How the Coronavirus outbreak rocked the entire mobile app industry

How the Coronavirus outbreak rocked the entire mobile app industry

Date: April 06, 2024

The coronavirus pandemic has shocked the entire mobile app industry with its outbreak. While ridesharing apps have been marred, grocery apps are at an all-time high

As organizations and communities around the world are impacted by COVID-19, we’re learning each day how we can apply technology to be productive, collaborative and maintain a sense of community. https://t.co/tv8t7Ag9fR — Satya Nadella (@satyanadella) March 10, 2020

Coronavirus- If by any chance you (still) haven’t heard this term, then you’re probably living under a rock at the bottom of the Mariana Trench. The pandemic has affected more than a million people and claimed more than 50,000 lives worldwide. This comes as no surprise that the global economy has suffered a massive dent. Standard Chartered estimates that the economy could take as gargantuan a blow as 42%. This is hairpulling scary! 

Well, if we shift the focus to specific industries, we’ll get varying figures but one thing is constant- Covid-19 has produced a resounding effect on every industry. Here we’ll narrow it down to the mobile application industry.

Mobile apps do have an impact on shaping our lives but what happens when suddenly you are not able to use many of them? This does produce a bad effect but then it leads to something else as well.

While governments across the world are enforcing lockdowns with immediate effect, this has somehow increased user engagement with smartphones. Terms like ‘quarantine’, ‘social distancing’ and ‘isolation’ have become worldwide phenomena as people across the globe are using social media to connect with each other for all the good reasons. 

There are two aspects to consider- downloads and usage. As people are spending more and more time in their homes, the usage of certain apps has increased which pertains to gaming, social media, fitness, editing, etc. whereas online shopping and food delivery are among the ones to get worst hit. In the following piece, you’ll get important insights into how the mobile app industry has been impacted by the Covid-19 pandemic. While the adverse impact was unavoidable, there have been some interesting revelations throughout. Let us go through those.

mobile app industry

How, despite losing business, are ridesharing apps bringing out more humane strategies?

Ridesharing companies like Uber and Lyft are feeling the impact as people are staying indoors and not moving out. The ridesharing apps who were earning huge profits have suddenly come reeling under the threat of this widespread epidemic as people have been strictly advised not to leave their homes. This has grossly ruptured the employment scenario of this industry. To mitigate this, the ridesharing apps, along with (DoorDash, Instacart and Postmates), have taken concrete steps to provide assistance policies to independent contractors. However, it gives provisional benefits to gig (contractual) workers who are down with coronavirus effects.This move has created unrest among those who are fit and work every day, and has resulted in disparate impact among wage workers.

An article written by the Wall Street Journal reported that the Uber and Lyft week-over-week spending was growing by over 3% and 4% on average. This was before the Covid-19 outbreak. Post the outbreak, things drastically changed. The WSJ reflected that consumer spending was reduced by 21% on Uber and 19% on Lyft. 
How have apps for communication been impacted by the coronavirus pandemic?

Until March 15th, 2020, global figures for non-organic installs (NOIs) have remained constant with no noteworthy change in a continuous timeline. Interestingly, this was quite similar to 2019, as deduced by AppsFlyer. However, for organic downloads, the tables have significantly turned. Till mid-Feb, you can observe a flatline but post that, the figures have risen by an impressive 15%.

Covid-19 outbreak

The sharpest rise has been observed among communication apps. The stats below reveal the data till March 15, where despite no change in the NOIs there has been an unbelievable rise in apps pertaining to the Communication category which stood at 150%. Now, this is up to March 15. In the past week, governments from all over the world have urged their respective countrymen to partake in nationwide lockdowns. 

service industry app

People who are feeling more and more isolated, the urge of communication has increased. This is one of the positive aspects that have come out of it. Now, with offices, institutions, public places and transport shut down, people have started using social media to connect with people. Celebs and influencers have started connecting with fans across the globe via social media to create awareness and imbibe a sense esprit de corps among all. There has been a barrage of awesome stuff that has created huge headlines. Platforms like Instagram have brought in more responses from celebs and users alike who took to their handles to address their fans and followers with messages relating to the virus and what one should do in isolation.

