Reports > 2016 Chinese App Overseas Performance Report
2016 Chinese App Overseas Performance Report
2016 - 12 - 13


Cheetah Mobile Global Lab Senior Analyst


Yu Ran


Introduction


With the support of the Chinese government’s “Belt and Road Initiatives,” the opportunities created by global smartphone popularization, and the favorable market environment created by demographic dividends in Brazil, India and Southeast Asia, it is the perfect time for China’s mobile internet industry to expend overseas.


In 2016, Chinese internet companies exploring overseas markets have seen huge progress. Be it first-movers such as traditional giants Baidu, Alibaba and Tencent, or start-ups who have been gearing up to the overseas market since their founding, the Chinese internet industry’s overseas exploration is picking up speed.


How are Chinese companies doing in different regions? What kinds of Chinese apps are performing well overseas? With data obtained from Cheetah Mobile’s big data platform , covering over 50 countries and regions, Cheetah Lab will provide answers to these questions from multiple perspectives.



Brief Summary


The pace of Chinese app developers going global is accelerating. We can see from the map that Chinese apps are playing important roles in both developing countries such as Indonesia, India, Mexico, Argentina and Colombia, as well as developed markets like the U.S., Germany, Canada and Portugal.


Europe and the America are key markets for Chinese app developers, and their momentum is still strong. North America and Europe’s mobile internet markets are relatively mature with huge user populations and favorable market environments, making them the first choice for Chinese tool app and photography app developers.


In addition to Europe and America, Chinese app developers are also speeding up the expansion in emerging markets. With the advantage of the so-called demographic dividend, India and Indonesia have become the major battlegrounds for international players, and Chinese tool apps and social apps are growing rapidly in both countries. Meanwhile, with the advancement of technologies, Chinese news apps start to take root and are doing well in more than 50 countries. Finally, the Sino-Russian strategic trading partnership and the favorable policies Russia gives to Chinese companies have become drivers for the growth of the Chinese cross-border e-commerce apps in Russia.



I.Analysis on Overseas Chinese Apps by Category


1.What Types of Apps are Suitable for Overseas


There are 217 Chinese apps that made it into the Top 3,000 list in the overseas market, which can be categorized into 15 types.



There are 119 Chinese apps that made it into the Top 1,000 lists in the overseas market, 30 more than the number at the beginning of the year. There are also 5 more types of apps that made it into the Top 1000 than there were at the beginning of the year, namely News & Magazines, Shopping, Entertainment, Health & Fitness, Books and Dictionaries. In other words, both the number and the type of Chinese apps exploring the overseas market are increasing. Chinese app developers are accelerating their overseas expansion.



 


Of all the Chinese apps that have gone global, tool apps and photography apps are still the most.


Tool apps and photography apps are a natural fit for the overseas market. First of all, these two types of apps can easily break cultural barriers, and they don’t require a lot of interaction with either the app or other users. Secondly, these two types of apps don’t require a lot of local operation. That is, even if the company is headquartered somewhere else, the app can still penetrate the local market. Two good examples are Cheetah Mobile’s Clean Master and Pinguo Technology’s Camera 360, both of which have successfully expanded into overseas markets.


Cheetah Lab is also happy to see that the types of apps that are considered unfit to enter the overseas market are starting to make an impact. For example, short video social app musical.ly and live streaming app Live.me doing very well in North America. Shopping app AliExpress is becoming a big name in Europe and the U.S., while News Republic, a news app that offers multi-language content is gaining popularity in over 50 countries. These apps are all developed by Chinese companies, and are achieving success in different countries and regions.


Chinese companies are no longer limiting themselves to certain types of apps. They are actively trying out new types of products, and when these companies expand overseas, they are gradually changing from exporting tools to exporting content. The future trend will be exporting high-quality content-oriented products.


2. Detailed Analysis of Chinese Apps Overseas by Category



Note: Based on the rankings of the app’s overall penetration rate in different markets.

Active penetration rate = app total overseas active users /total overseas Android users

Overseas market = All regions outside of China (including Hong Kong and Taiwan)

Data period: 2016.10.17-2016.10.23

Tool Apps: the most Mature Apps to Go Overseas


As the most mature type of app to go overseas, the tool app category has the most number of apps in the global Top 3,000 list. With five apps in the Top 10 list of China’s overseas apps and performing well in different markets, Cheetah Mobile stands out as the most representative company among the list. The company’s flagship products, CM Clean Master and CM Security are far ahead of the others in terms of active penetration rate. CM Locker, which locks a user’s phone screen, easily beats other apps in terms of app opening numbers.


