Connecting more customers in emerging markets with Windows Store

Many of us don’t think twice about making an online purchase with a credit card these days, but that isn’t true everywhere in the world. The World Bank estimates that 93 percent of people in emerging markets don’t have a credit card (Source: Measuring Financial Inclusion, The Global Findex Database), which means the majority of those people cannot purchase apps from most global app stores.

Today we’re proud to announce that Windows Store has become the first global smartphone platform to enable carrier billing for app purchases in China through China Mobile, India with Idea and Brazil via Claro. China Mobile alone is estimated to serve nearly 800 million customers, including millions of Windows Phone users. The largest carrier in the U.S, Verizon Wireless, has also added Windows Phone to the platforms it supports with carrier billing.

We set out to meet the growing demand for apps in emerging markets by working with carriers around the world to help their customers make purchases with their mobile phone account. We’ve now established connections with 81 carriers in 46 markets, with a combined subscriber base of 2.6 billion – that is 46 percent of all subscribers worldwide (Source: Ovum World Cellular Information Service) and more than any other major smartphone platform supports today. Already more than 60 percent of all paid Windows Phone transactions are made via carrier billing. The new billing connections announced today join several other high-growth markets in which Windows Store is the only global smartphone platform offering carrier billing, including; Argentina, Chile, Colombia, Mexico and Vietnam.

Behind our investment in the Store platform is a broader appreciation of the way the global smartphone market is shifting toward emerging markets. Canalys expects a 15 percent annual growth rate (CAGR) for all smartphone shipments in emerging markets from 2014 through 2017 – 2.2 times that of developed markets. This trend aligns nicely with Microsoft’s strategy of delivering quality experiences that span a wide range of price points and geographies. In fact, Canalys further predicts that Windows Phone shipments will increase by 77 percent (CAGR) in emerging markets and 41 percent for developed markets during the same time span (Source: Canalys estimates, November 2014).

No mobile platform provider is working harder to open up emerging smartphone markets to developers than Microsoft. We’ve invested in all three phases of app commerce to keep customers coming back to our Store: global reach, discoverability and payment.

Specifically we;

  1. Offer a full-service Store in 191 markets and in 50 languages, with support for a variety of monetization options including paid, freemium and ad-funded apps. In-app purchases – including those made through carrier billing – have grown to be 76 percent of all paid revenue (IAP+DTO), while the addition of ad mediation has helped increase advertising fill rate to 95 percent across all markets.
  2. Merchandise apps by market with hands-on curation and proprietary personalized algorithms to help ensure that customers discover the apps that matter to them in their local market. Nearly 20 percent of the titles we merchandise in the top 25 markets are developed within that country, while 66 percent of merchandised Windows Phone Store apps appear in the local language. In fact roughly 75 percent of Windows Phone app downloads are for a language other than English. Thanks in part to our merchandising efforts we estimate that Windows Phone customers download an average of 122 apps each.
  3. One of the biggest areas of differentiation for Microsoft is in the range of payment options we offer to pay for apps or make in-app purchases, which is why we’re so happy to be adding more carrier billing connections in key markets. These carrier billing options round out a range of payment choices that include credit cards, Alipay, Paypal and now bitcoin (U.S. only).

We know our approach is connecting people with the apps they want because we see it in the results. New carrier billing connections have the immediate impact of increasing total paid transactions by 8x per month in emerging markets and 3x in developed markets. All told we’ve seen an 87 percent increase in monthly sales year-over-year.

Windows Phone Store

The prospects for Windows Phone are strong in part because Microsoft understands where the next 5 billion smartphone customers will come from. We’re delivering rich experiences across a diverse global product portfolio that is backed by a Store that combines flexible monetization choices for developers with simple payment options for consumers. With universal Windows apps making it easier than ever to target a range of Windows devices, now is a great time to visit Windows Dev Center to learn more about building apps that take advantage of the growing Windows ecosystem.

Todd Brix
General Manager, Windows Store and Developer Marketing