This article is about 2000 words. You’ll need approximately 3 minutes to finish it, after which, you’ll understand:

  1. The advertising strategies for China’s cleansing apps’ overseas penetration and elements determining their monetization;
  2. The strengths and weaknesses of China’s cleansing apps in competitions for overseas market shares.
  3. In this turbulent environment, how cleansing apps can reverse its current losing trend.

 

New Achievements among the Ordinaries – Overseas Downloads of Cleansing Apps Amazed the Industry

 

With differences in policies, cultures, consumer habits, as well as unfriendly business regulations and language barriers, on the rugged road for Chinese companies’ overseas expansion, a unique trend has stood out – without much hype, cleansing apps have been ranking top in terms of overseas sales and achieved amazing revenues.

Early cleansing apps had rather simple functions like quick erasing, cleansing and clearing of browsing data, and historical records of texts and phone calls. In overseas markets, even though there had been demands for such apps, few had really worked in this area. Most companies thought cleansing apps’ functions and demands were very limited. With low projected ROI and not so promising business prospect, promoting cleansing apps would be very strenuous. At that time, AVG, CCleaner and Power Clean all had important positions on the market and they shared the following similarities:

✦  Clean and simple UI, clear and easy-to-use functions

✦  Low memory usage, powerful cleansing functions.

✦Android-based versions evolved from PC versions, all are paid software

They had once dominated various ranking lists but failed at unbelievably fast speeds. Quite out of people’s expectation, it is Cheetah Mobile who had wanted to avoid direct competitions with 360 and Tencent in domestic markets and chosen the overseas markets that had achieved success in this area. They filled the void of cleansing apps in overseas markets and gained big chunks of overseas market shares.

As early successful explorers of overseas markets, Cheetah Clean Master now has a market value of USD 5 billion. It still ranks top among cleansing apps after being tested by fierce competitions. The latter player APUS has an assessed market value of USD 1.5 billion and was regarded by the New York Times as a representative unicorn in Asia. The advertising strategies of both companies in overseas market penetration mainly focus on two areas:

1.Using Facebook as the main marketing channel and actively building in-depth strategic cooperation with major overseas media platforms.

2.Focusing on 2C marketing, being devoted to product operation and distribution.

According to the analysis of SocialPeta (as shown above), the main ad form of Cheetah Mobile is images, accounting for 78.8% of its total ads. About 86.08% of its ads have been placed on Facebook.

According to the analysis of SocialPeta (as shown above), the main ad form of Cheetah Mobile is images, accounting for 78.8% of its total ads. About 86.08% of its ads have been placed on Facebook.

The material analytics of SocialPeta shows that ads of Cheetah Mobile mainly feature creative and cute images that are highly relevant to its functions. Many ads have achieved conversions of over 10,000 users.

However, the two companies wouldn’t possibly succeed if without a proper penetration time, favorable market environment and great overseas partners:

 

✓  Unmet overseas demands. Cleansing apps are product-driven instead of operation-driven. User requirements in different countries are almost the same. With good functions and effective marketing, smooth market penetration is possible.

 

✓  Inherent reasons: Clean and simple UI design, good functions, foolproof operations.

 

✓  Offering free apps. Free apps focusing on a particular vertical with “just fine” functions, can influence users’ result-oriented decision-making.

 

An Exemplary Model of Traffic Monetization – 1+1>2

According to statistics from iResearch, in 2016, the percentage of users in preference to the “space cleansing” function reached a high level of 85.8%. The user base of such apps is still expanding at a considerable speed.

Companies can tap into the value of their own cleansing apps and develop strategies based on local situations. The following ways to traffic monetization can be considered as top priories:

◆ Paid themes (On the Facebook fan page, it’s the hottest topic among users. There are different personalized themes for different phone manufacturers).