Shareit is a NFC-based cross-platform file transmission app developed by Lenovo. With Shareit, users can transfer files across mobile phones, tablets and computers without having an internet data connection. As a result, Shareit is very popular in places where mobile internet infrastructure is under developed, especially in India, where the total number of mobile phone users is huge but internet speeds are far behind most of the world.


Tool app developers are still well positioned to go global. Currently, smartphone shipments in China’s domestic market are no longer growing rapidly, but many other emerging countries are replicating China’s past growth. In these countries, smartphone shipments are still growing explosively and the market landscape is still changing fast. If Chinese companies can develop a product that perfectly meets users demands -- as Cheetah Mobile did with tools that remove junk files and protect device security, or as Shareit did by solving users’ file transmission problems -- they can still reap great returns from the overseas market.



Note: Based on the rankings of the app’s overall penetration rate in different markets.

Active penetration rate = app total overseas active users /total overseas Android users

Overseas market = All regions outside of China (including Hong Kong and Taiwan)

Data period: 2016.10.17-2016.10.23

Photography Apps: It’s All about Satisfying Users’ Desire to Look Beautiful


The photography app category has the second highest number of apps in the global Top 3,000 list. Products from seven companies made it into the Top 10 exported app list.


Of the top 10 photography apps that have gone overseas, BeautyCam and MakeupPlus have the most users in Indonesia, confirming the conclusion we reached in Cheetah Global Lab’s 2016 Global App Development Report that Indonesia is the world’s most selfie-loving country. Both BeautyCam and MakeupPlus are developed by Meitu.



 


[MakeUp Plus Active User Breakdown by Country]

[Indonesia, Vietnam, China, Thailand, Brazil, India, Philippines, Malaysia, Mexico, Korea, Other Countries]

Meitu is the leading player in China’s photography app market. Four of Meitu’s apps made it onto the Top 10 list of the China Q3 2016 App Rankings. With Meitu’s active penetration rate way ahead of competitors in the domestic market, it is only natural that the company has started to look at the overseas market.


The other thing worth noting is the rising popularity of YouCam Makeup and YouCam Perfect in Vietnam and India, both of which are developed by Taiwan-based CyberLink. With YouCam Makeup, girls can choose between different colors and styles to create the best digital makeup results. YouCam Perfect is similar to BeautyCam but with minor new features such as “artistic video shooting” and “fun scenes,” which are both well-liked by users in Southeast Asia and India.


There are no signs of photography app developers slowing down their overseas expansion. By satisfying users’ desire to always look beautiful, this type of app is grabbing a significant amount of global market share. Cheetah Global Lab estimates that in the future, photography apps will add new vertical features to attract more vertical users. For example, apart from photo shooting features and the beautifying filters, more and more photography apps have added all kinds of short video production features as well.


Note: Based on the rankings of the app’s overall penetration rate in different markets.

Active penetration rate = app total overseas active users /total overseas Android users

Overseas market = All regions outside of China (including Hong Kong and Taiwan)

Data period: 2016.10.17-2016.10.23

Social Apps: Moving Fast to Win Overseas


Social apps are generally considered the least suitable for penetrating the overseas markets. Despite that, China’s social apps are starting to gain grounds overseas, and it’s not just happening with vertical social apps like HD SMTH. Mainstream social apps are also gaining momentum.


Musical.ly is a mobile short-video sharing platform. Users can produce a fun video of up to 15 seconds, add music and share it with friends. The app was developed by Shanghai-based Wenxue Network and is performing well in the North America market.


China’s live streaming industry enjoyed a real boom this year, with more than 200 live streaming platforms competing with each other at its peak (For details, see our China Live Streaming Repot) . As a result, China is now the leader in the global live streaming industry.


In the Internet industry, you have to move fast. Since the Chinese live streaming segment is already a step ahead of the global market, it was only a matter of time before Chinese developers made forays into other regions. Live.me, BIGO LIVE, live.ly and Nonolive have already ventured overseas. Live.me, released by Cheetah Mobile, has surpassed Periscope to become the most popular live streaming app in America. BIGO LIVE, invested in by YY, together with Terabit Technology’s Nonolive, are sweeping the Southeast Asian markets such as Indonesia. Finally, live.ly and the aforementioned musical.ly, both developed by Shanghai-based Wenxue Network, are seeing positive results in America, Germany, Italy and other European markets.