Some popular observations on Instagram during the self-quarantine phase

  • Celebrities like Gal Gadot, Mark Ruffalo, Kristen Wiig, Mark Ruffalo, Amy Adams, Will Ferrel, Sarah Silverman, Sia and a host of other celebrities came together to sing John Lennon’s classic song ‘Imagine.’
  • People in Germany, Italy, Spain and other countries have posted videos of them singing Money Heist’s OST Bella Ciao in solidarity for the victims of coronavirus in Italy. 
  • Popular comedian, writer and political commentator Trevor Noah (of Comedy Central’s The Daily Show) has started broadcasting The Daily Social Distancing Show which follows the same format of his pet show.

 Some other celebs like Chris Martin used Facebook to host a live gig for people calling it #TogetherAtHome.  

But there has been a significant backlash on social media platforms as they serve as a hotbed of circulating fake news and endless banter that has created unnecessary panic among people. Jeff Hancock, a professor at the Department of Communications at Stanford University and founding director of the Stanford Social Media Lab, has expressed his opinions to Time magazine, where he was quoted as saying,

 “They’re allowing society to sort of talk its way through what is an unprecedented kind of threat.” 

Sensationalizing a post makes it grab more eyeballs. Social media algorithms give precedence to content that has better engagement value. Such content disseminates faster. 

How have things changed for mobile gaming apps?

Since lockdown means long hours of spending in homes and restriction from going outside, people have started looking for alternatives to kill boredom and make good use of their time. Since the origins of the novel coronavirus originated in China, people entered the quarantine phase quite early. In fact, during the first week of February when the threat could only be felt by the Chinese, there was a colossal download of 22 million mobile gaming applications in the App Store from China. Even the average download rates in February went up by 40% in comparison to Feb 2019.

In the neighbouring country India, which is going through a nationwide lockdown until April 15th, has equally upped the game. Some gaming portals WinZO which hosts a variety of games including cricket, carrom, bubble shooter, etc. has seen a 30% rise in traffic. Game users took part and average time spent shot by ‘almost 3x, recording an all-time high’, as noted by co-founder Saumya Singh Rathore. It is also letting users use its platform for free, something the company is doing for the first time. 

Another popular platform, Mobile Premier League (MPL) is on a roll as its daily user count went up by 400% for the game, World Cricket Championship (WCC), from March 2 to March 18. 

All of this encouraged higher business opportunities as it caught the attention of investors. 

How has online shopping made sharp tweaks?

For online shopping brands like Amazon, the demand for healthcare and fitness products has increased. Yoga mats, fitness equipment, masks, gloves, etc. have been on high demand since the outbreak. But that’s just one aspect of it. The scenario that is woeful for the E-Commerce giant is that staff working in its warehouses have been tested positive for the Covid-19. This has caused CEO Jeff Bezos to order a shut down of warehouses outside of those products in high demand and healthcare. 

The letter Bezos wrote to Amazon employees shows his concern for the current situation and plans for mitigation. An excerpt reads, 

“a series of preventative health measures for employees and contractors at our sites around the world – everything from increasing the frequency and intensity of cleaning to adjusting our practices in fulfilment centres to ensure the recommended social distancing guidelines. We are meeting every day, working to identify additional ways to improve on these measures.”

Amazon warehouses are being shut due to coronavirus spread
Amazon warehouses are being shut due to coronavirus spread

As brick and mortar shops are closing down, people have flocked online to get their shopping needs fulfilled. But at the same time, these retail shops are the ones who are vendors to Amazon. The E-Commerce giant has temporarily scrapped shipments of non-essential items and is looking for better commercial practices to carry out business. 

As surveyed by Digital Commerce 360, 22% of the marketplace merchants are re-strategizing their plans to carry out business during the outbreak. The difference is that among the 304 retailers that were surveyed, each had a different plan of action. Some are sending the products to Amazon, some are conducting business from their own websites, apps or other means. The latter chose the other path as they don’t have to pay Amazon a commission fee on each sale and can enjoy a higher profit margin.

In the above image, it shows vendors and merchants have responded to the questions pertaining to their businesses’ impact due to coronavirus. 47% have admitted the financial impact will be there and business will go downhill. While a major portion is being sceptical and consider it’s too early to comment on anything. 

How are Restaurant and Food Delivery apps being affected?