◆Forming a matrix of products and launching the company’s own advertising platform. Taking Cheetah Mobile as an example, after Cheetah Clean Master’s great success in market penetration, the company introduced tools like battery doctor, memory master, and CM Launcher. These apps had mutually promoted each other in user base expansion.

◆ App bundling + Manufacturer Pre-installation. This method works like this: when users download or update the app, other apps will be bundled with it. Advantages: it can greatly improve downloads and numbers of daily active users; disadvantages: it may irritate users and backfire to win a bad reputation.

◆ Screen activating ads – banner placement + pop-up ads. This method was once extremely popular but was gradually abandoned, for it can easily irritate users.

◆ Building communities. The biggest weakness of cleansing apps is that they only act as utility tools for users. So user loyalty is rather low and other apps can easily take the place of yours. Building a community can not only better engage users but also improve their loyalty to your app.

 

A Turbulent Way to Growth, Full of Detours to Maintain Success

Cheetah Mobile Clean Master was removed from Google Play in August 2014 and June 2015, and was banned from all advertising on Facebook in February 2017. The two experiences with Google Play have had great impact on Cheetah Mobile and alerted companies with similar products. Nowadays, cleansing apps have made great progress in ad display and induced app downloads and their focus has shifted to in-feed ads.

In addition to external pressures, with the development of other new apps, some “frictions” arose while different apps scrambled for market shares. There have been several major confrontations between apps, including that between Tencent and 360, Cheetah Mobile and 360, Cheetah Mobile and APUS. The way to maintain success is full of detours.

Since 2015, cleansing apps have followed one another to transform and exit the markets: GOMO, the parent company of Go Launcher, which had once gained over 100 million users, left the market after two years’ public listing. Evan Cheetah Mobile is also actively transitioning to content business, by purchasing the News Republic and introducing the content-based live-streaming tool Live.me. It is also building its AI business focusing on voice OS and image recognition. By all these, Cheetah Mobile has been trying to remove its tags of “cleansing apps” and “utility apps”.

This crisis seemed to have happened a lot faster than these companies’ success. It has actually happened because of their inherent characteristics.

 

➤ Cleansing apps can be easily replaced and face great competition pressure. This is the common weakness shared by all utility apps. The new features they introduce may be easily copied by other similar apps, making the competition fiercer.

➤  Monotonous business model. The revenues of all these apps come from ads and they are highly dependent on advertising channels and advertisers.

➤What the mobile Internet is creating is no long a traffic economy but an attention economy. The value of an app is more reflected in its user loyalty instead of its traffic.

 

There’s Still the Possibility of “Leapfrog” Growth

The current times provides a precious opportunity, especially to those established major market players. They can take full advantage of their greatest strength – their large user bases, to finish their business transition.

This is what Cheetah Mobile is currently doing. According to its 2017Q2 financials, Cheetah Mobile has harvested great results on Live.me. Based on the projection, by the end of Q3, the website will have doubled its DAU (daily active users), helping Cheetah Mobile make great progress towards content business.

Till now, downloads of Cheetah apps in global app stores still rank among the top few. For example, it’s ranked the fourth in Android systems and the fifth in iOS.

The Public Data of App Annie by June 2017

If the business focus is still on utility apps, the breakthroughs of cleansing apps can be made in the following aspect:

◈  Stylized design, personalized UI copy, which is unique but users can easily relate to.

◈ Thoughtful interaction to improve user loyalty and win a larger user base

◈  Cloud-based apps. The cloud tech can help apps meet users’ fundamental needs and save memories of cell phones. It can also guarantee the security of user information and data. If companies want to realize leapfrog growth and create another peak period for their apps, they can upgrade from a single utility app to a management platform. Or they can develop various derivative products to build a strong ecosystem and a world-class mobile platform with sustainable growth and profitability. Xiaomi is already trying this model without much hype and has formed a system at some scale. Cleansing apps have greater potential to attract large traffic than Xiaomi, so if the transition can be realized, it’s possible that a tipping point may be reached some day.