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Locked Down Consumers Turns to Personal Productivity Apps

June 9, 2020

Greg Sigel

VP – Partnerships

The increased use of personal productivity tools since Coronavirus lockdown restrictions were introduced earlier this year mirror parallel growth in enterprise versions of the same software applications and online platforms. The key difference is that consumers are more likely to access those tools from their smartphones and tablets rather than desktop or laptop PCs and are far less likely to pay for their provision.

That doesn’t mean that they won’t fund subscriptions or pay for additional features in the future, though. In both cases, users are likely to continue accessing their favourite productivity tools to some degree once the COVID-19 pandemic subsides. Suppliers have proved both agile and adept at pushing out free versions of their premium productivity applications and services to specific vertical segments like healthcare and education. If those software companies get their pricing strategies right, some consumer buyers that have grown comfortable using them should prove happy to fund further usage once the initial discount offer is withdrawn.

All the while developers are busy rushing out new features and capabilities for their free versions which those same consumers may want to purchase on an ad hoc basis for a small fee. Direct carrier billing (DCB) represents one of the most seamless methods to fund purchases of digital content on smartphones. Apple users are already able to fund payments for additional iCloud data storage using DCB with select telcos and mobile network operators (MNOs), for example. So too are Skype users who want buy additional call credits for public switched telephone network (PSTN) calls, while the same is true for Amazon Prime users accessing the company’s online photo storage.

Personal use of popular business apps

The evidence certainly points to a much larger pool of prospective customers for personal productivity apps this year than there were in 2019. Research from time-tracking software company RescueTime conducted for the week beginning April 14th found that people in the US were already spending an average of 56 minutes a day (up 16%) more on their digital devices compared to a month earlier before lockdown restrictions in the country were implemented. And while there were slumps in the usage of apps categorised as software development (down 11.5% over the same period), design (down 3.8%) and business (down 3.1%) the winners were entertainment (up 2.3%) and communication (up 13.5%).

As of March 22nd, the daily active user count for Zoom’s cloud-hosted video and voice conferencing platform was up 378% compared to the same period in 2019, with monthly active users up 186% according to data supplied by Apptopia. Those statistics were also up about 340% and 160% respectively when compared to the last week of December 2019.

While a proportion of that additional usage will inevitably come from housebound remote workers and students using the software to engage with colleagues, customers, business partners and teachers, it is highly likely that a new generation of consumers keeping in touch with family and friends are pushing up the numbers in parallel. The recent concerns regarding potential security gaps while are being addressed by Zoom in the form of additional encryption has prompted consumers to beef-up security on their personal devices, with anti-virus applications such as Avast and Norton.

Non-paying Zoom users can still get up to 100 participants on a call, for example, though meetings are restricted to 40 minutes. The conferencing and collaboration software provider itself noted a significant increase in the number of free users, meeting minutes and new video use cases.

Zoom, Microsoft, Google and Slack grow user numbers

Microsoft reported a 70% surge in the number of daily active Skype users to 40m in April 2020 compared to March of the same year. Perhaps more significantly the company also announced a version of its Teams collaboration platform designed specifically for consumers set to debut in the summer of 2020. New features will allow people to plan trips, neighbourhood gatherings and book club meetings for example, as well as share photos and videos in group chats, make video calls and collaborate on shared to-do lists and co-ordinate tasks and schedules. The revamped platform looks like a long-term replacement for Skype, just as Teams is designed to supplant Skype for Business. And like Skype, it is likely to offer additional paid features on top of the free version at some point in the future.

Google reported 60% growth in the number of people using its Meets video conferencing product (the replacement for Hangouts) in the last few weeks of March, with daily usage peaking at 25 times the rate seen in January. Non-paying users can invite 25 people to join a video call (a temporary increase from ten), there are no time limits, and like Skype, Hangouts has the ability to make voice calls to a standard phone. Slack is another collaboration platform with free and paid versions, offering users the ability to send unlimited messages, organise threads, post links and share files with online storage limited to 5GB.

Dedicated consumer apps

Epic Games’ Houseparty is perhaps the most consumer-orientated of the lot, is aimed at children rather than adults and providing collaborative trivial and drawing game playing capabilities. The company reported that it had signed an additional 50m user and seen a 1000% plus increase in downloads since pandemic lockdown restrictions were implemented. While Houseparty is free, users can buy items such as additional card decks for a few dollars at a time.

April saw Facebook expand its video capabilities with the launch of Messenger Rooms, a tool for virtual hangouts that cater for up to 50 participants. The company also doubled the number of people that can participate in its video calls on WhatsApp from four to eight and introduced video calls on its Facebook Dating app. Chief executive Mark Zuckerberg reported COVID-19 induced usage levels usually only seen on New Year’s Eve, with Facebook, Instagram, Messenger and WhatsApp combined seeing an 11% year on year usage increase in the company’s most recent financial quarter ending March 31st 2020. And with the company’s advertising revenue taking a hit during the pandemic, Facebook may consider doubling down on initiatives such as Facebook Shops, which allows small “mom-and-pop” merchants to sell on the platform.

Online storage tools on the up

Video conferencing and collaboration are not the only productivity apps to have experienced a surge in usage during the pandemic – online storage tools have seen increased utilisation too. In its latest earnings statement published this month [May 2020], Dropbox reported seeing demand for its services increase significantly since mid-March. Daily trials of its plans grew 25%, with a 60% spike in the number of weekly active users of its new desktop app launched last September.

Free online tools which allow consumers to upload photos, videos, music and other files include Google Drive, Box, OneDrive, Amazon Drive, iCloud, Dropbox and BT Cloud. Most differentiate themselves by limiting the amount of storage on offer, Google Drive offers 15GB for free but charges around US$2 a month for 100GB. Box offers 10GB for nothing with individual file sizes limited to 250Mb, increased to 100GB and 2GB for US$5 a month for heavy users. Some users will find the basic quotas sufficient for their needs. However, others are likely to want additional storage to accommodate growing libraries of videos, films, photos, audio and other large multimedia data files.

Other segments such as Inuit’s DIY accounting app has gained more traction, enabling consumers to better plan their expenses and tax filings. Adobe’s suite of photo-editing and scanning apps are also becoming increasingly popular with broader consumer segments beyond the gig-economy workers.

Easy payment methods drive additional consumer revenue

If consumers do decide to foot the bill for the advanced features of communication and collaboration apps, or the additional data capacity provided by online storage tools, having a simple way to pay for them through DCB is likely to drive usage and propagate stickier, long term customer relationships through regular subscriptions. Allowing consumers to fund purchases through their mobile phones bills also reduces the risk of transaction abandonment which can occur through more complex card sign-ups.

With so many people now accessing personal productivity tools via the smartphone, mobile network operators (MNOs) are in a good position to orchestrate payments for premium versions and additional capabilities via DCB as and when the demand arises. With Zoom, Messenger, WhatsApp, Google Meet and Teams among the 50 most downloaded free mobile apps from Google Play in the US and Europe on June 3rd according to AppAnnie, there is perhaps no time like the present to build those telco relationships.

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