The fact that Chinese social apps are aggressively expanding overseas proves that there is no longer a limitation to the types of apps that can attract a global audience. Those once apps that were once considered unfit for global expansion have started to perform well, and even more types of apps should be able to break down that barrier.



Note: Based on the rankings of the app’s overall penetration rate in different markets.

Active penetration rate = app total overseas active users /total overseas Android users

Overseas market = All regions outside of China (including Hong Kong and Taiwan)

Data period: 2016.10.17-2016.10.23

News Apps: Technologies Make It All Possible


News Republic is known as “the world’s first news media without journalists.” The company has partnered with over 2,500 news organizations from all over the world to offer users all kinds of news content, including news articles, images and videos. And because the content is available in multiple languages, News Republic is able to attract users from over 50 countries.


Alibaba’s UC Web is another classic example of a tool app that transformed itself into a content-driven platform for the overseas market. The active penetration rate of UC Browser in India has hit 32%, second only to Google’s browser. UC Web subsequently launched its news aggregation platform, UC News, which has enjoyed rapid growth, climbing to the top position of all news apps on Google Play based on downloads.


Central das Notícia and Topbuzz were launched in the Brazil news app market during the Rio Olympics. Central das Notícia was developed by NIP, and Topbuzz was developed by ByteDance, the rising star in China’s internet space that operates TouTiao. Cheetah Global Lab noticed that both Central das Notícia and Topbuzz are growing steadily in Brazil’s nascent news app market and have great potential to increase their market penetration rates. It remains to be seen whether the two companies can replicate the success they had in China. While they have the opportunity to disrupt the Brazil news app segment, there could be more powerful competitors catching up with behind. (For more details, please refer to Cheetah Global Lab’s Brazil Mobile Internet Report)


The Chinese news apps on the global stage all aggregate third-party content and provide personalized recommendations to users. Compared with traditional news apps that produce their own content, this type of app only needs to team up with local news production agencies. The companies don’t need to invest in content production talent, which increases operating efficiency. The fact that even news apps have successfully landed overseas shows us just how far Chinese companies can go with advantages in technologies.



 


Appendix: China’s Top 50 Overseas Performing Apps



II.Rankings of Overseas Chinese Company


 



 



III.Case Studies of the Developers


Cheetah Mobile


 



Cheetah Mobile was a pioneer for the Chinese internet industry going global, with star products such as CM Clean Master, CM Security and other utilities reaching the Top 10 in downloads in Google Play’s tool app category in different countries. According to stats from the company’s Q3 2016 financial report, Cheetah Mobile’s products boasted a combined 3.464 billion installations and 610 million monthly active users (MAUs) worldwide. 80.3% of Cheetah Mobile’s users are from overseas markets such as the U.S. and Europe.


In the early days, Cheetah Mobile hit the global market with different tool apps. Tool apps are usually simple, and can easily overcome cultural barriers. Once a tool app gets recommended by Google Play, it acquires a huge number of users instantly. However, over time, it becomes difficult to scale further so tool apps and the company need to find other avenues for growth.


This year, instead of putting all its eggs in the tool apps basket, Cheetah Mobile started to change strategies in the global market by pivoting from just making tool apps to developing content-driven products with the successful launched of Live.me and What’s Call in the North American and Middle Eastern markets. Live.me even dethroned Periscope to become the most popular social live streaming app for young people in North America. In the meantime, Cheetah Mobile acquired News Republic and invested heavily in content licensing by cooperating with over 2,500 news organizations in the world. So far, News Republic has entered more than 50 countries and regions.


The Cheetah Mobile experience mirrors the entire Chinese internet industry’s overseas push. Content-driven products will be the future trends for the Chinese internet exportation.


Alibaba


 



As one of the “Big Three” internet companies and the dominant e-commerce player in China, Alibaba has invested in all aspects of China’s internet space, and the company certainly hasn’t overlooked the overseas app market.


Alibaba’s AliExpress is a cross-border e-commerce platform that integrates online shopping, payment and logistics services. The app has become the No. 1 shopping platform in Russia and one of the Top 10 in Brazil and India based on the active penetration rate. Cross-border e-commerce will play an increasingly important role in international trade and AliExpress is poised for even stronger growth in the future.


