How To Make Money In the Mobile Apps BusinessMobile Monday LansingMarch 26th 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 We will touch on non-app store mobile

app opportunities

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 Market Recap Top Business Models Discovery - Growth Mechanisms Best Practices for Any App Questions/Discussion

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%

Where is the Demand?

Top Business Models

88% of top 250 grossing iOS apps are freemium Android piracy on the rise, advertising it is!

Paid = PremiumSome 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 Price Point Icon, Keywords, Description, Screenshots App Content

Premium – What Cant You Control Placement/Features # of installs Rating

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 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 StringsAspects 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 # 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 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 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 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 Standard Banner

$1-$3 eCPM Static Full Screen Interstitial

$2-$10 Video Preload

$4-$25 eCPM

Watch your frequency!!!

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 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 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 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 Paid apps with IAP’s Subscription Pricing Payment Providers

Non-App Store $$ Work for hire development Mobile ads Consulting/Strategy Enterprise mobility is exploding

Questions?