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How To Make Money In the Mobile Apps Business. Mobile Monday Lansing March 26 th 2012. Let’s Make Some Assumptions!. You will or currently have apps on an app store Mobile Apps will live on an app store They will be made publically available for all

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How to make money in the mobile apps business

How To Make Money In the Mobile Apps Business

Mobile Monday Lansing

March 26th 2012

Let s make some assumptions
Let’s Make Some Assumptions!

  • You will or currently have apps on an app store

  • Mobile Apps will live on an app store

  • They will be made publically available for all

  • We will touch on non-app store mobile app opportunities

Quick intro matt tubergen
Quick Intro – Matt Tubergen

  • 10 Years in Mobile

  • Made ringtones before ringtones were cool

  • Then mobile gaming took off w/THQ

  • Learned that DIY agency life is hard, for shizzle

  • Mobile freemium gaming investment

  • Back to MI, TechSmith lowers its acceptance criteria

Quick overview
Quick Overview

  • Market Recap

  • Top Business Models

  • Discovery - Growth Mechanisms

  • Best Practices for Any App

  • Questions/Discussion

How many apps
How Many Apps?

  • Over 1 million apps in apps stores worldwide

  • 59.6% of the apps are iOS

  • Android is 32.3%, Blackberry 4.4%

  • Est. 1,000 new apps added daily to iOS

  • Est. 1,400 new apps a day added on Android market

  • Top categories include (By volume of apps)

    • Entertainment - 16.78%

    • Games – 12.36%

    • Lifestyle – 8.02%

    • Utilities – 7.13%

Top business models
Top Business Models

  • 88% of top 250 grossing iOS apps are freemium

  • Android piracy on the rise, advertising it is!

Paid premium
Paid = Premium

Some Aspects of Premium Apps:

  • Higher retention rates of users

  • Perception of value is controlled by price and app store collateral

  • Revenue is realized only once

  • Paid apps are costly to promote

Premium what can you control
Premium – What Can You Control

  • Price Point

  • Icon, Keywords, Description, Screenshots

  • App Content

Premium – What Cant You Control

  • Placement/Features

  • # of installs

  • Rating

Premium best practices
Premium Best Practices

  • Lower the barrier to entry, make a free version to drive visibility

  • Launch with a high price point, never start with a sale unless you have built in brand awareness

  • Cross promotion in all existing applications

Sales and pricing
Sales and Pricing

  • Pricing changes can drive discovery but do so wisely

    • No more then once every 30 days

    • Reduce price by at lease 50%

    • Off-sale pricing is not static, consider the market

  • Sales are not a pricing strategy, it’s a marketing strategy

  • Have a reason for a sale

    • Tie sales to a change in content

Freemium free with strings
Freemium – Free with Strings

Aspects of Freemium

  • Barrier to entry is low

  • Lifetime value is revenue measurement

  • Potentially unlimited max revenue from user

  • Predictable ROI against paid marketing

Freemium what can you control
Freemium – What Can You Control

  • # of Installs

  • Icon, Keywords, Description, Screenshots

  • App Content

  • IAP pricing, ad placements, frequency

  • Retention

Freemium – What Cant You Control

  • Features/Placement

  • Ratings

Freemium understanding lifetime value
Freemium – Understanding Lifetime Value

  • Know your relative LTV and increase levers it to increase revenue

  • LTV is:

    • Revenue per user by X period multiplied by X periods

  • In other words

    • Retention * Monetization = Lifetime Value

Freemium best practices
Freemium Best Practices

  • Never limit how much you will let people pay

  • Use Metrics to verify your business

    • Consumption, sources and sinks

  • Incent sharing and activity with virtual goods/other value

Monetization streams
Monetization Streams

  • In App Purchases

    • Never allow for spending limits

    • Increase source/sinks

  • Advertising

    • Banner

    • Cross Promotion

    • Incentivized

  • Branded Experiences

  • Subscriptions

    Understand your “Whales”

Ad revenue characteristics
Ad Revenue Characteristics

  • Standard Banner

    • $1-$3 eCPM

  • Static Full Screen Interstitial

    • $2-$10

  • Video Preload

    • $4-$25 eCPM

      Watch your frequency!!!

Tricks to retention
Tricks to Retention

  • Incent return behavior/usage

  • Give reasons to re-enter

  • Focus heavily on the first minute of experience

  • Better to keep people then make them stay

  • Measure on day, week, month and other

Best practices for any app
Best Practices for Any App

  • Know your market, focus on fulfilling and speaking to your app store category

  • Time your launch per marketplace

    • Launch on Thursdays for iOS

Discovery best practices for any app
Discovery – Best Practices for Any App

  • Build a checklist before you start

  • Prepare and submit promotional material for each store

  • Prepare and submit promotional material for targeted app review sites or relative blogs

  • Build a promotional calendar

    • Events or holidays to showcase content or price

    • Update icon, imagery, test, keywords accordingly

Discovery best practices continued
Discovery – Best Practices Continued

  • Always cross promote

    • Leverage in app notifications

    • “Get More Apps” menu

  • Barter with other apps, companies

    • Use a mediation layer such as adwhirl

What we did not cover
What We Did Not Cover

  • Paid apps with IAP’s

  • Subscription Pricing

  • Payment Providers

Non app store
Non-App Store $$

  • Work for hire development

  • Mobile ads

  • Consulting/Strategy

  • Enterprise mobility is exploding