On The Internet Trends Report 2015 For Montreal Startups

Kleiner Perkins Caufield & Byers‘s Mary Meeker released her annual Internet Trends Report on SlideShare. As an avid yearly reader of this report, I want to highlight a few of the stats that are particularly pertinent to tech startups in Montreal.

On Internet & Mobile Phone Users:

Global Internet usage has definitively shifted to Asia. China alone accounted for 23% of Internet users. Combined with the rest of Asia, over half of the global Internet usage is in Asia. Montreal startups looking to expand outside of North America should consider China first even if the temptation to go to France due to reduced language barriers is very strong. There are plenty of resources available to you. The Canada-China Chamber of Commerce & Canada-China Business Council frequently host networking events and have plenty of resources online. If you’re hesitant to jump directly to China, many companies pursue Hong Kong as a stepping stone to the Chinese market. The Hong Kong-Canada Business Association can help you. If you’re looking for consulting experts in Chinese market entry, you can look at the Dragonbridge Corporation. If you’re looking at South-East Asia, the ASEAN is the organization grouping countries in the region. The Canada-ASEAN Business Council is another resource with many Canadian companies as members. Lastly, the Asia Pacific Foundation of Canada and the Canadian International Council frequently publish articles about Canadian relationships with Asia.

Smartphones are 40% of all mobile phone users although that ratio will depend strongly on the country.

China now counts 3 of the biggest public Internet companies by market capitalization. Any global search engine advertising campaign should consider including Baidu.

Internet user growth in Asia is heading towards India, which is up 33% vs. China up at 7%. For comparison, the USA is up 2% & Canada is 0% (See Appendix of slides). As for smartphone subscription growth, Chinese growth is being outpaced by India and Brazil.

Video traffic all up is increasing including on mobile. Time spent per adult user on mobile is growing while on Desktop/Laptop growth has flatlined.

On Advertising:

If you’re building ad-related or ad-tech startups, mobile ad spending is a $25+ Billion dollar opportunity in the USA. Facebook and Twitter ad growth is strong but slowing.

Startups should experiment with these new advertising channels: Pinterest Cinematic Pin, Vessel 5-Second Ad, Facebook Carousel Ad and Google Local Inventory Ad.

On Video:

Optimize small screen video ads for vertical viewing. Time spent in vertical viewing is growing faster than horizontal. Full-screen vertical video ads on Snapchat have a 9x higher completion rate.

On the Enterprise:

“While consumer Internet entrepreneurs often pursue personal passion… ‘Enterprise’ Internet entrepreneurs often pursue prior company pain points.” Examples: Slack, Square, Stripe, Domo, DocuSign, Intercom, Gainsight, Directly, Zenefits, Anaplan, Greenhouse, Checkr, GuideSpark, Envoy, etc.

On Messaging:

LINE, Viber, KakaoTalk and WeChat are extremely popular but practically unheard of in North America. LINE, WeChat, KakaoTalk are dominating Asia. The trend for messaging apps is to evolve into central communication hubs. Looking at this data, one can understand why Facebook decided to split the Messenger away from the main app and build a platform around it.

On Content:

User-generated content continues to dominate with Pinterest experiencing continued growth. Traditionally male dominated categories like “Car & Motorcycle” & “Men’s Fashion” pins are growing almost +100% Y/Y. This data should change your advertising messaging on Pinterest as the demographics evolve.

Video on Facebook is up 4x in 6 months. Live gaming/video streaming is growing +100% Y/Y. You should take a look at Twitch. Wattpad is growing like crazy too, and this is a new platform.

On Demographics:

Millenials and younger generations spend most of their time creating and consuming images and videos. Millenials are also now the largest generation in the workforce.

On Everything Else:

Consumer drone usage and cyber attacks are growing rapidly worldwide.

Freelancers are a growing proportion of workers, and their use of the Internet is exploding. Online platforms are allowing for both product and service commerce.

On China & India:

China is #1 Internet market in sheer mass, India is #1 in new users.

Research these companies & their strategies in Asia: WeChat, Mogujie, Melishuo, Xiaomi.

India is at an inflection point for Internet growth.

Download the PDF

Note: The accuracy of the data above is limited to the accuracy of Mary Meeker’s sources.

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