Through the Magnifying Glass: Saudi Arabia - The Mobile Kingdom



Written by


The Kingdom of Saudi Arabia is a dark horse when it comes to the app market. For too long, oil has been recognised as its only form of economic power. In reality, the Kingdom of Saudi Arabia should be considered a global industrial conglomerate home to a diverse range of economic initiatives that is fast becoming one of the most entrepreneurial regions on the planet.

In April 2015, the Saudi government announced its Vision 2020 plan, which outlined the Kingdom’s strategy to focus on growth outside oil. With a vast collection of resources from the Saudi state to drive its vision, the Arabian Gulf’s largest economy has seen a dramatic shift to become a more modernised economic powerhouse with a distinctly digital edge.

The Kingdom is witnessing a surge in ecommerce and startups that are based on the power of mobile apps. It is supported by an enthusiastic group of New Millennials who have a spending power to be reckoned with, and boasts one of the highest rates of smartphone penetration in the world.

Plus, since this isn’t the first country to be hit by the digital wave, Saudi Arabia is extremely well placed to learn from international models as well as adjust and improve them to suit its own budding regional ecosystem. Clearly, the country is an exceptionally promising emerging market, and perhaps would be more suitably named: The Mobile Kingdom.

One of the highest smartphone penetration rates in the world

A key factor that is driving Saudi Arabia’s digital revolution is its astonishing rate of smartphone penetration.

Saudi Arabia has the third highest smartphone penetration rate in the world with around 21 million smartphone users (in 2019, 80.7% of the population used a smartphone), a number which is expected to increase to almost 24 million by 2022. With a total population of 30 million, those are some incredible statistics. The World Bank has also identified The Kingdom as one of the wealthiest countries in the world in terms of spending power, and this combination of factors has some very interesting results when it comes to the country’s app ecosphere.

Over the last ten years, online business in the Mobile Kingdom has rocketed, with some sources even reporting a rise of up to 1500%. IMRG revealed that, in 2017, 12 million people in the region went online to meet their shopping needs, and had an average expenditure of £470 per person. And it does not look like it is letting up with growth expected to reach 12.4% by the end of 2020.

Mobile Gaming in The Mobile Kingdom

As you can probably imagine, the mobile gaming industry in Saudi Arabia isn’t doing too badly either. In fact, it is leading the pack in terms of video gaming in the Middle East. Which is an especially impressive feat considering the region is home to the fastest growing online gaming population in the world. The Middle East boasts a whopping growth rate of 25% compared to Latin America (13.9%), Asia-Pacific (9.2%), North America (4%) and Western Europe (4.8%).

In the last 30 days alone according to our platform, 289.8 thousand gaming apps were downloaded on Apple App Store while 1.1 million were downloaded on the Play Store, demonstrating that Saudi Arabia is an Android first country. On the Play Store, the most gaming apps of 2020 were: Among Us, Yalla Ludo, Subway Surfers, Roblox and Ludo Star 2.

There are some 5.8 million gamers in The Mobile Kingdom – and COVID-19 is only adding more fuel to the fire in terms of boosting engagement on mobile games. Revenue generated from all video game sales in The Mobile Kingdom (across mobile, online and offline) was over $650 million, this includes sales of video games, skins (or outfits in the games), along with related brands, advertising, event tickets, licencing, content creation, prize money, and more.

However, this statistic only states how much was spent on video games as a whole. So, how many people are ready to spend on mobile games? You may find it surprising that 42% of all gaming revenue in 2017 went toward mobile games, with a predicted growth to 52% in 2022. In 2020, data from our platform shows that revenues from up front purchases and IAPs alone hit $196 million. This means the mobile gaming market is already one of the most important sections of the gaming industry, and it is only getting bigger.

Looking at the top 5 games on Android in Saudi Arabia during 2020 on our platform, we see that the top 5 apps (apart from PUBG, which has run into significant legal issues with the app stores covered here) have all reported significant growth, corroborating these claims.

So what’s causing this growth in games? It’s pretty simple; the MENA market is full of people who love mobile games. More importantly, however, is that they are willing and able to financially support the developers of the games they enjoy. The MENA market has what’s called the highest ARPPU in the world. This stands for ‘average revenue per paying user’ – basically, how much you can expect a user to spend on games. While China's coveted mobile market sees average revenue per paying user hit about $32, in Saudi Arabia ARPPU is an astonishing $270. It is hardly surprising, however, when we see on our platform that PUBG raked in a total revenue of $11.8 million in The Mobile Kingdom during 2020 alone.

