Education Goes Digital
The Impact of Mobile Content & Commerce on the Education Market
A study of the impact of mobile content and commerce on the education market
MEF is the global community for mobile content and commerce. Among its publications is the Global Consumer Insight Series, which collects data from 13 sample markets, including Qatar, the UAE, and Saudi Arabia, and generates worldwide insights on attitudes, behaviours and trends in mobile content and commerce. Their third report, released in April 2014, investigates the impact of mobile content and commerce on the global education market. The study looks at how users of educational apps behave as compared to users of all apps.
Rimma Perelmuter, CEO at MEF said: “Mobile-first markets are clearly driving the uptake of educational apps. This nascent sector has been quick to adopt engagement and business models from other types of app with entertainment and gamification key motivators for consumer uptake”.
“A common theme across our Insight Series with reports on Mobile Money and Second Screening is the fact that early adopters are driving mobile commerce across the board. This theme continues, with educational app users who are more likely than the average mobile media user to purchase via their mobile.” Here are the key takeaways from the report:
POPULARITY AMONG MOBILE APP USERS Educational apps rank 9th among all app categories in terms of downloads, with 17% of mobile app users downloading this particular type—that’s a third of the number downloading mobile games. The number has dropped from 20% last year. The decline however is in line with a general decline in app consumption which has been attributed to a ‘choosier’ smartphone consumer and the rise of ‘ hero’ apps with a longer active life.
Users of mobile apps show the greatest enthusiasm for educational apps. The five countries that exceed the average rate of downloads in this sector are India, South Africa, US, Kenya and Nigeria. This is attributed to the mobile-first nature of these regions where access to online resources is scarce (the US is an exception, explained below). UAE and
Qatar show download rates very close to the average of 17%. KSA falls below it.
MOTIVATION FOR PURCHASE When asked about “motivations for purchase,” the reply “I had to for my school/college/university” mostly came from users in Nigeria, India, Kenya, and South Africa, and came least from users in UK, US, and China. A similar observation was made when studying the source of app downloads. The graph results showing who bought apps from an educational authority website and who had to use these same products as part of their education were almost identical. One possible explanation to this observation is that wide access to education reduces demand for educational apps, and vice versa. In other words, users are less likely to download products to help them with basic learning when they can tackle this at school.
THE CURIOUS CASE OF THE UNITED STATES Among the five countries with the highest download rates of educational apps, only the US is considered as a mature market. Mobile app users in the US download around twice as many educational apps as their developed market counterparts. One possible explanation could be related to the iphone’s much higher share of the local smartphone market compared to other geographies. The iphone’s manufacturer, Apple, is known to push for education hard in an effort to disrupt the publisher stranglehold on educational books.
MOBILE PURCHASES AMONG EDUCATIONAL APP USERS The research reflects that 65% of the total group studied makes some form of purchases from their phones. Among educational app users, this number increases to 72%, and up to 84% for those who have purchased from an education site.
Educational app users also tend to use a wider variety of purchase channels than the broader group. They are far more likely to buy from social media pages, operator stores and retailer web sites, for example. This could be because so many educational app users are located in
developing markets where the app store has less of a stranglehold on app purchases
THE ROLE OF EDUTAINMENT, BRANDS, AND ADVERTISING Many users don’t perceive educational apps solely as an academic product. In fact, when asked what motivated them to buy an education app from an educational site, the top answer was ‘entertainment’. 47% of education app users chose this factor compared to 35% of consumers buying any app from anywhere. This reflects blurry line between play and learning.
The importance of brands cannot be underestimated as an influencer of purchase across all types of apps. 11% of mobile app users said they downloaded apps because “it was from a brand I know and trust.” When it comes to educational app users, 29% say they bought the apps from an educational site, highlighting the significant influence of brands—in this case, educational sites—on purchase.
Interestingly, advertising is also a powerful motivator. Among all users of mobile apps, 8% said they bought an app because “advertising prompted me”. That figure increases three folds (24%) among educational app users who bought from an educational site and where prompted by advertising.