The online food delivery market is another company that’s been hit. Since the demands have soared, the companies have increased their prices. This has also led to increased food delivery estimates which means the ordered food comes at a later time than usual. Plus, restaurants which are facing a staffing shortage due to the pandemic. Michael DiBenedetto, CEO of the popular online food delivery company, FoodBoss said, 

"There was some surge pricing last week, but that has dramatically shifted to fees that are more reasonable across the board. From March 12 to March 18, we saw food delivery fees were 16.3% higher compared to the first week of February,"

There are certain food tech apps like Uber Eats that have brought a change in their style of operations. As reported by Forbes, the company has removed charging delivery fees from local restaurants in the US and Canada. GrubHub has made a power-packed move where it doesn’t collect commission fees from restaurants and delivery partners. Although it’s temporary, the company believes that this will provide economic relief of $100 million. 

How are Grocery delivery apps witnessing record business growth?

When a global crisis strikes, some win and most lose. An unprecedented rise in sales has been witnessed by grocery companies. Here are some colossal figures that have been observed since the Covid-19 outbreak. Downloads rose by 216%, 160% and 124% for Instacart, Walmart Grocery and Shipt. The grocery departments have been hugely leveraged through their mobile apps which has made it hassle-free for consumers to shop during such harsh times.

What healthcare apps are trying their best to keep people healthy

Another grocery delivery app called Target saw 98% spike average daily downloads on 15th of March, i.e., on a Sunday. Where a month ago it was averaging 25,000+ downloads, on Sunday it rose by 53,100 more! 

The darker aspect of this is that people are engaging in mass hoarding of daily items. While people are partaking in a mass hoarding of grocery items, which is creating a huge imbalance among people, retail outlets are many a time running out of stock. While this is a result of panic being circulated that all retail shops and apps will be closed down; it is a hoax. Not just in the US, but in countries like India, UK, Australia and many other countries, such activities have been reported. But the truth is grocery delivery apps are functioning with full vigour to ensure that the locals get their amenities on time.

Those who are shopping directly from retail outlets disregard the concept of ‘social distancing’ where people are supposed to maintain a minimum distance to prevent the virus from spreading. Nevertheless, grocery delivery apps which were facing some challenges earlier are giving their best to streamline their process and make it easier for consumers to buy stuff in a systematic order.

What healthcare apps are trying their best to keep people healthy?

The global digital health setup is currently the most proactive sector in the world right now. While thousands of Covid-19 cases are coming up every day, it’s getting difficult for hospitals and medical practitioners to deal with the situation. That’s why healthcare mobile apps have jumped into the situation to make people aware of the harsh realities and advise them with sound fitness tips while they stay put in their homes.

Some apps have devised newer plans to make it easier for patients to face no additional nags during the course of treatment. DoClocker is an app that gives real-time reporting on waiting times for patients who would be recipients of medical assistance. This saves those patients from long hours of waiting in line and also the spread of the virus. 

The Patient Access app enables suffering beings to consult their doctors via online consultation through videos. It is currently used by 4000 people in England and doesn’t cost a single penny to the user. It also provides online training and support materials. 

Orbita, Inc developed a chatbot called the Orbita COVID-19 Virtual Assistant that provides easy access to queries and data related to the novel coronavirus. To assist healthcare organisations, Orbita is offering its technology at free of cost to mitigate the challenges imposed by the virus outbreak.

The fitness app industry has also brought out newer apps for people who want to carry on with their exercise regime and workout routines in their homes. There has also been an increase in downloads on educational and mental health apps as many people are finding it difficult to cope with loneliness during lockdown.

How is the app development industry facing a crisis?

The tenterhook situation extends to app development companies as well. As clients have stopped doing business, app development companies are also having difficulties in generating ROI. 

Gina Lupu-Florian, CEO of Wolfpack Digital, a Romanian software solutions agency, has assessed the current situation to MobileAppDaily. She said — 

"At Wolfpack Digital we are witnessing a shift in the priorities our clients give to mobile app development and to the features they choose to develop over the next weeks or months, to adapt to the new global situation of the pandemic. We can definitely feel the impact of the Coronavirus crisis on the mindset of everyone we work with, however, our opinion is that the effect will even out due to the need for everything digital.” 

She believes that as a unit, the agency uses its skills to save and adapt businesses by facilitating digitalization and the extension of their services. 

“We are happy to be able to help through our skills. Now is the time to invest in web and mobile apps because the Internet is where everyone’s clients are present even more than before!"

