Sygic To Release Navigation App For Free in India: Poor sales or Market mindset?
The world’s most downloaded offline Navigation App – Sygic has decided to release its navigation app for free in India “Sygic India: GPS Navigation” is now available for free in India on Google Play. The App was previously available for approximately $6!
The official reason behind the freebie?
App developers are struggling to make money in India because of low credit card penetration, According to Michael Stencl, CEO of maps provider Sygic, which has now dropped the $5.58 fee to download its GPS navigation app. As Indian Android owners remain reluctant to purchase apps, mapping providers are turning to features such as offline availability to compete with Google, which has grown in stature since launching turn-by-turn navigation and live traffic updates for Indian smartphone users last year. Source: Techcrunch
Is it really just poor sales that is hurting App developers or are the users expecting more than what the companies think they are looking for! Here’s what I think:
Regarding the “Low Credit Card Penetration Argument”
India as a market has a low credit card penetration and there are cultural reasons behind this. Traditional a person borrowing money on credit as viewed as a high-risk/not-so-reliable individual and people usually charged high rates of interest. This obviously lead to people relying on savings to buy their stuff. Naturally, credit card is still being viewed with the same mindset, although it is rapidly changing it is going to take some time.
Regarding “Offline Maps and Navigation in India”
MapMyIndia was perhaps one of the first navigation and mapping solutions provider in India. I hear that they have been doing quite well financially. But the Indian market is yet to fully embrace navigation applications as solution, we still like “the human interaction” to get directions. This mindset is changing as well.
“Over the past four years, Sygic has witnessed revenue growth of nearly 250%, and we feel that by continuing to invest development resources in key geographies like India, and maintaining a customer focused strategy, we will be able to extend our leadership position globally.”
MapMyIndia is really a good example in this regard, the company has been generating a lot of revenue from other sources than direct customers. Sygic happens to be one of their clients and I remember that many logistics companies in India use their maps for their planning. India is a really big market for navigation but more effort is required to understand the mentality of Indian users. Over 150 million apps were downloaded in Google Play Store India last year but only 0.5% of them were paid apps. The mindset in India is still quite conservative when it comes to adoption of apps for a fee. Besides one of the biggest reasons why navigation apps have not been entirely successful is due to the quality of the maps. Most of the maps available at the moment cannot navigate you to any nook and corner of the city in India as the address system is really complicated and complex. Although companies like MapMyIndia, Google and Sygic have done a really great job of delivering high quality and detailed maps for India, a lot more needs to be done before the “High Expectation Oriented Market” like India starts downloading navigation apps for a fee.
What you think about this development?
P.S: If you are a navigation user in India, this is a really good deal for you 🙂