Whatever the motivation for downloading and purchasing, educational app users are generally more engaged with the business of mobile than most.
Gamification of apps is driving educational market growth, with entertainment as a key motivational triggerer.
While online supermarkets are still emerging in the MENA region, they have been around in developed markets for more than a decade. The idea started with mostly online-only stores that sell groceries in certain places. The failures that took place with several online grocers, such as Webvan, interrupted the growth and improvement of the service. Only innovative sellers with a solid business model and a limited area of service, such as Freshdirect, survived and grew. Today, bigger names, in both conventional and internet shopping, are more and more interested in the concept. Tesco, Walmart, and Amazon, among many others, have joined Freshdirect to sell groceries online in selected areas.
The concept is regaining interest for good reasons. Other than known benefits of buying off the internet, online grocery shopping can be very convenient for customers who don’t have the time to browse aisles. It can also be a great way for shoppers to avoid impulse purchases, lowering the overall shopping cost despite the extra money paid for delivery. For people who live in New York, for example, there is no easier way to get the exact needed amount of groceries than to log on to Freshdirect; it allows customers to choose the recipe they want and deliver the ingredients of that recepie to their address—in the right quantities.
Selling online could be good for businesses, too. Although processing an online order adds costs that don’t exist when selling conventionally, there is substantial money saved on stocking shelves, cashiers, carts, etc. More importantly, selling online facilitates gathering and analyzing information about buyers and their interests, leading to a deeper understanding of the market.
Today, the most popular online supermarkets cover a limited geographic area, usually urban cities. For example, Freshdirect operates only in New York; Amazon Fresh operates in Southern California, San Francisco Area, and Seattle Area; Tesco operates mainly in London; and the list goes on.
E-SUPERMARKETS IN THE REGION Baby-steps are being taken by supermarkets in MENA to shift online. Spinneys, the renowned supermarket chain, started an online shopping and delivery service in Larger Beirut area in Lebanon, with a plan to cover more areas. Strangely, the Spinneys smartphone app does not include this feature. Carrefour, the international supermarket chain, launched a similar service in Dubai. Geant also launched the first hypermarket store online in the Emirates.
There are several online-only supermarkets in the region. Among many we name Sallaty.jo in Amman; Biqala.com in Cairo; and trolley.ae, Supermart.ae, and many others in Dubai. But even though more and more e-supermarkets are emerging in the region, only a very small number of the big brick-andmortar supermarkets are shifting online, although with their already established customer base and expertise in inventory and logistics, they have a higher chance of success than nascent online stores. Success stories in the West, namely in the US and UK, had shown that unless there was a high level of innovation in an online service, customers would prefer to stick to conventional supermarkets that are more familiar and credible.
FACTORS FOR SUCCESSFUL E-SUPERMARKET BUSINESS MODELS Regional supermarkets have to consider several factors before integrating online shopping services. One is choosing the right coverage area, which is directly correlated with their ability to deliver groceries fast enough to maintain their freshness. That’s why Amazon, while delivering every other commodity across the world, provides online grocery shopping in 3 areas only, and Freshdirect.com, although has been in the market for over a decade, still operates in one city: New York.
The cities that benefit from successful online supermarkets (New York, Seattle, London, etc.) have a high population and great infrastructure. Reflecting that on MENA, a successful online supermarket must operate in cities with a dense population to ensure a sustainable customer-base, a reliable transportation system for timely deliveries of fresh products, robust and fast Internet connections, and high penetration levels of credit/debit cards—although the latter is not as crucial as the other factors as COD can still be a viable payment option. Also, the lifestyle of the population should be considered. A society with dual working parents, for instance, would see a great need for online supermarkets.
Taking these factors into consideration, we can safely claim that GCC cities possess the needed criteria for the successful implementation of online supermarket models; and we are most likely to see more brick-and-mortar supermarkets shift online in these cities. Dubai, which is now turning into a smart city, might be the one to take the lead.