Many of the top B2B digital agencies with amazing clientele are losing out on key opportunities as their top customers head to the exit door, which is reducing the scope of their business to a great extent.

Sudeep Srivastava, co-founder and CEO of Appinventiv, feels times are tough and the Covid-19 threat has brought things to a standstill.

“Appinventiv feels the crumbling pressure that most of the app development companies around the world are facing. Clients from Fortune 500 brands to SMEs are incurring huge losses and could see no other option than to go into hiatus mode or terminate contracts," as told by Sudeep for MAD.

But there is also a catch to it. Since most companies are going digital and the use of the internet is at its pinnacle currently, the companies detaching from top global players are going for comparatively smaller yet reliable digital partners.

Sudeep states, “On a positive note, such companies are looking for greener pastures where they conduct business with low-cost niche digital innovation companies like ours as we have a proven track record of designing & delivering over 900+ successful products which has driven amazing growth for global businesses at a very economically viable cost.”

Ukraine and India are key players in the world of app development and the pandemic has brought changes in the digital ecosystem of both the nations. Now whether that has a positive or a negative impact in the long run, that is yet to be decided.

Three key players: WhatsApp, Spotify and Netflix

It has been over 2 weeks since the US has been observing countrywide lockdowns and be it work, concern or any other reason, people have profusely flocked to social media apps for communication. A massive surge was observed on Day 1 itself.  The most popular texting app WhatsApp saw a spike of 117-217%. In fact, on the 1st Sunday, there was an increase of 500% on daily traffic. 

negative impact in the long run

For online streaming apps like Netflix, the watching hours have shot up tremendously. In the graph below you can see the rise in traffic over the first weekend of lockdown. During the peak viewing hours, the traffic volumes increased from 54% to 75%. This added to overall rising traffic, with the fact that weekends are stressbuster times, along with lockdowns. 

entertainment apps

While the music industry has suffered a massive breakdown, with gigs and events being cancelled, entertainment apps such as Spotify have jumped to the rescue. The music media giant, which has observed an amazing growth in business over the years, has pledged to help artists suffering due to the outbreak. It has announced the Spotify  Covid-19 Music Relief project where they will donate $10 million to musicians. 
5 additional points you must know

Here are 5 fast facts that are also currently making headlines 

  • The supply chain industry has suffered one of the biggest depressions in the Corona pandemic fight.
  • Mobile World Congress (MWC), Google I/O, E3 and major other global tech events have been called off.
  • To facilitate remote interactions, the global outcry over 5G technology is being heavily emphasised.**
  • Experts have identified VR as a potential technology to be used in the wake of the pandemic.
  • As technology is being proven to be a valuable combatant in the current crisis, investment in smart city solutions gets green signals

**Wuhan is the Chinese city from where the novel coronavirus disease originated, and is one of the first 5G cities.

What we take away from here

Categorically speaking, almost every industry has taken a massive hit and all of them are finding ways to engage and reach out to more audiences in the current phase of distress. And what’s the source — mobile applications. Whether they are mobile apps for hotel industry, mobile apps for tourism industry or mobile apps for the fashion industry, all are putting their best foot forward to interact with the audience with digital means. Apps for the hospitality industry are making conscious efforts to make people aware of the current situation and advising them not to travel, rather plan for the future. Users are also being rewarded with coupons and vouchers for their future plans.

While many mobile apps face a slump and some are enjoying unexpected growth, everyone is hoping the pandemic will clear the air so that normal business routines ensue. The catch here is to stay safe and follow guidelines so that the malady dies. To ensure good health many mobile applications have taken the onus to help you maintain good health and sanity. Therefore, businesses are expected to carry on their operations with whatever resources possible so that their coffers don’t run dry and their collective fight against corona outbreak results in victory. 

What MAD believes is that the economy is going through a bearish phase of recession, but earnestly believes that once this fiasco steers clear, business will grow at a tremendous rate. There is a high possibility that the post-lockdown phase will provide an arena to amazing new business techniques and ideas. 

Arpit Dubey

By Arpit Dubey LinkedIn Icon

Arpit is a dreamer, wanderer, and a tech nerd who loves to jot down tech musings and updates. With a logician mind, he is always chasing sunrises and tech advancements while secretly preparing for the robot uprising.

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