This is no doubt a knock-on effect of the surplus cash that many Saudis have to ‘play’ with, and makes eye-watering reading for any app developer looking to make it big in the app market.

The forefront of global digitalisation

As you can see, Saudi Arabia is at the forefront of global digitalisation and its impacts have been pervasive in the country. The effect of digitalisation has changed the fundamental expectations and behaviours in the culture, market, industry and processes in Saudi Arabia’s digital sphere.

This ‘digital disruption’ has increased the number of top apps in The Mobile Kingdom and the influence of mobile apps has pervaded almost every industry. Many popular apps have proven particularly useful, transforming processes in industries and delivering beneficial outcomes in a variety of fields such as oil and gas, mobile gaming, healthcare, eCommerce and many more.

There has even been a small but significant emergence of top app developers in Saudi Arabia which have been helping to cater for the huge demand for mobile apps as the country becomes even more digitalised.

Shopping apps

Given the wealth of the country and its high smartphone penetration, it is not surprising that The Mobile Kingdom emerges as one of the world leaders when it comes to spending on mobile shopping apps. Reports suggest that online shopping grew a whopping 20-40% between 2014 and 2017, making it one of the most lucrative markets to invest in.

Surveys have identified New Millennials (those between the ages of 15 and 24) as the largest group of online participants, and that even if they do not yet have the spending power of older groups, they are extremely tech-savvy. This has created the perfect storm from which shopping via mobile apps has been able to thrive and play an increasingly important role in commercial activity in the region. According to insights from Airnow Data’s platform, 5 of the top 25 free apps on Saudi Arabia’s Play Store are online shopping apps, and these 5 apps had a combined number of downloads of 24 million in Q4 2020.

As demonstrated on the graph below charting the MAU’s throughout 2020, we can see a steady steady growth in usage of ecommerce apps. According to our data, in December 2020, the concurrent MAUs of these apps hit nearly 6.5 million. Clearly, we are not exaggerating when we say that the ecommerce market in the Mobile Kingdom is booming.

But it is not only the younger generation that have been responsible for this growing interest in e-commerce: the older generation are also taking advantage of the convenience of online shopping. Like in most countries, the largest market is middle-aged men, but they are certainly being challenged by both New Millennials and the number of female shoppers, which is growing exponentially as they continue to be welcomed into the Kingdom’s workforce.

As each of these age-groups vie to be the largest consumer bloc, it only makes excellent reading for marketers, as there is every indication that interest in online purchases is set to continue its upwards trend.

Healthcare services in Saudi Arabia

Perhaps one of the most interesting developments in the app market, and a testament to The Mobile Kingdom’s entrepreneurship and willingness to embrace the digital world, is the impact that apps have made on the healthcare service.

A report from TechGropse found that of the 84% of individuals who use technology to access healthcare through apps, 40% do so using healthcare applications on smartphones.

Two prominent examples of health apps are Sehhaty App and Mawid. Sehhaty App aims to enable users to access health information and medical e-services provided by different health organizations in the Kingdom, such as tracking prescribed medicine and other services related to the health of individuals and families and health awareness. Sehhaty currently ranks as the 25th most popular free app on the Google Play Store, with over 1.6 million downloads and an impressive 79 thousand DAUs.

Mawid, which was created by Saudi Arabia’s Ministry of Health, has over 5 million downloads across the Apple App Store and Google Play Store. The app provides all Saudi citizens, regardless of location, the means to have face-to-face consultations with their personal physicians or appropriate specialists remotely.

Although they have been massively popular since their inception, the usage of the apps have no doubt been exacerbated during the rise of COVID-19, as the apps have been in pole position to provide more efficient, contactless alternatives to traditional healthcare. Consequently, the apps saw massive spikes in downloads during March. Mawid recorded a 212.69% increase in app downloads from the 18th to the 28th of March on Android.

Wrapping up

Any app developer or marketer must be acutely aware of the potential that The Mobile Kingdom offers. As Saudi Arabia has adjusted its focus from oil to commerce, it has become a paradise for app marketers who want to invest in the future. Distributing your app to Saudi Arabia will ensure that your app is reaching a market that is highly mobile friendly, willing to spend and projected for further growth.