has 250 with different applications in different countries for differing regulatory requirements, but the company wants to maintain brand consistency and fit in with the local compliance rules.
'Complete peace of mind'
The appScatter platform logs all of the apps and gives complete visibility in one place.
“A customer can see what they’ve got, what country they are in, what downloads they are getting. Complete peace of mind.”
Marcella says 51% of developers have only published one app, but 15% have more than 100.
AppScatter has not yet made the platform public but it has been soft-launched, with registrations so far numbering 10,000 and cherry-picked users selected for beta testing, usability testing and to test customer support functions.
Once it does go live, pricing will start from US$100 per month for one app and five users.
Two key metrics
Marcella says there are two key metrics to watch going forward.
First, the conversion of those 10,000 registrations into paying customers and second, the drop-out rate thereafter.
City analysts are suggesting 3% on the first metric and 15% on the second, but Marcella hopes appScatter will do better on both counts.
In addition, there will be add-ons such as an accounting function that reconciles revenue earned from the app stores.
Further down the line, appScatter will look at ways to monetise the huge amount of data it has collected already just from its early stage testing.
Results for the half year to June showed revenues of £875,000, which was generated from the beta testing.
On a pro-rata basis that equates to about £2.8mln annualised, though for 2018 a jump to at least £6mln is being pencilled in by the City.
Crucial to the business is that all revenues are recurring, says Marcella.
AppScatter raised £9mln when it floated last month at 65p and is valued at £42.5mln at 70p currently.
That may look punchy on the estimated sales numbers, but this is very early days and Marcella adds the business is complementary to everybody, not disruptive.
Once the numbers become clearer, the market will be able to get a better handle on the potential, though one thing seems for sure is that the number of apps available is only ever going to get larger.