On top of its self-developed AliExpress platform, on April 12, 2016, Alibaba acquired a controlling stake in Lazada, the biggest e-commerce platform in Southeast Asia, for USD 1 billion. Alibaba is selling all kinds of Chinese products to the world and Lazada is expected to help Alibaba connect Southeast Asian consumers with Chinese good.


Apart from e-commerce, Alibaba has other products for the global audience as well. UC Web, part of Alibaba’s Mobile Internet Group, also plays a key role in the company’s overseas development. UC Browser, known to be fast and data-economic, is the second biggest mobile browser in India and Indonesia following Chrome, based on active penetration rate statistics. UC News also climbed to the second position in the news app rankings, attracting a broad audience in India and Indonesia.


Sungy Mobile



Sungy Mobile was the first Chinese mobile internet company that went public in the U.S. As a pioneer in the overseas market, Sungy Mobile has the second most products in the list.


Sungy Mobile’s Go Launcher was once very popular in the overseas market, and other products that featured the “Go” brand, such as Go Keyboard and Go Security, were also hugely successful in Southeast Asia. However, after obtaining a huge amount of users with tool apps, Sungy Mobile failed to convert and monetize its user base. Without a diversified product portfolio, Sungy Mobile soon suffered major setbacks and had to delist from the U.S. stock market in November 2015.


Currently, Sungy Mobile is also pivoting to content-driven products. The company introduced Go Message and Go Music – two product categories with high usage frequency - to the South East Asia market. The two products have already attracted lots of users and gained initial success. Meanwhile, Sungy Mobile also successfully released a fast photography app called ZCamera in the U.S. and Brazil markets.


Sungy Mobile has acquired a huge user base with tool apps over the years. Sungy Mobile’s future now depends on if the company can figure out a way to leverage its user base to other content-driven products.


Lenovo



Lenovo’s mobile business centers on smartphones. App development is likely a way for the company to crack open and test a local market. Therefore, Lenovo’s current apps run overseas are still tools, and its key market is India. We have already introduced Lenovo’s app Shareit, which is popular in India. Other Lenovo tool apps, namely Cleanit and Lockit, have also achieved positive results in India.


Lenovo also has a music app Listenit. Although the software package of Listenit is only 2.0M, it is feature rich, with equalizing functionality and supporting lossless music play. Listenit is technically not a content-driven product. It is a pure music player that doesn’t support internet connection. The users are mostly located in India, the Philippines, Indonesia, Egypt and Iran, where the internet speed is slow and data fees are high.


Wenxue Network(musical.ly inc.)



 


Shanghai Wenxue Network is unique among the outbound Chinese internet companies in that it launched two popular apps directly in the North America market, namely musical.ly and live.ly.


Musical.ly was launched in July 2014. Prior to musical.ly, the team initially developed an education video product, only to discover in the process that professional video production still had high barriers and was still limited to a small group of people. During a trip to the U.S., the founders saw a group of American teenagers shooting photos and videos on a train and then sharing it with friends. The team then decided to develop a social app that combined short video and music features to tailor to the needs of the young flamboyant demographic. As a result, musical.ly was born and soon became popular in North America.


Following the success of musical.ly, Wenxue introduced another live streaming social app, live.ly, which also achieved positive results in North America and Germany.


The success of musical.ly and live.ly shows that as long as a company focuses on what users need, even the types of apps that are considered hard to operate overseas can flourish in foreign markets. It also proves that outbound Chinese internet companies don’t have to rely on tool apps, and that winning in overseas markets with content-driven products is completely viable.


Note:


1.Unless otherwise stated, the data used in this report is from Cheetah Mobile’s big data platform . On August 22, 2016, officially started to use new data source that has a broader number of sources and a much bigger data base. The new data source covers DAU, WAU, MAU, New Installation Rate and retention rate numbers and represents the mobile app market more accurately. Cheetah Global Lab will continue presenting users with more authoritative and more detailed reports on the mobile internet markets based on the new data.


2.The data is collected through the normal use of Cheetah Mobile’s products, adherent all relevant laws and regulation.


3.The data and rankings are only for the Android platform.


4.The data could be biased based on limitations of Cheetah Mobile’s user scale and demographics.


Copyright Clarify
Copyright ownership of data, conclusions, images, graphics and other components in this report belongs to Libra.Any media, websites, individuals or organizations share not be uploaded, posted, modified, distributed, reproduced, or used in other ways without permission.