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Top Mobile App Monetization Tactics You Ought to Know

Date post: 20-Jan-2015
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With the holiday season nearing, is your app monetization strategy geared up to get the most out of your users? Crafting an effective monetization strategy involves understanding and influencing your user's lifetime value (LTV). In this 1 hour webinar, you'll learn: What is LTV and how to apply it to your app business effectively -- metrics that you need to monitor and measure constantly. How to go beyond analytics & metrics -- apply advanced user segmentation to design clever strategies that can help you engage and monetize your users better. Some ideas to increase your app's monetization this holiday season. This session is led by Pratik Shah, Product Manager at InMobi.
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Pratik Shah | Product Manager Top app monetization tactics…
Transcript
Page 1: Top Mobile App Monetization Tactics You Ought to Know

Pratik Shah | Product Manager

Top app monetization tactics…

Page 2: Top Mobile App Monetization Tactics You Ought to Know

A bit about Myself..

Page 3: Top Mobile App Monetization Tactics You Ought to Know

What do these entities have in c o m m o n ?

Page 4: Top Mobile App Monetization Tactics You Ought to Know

Data. Insights. Actions.

“The deeper the understanding we have about our customers

and our products, the better we can connect with them.”

“We are an analytics company masquerading as a games

company”

Oakland A’s manager Billy Beane based his winning strategy on rigorous data

analysis to acquire top baseball players.

Citibank is exploring possible

uses for IBM’s Watson supercomputer in mining

customer data.

Page 5: Top Mobile App Monetization Tactics You Ought to Know

This is all great….. How the heck is this relevant for an app developer?

Page 6: Top Mobile App Monetization Tactics You Ought to Know

700K iOS & Android apps 60% app developers don’t profit 30% apps used only once

It’s a tough world out there.. Only the intelligent app businesses will win!

Page 7: Top Mobile App Monetization Tactics You Ought to Know

Agenda: Improve App monetization by focusing on your users

Best practices ‣  Monetization models ‣  Key metrics & ARM cycle Customer segmentation ‣  Why ‣  How Use cases ‣  Acquisition

‣  Retention ‣  Monetization

Page 8: Top Mobile App Monetization Tactics You Ought to Know

Best Practices

Page 9: Top Mobile App Monetization Tactics You Ought to Know

Monetization: Variety of monetization models

Advertiser pays Banner,

interstitial, cross promote, offer

walls..

Consumer pays

Paid downloads, in-app purchases, merchandizing, subscription..

Page 10: Top Mobile App Monetization Tactics You Ought to Know

Embrace the power of Freemium model

The best part? Not limited to gaming apps..

Page 11: Top Mobile App Monetization Tactics You Ought to Know

Metric driven? Don’t get lost in vanity metrics…

Did you catch the funny ones?

Page 12: Top Mobile App Monetization Tactics You Ought to Know

Retention Acquisition

Monetization

USERS

Keep it simple: Focus on value maximization during ‘ARM’ cycle

In order to focus on monetization, it is important to look beyond monetization..

Basics ‣  App value = Number of users * LTV of each user LTV of each user ‣  Lifetime value ‣  LTV = value * engagement Value levers ‣  Monetization ‣  Virality ‣  Loyalty ‣  UGC & Community ‣  Feedback ‣  Marketplace (Downloads, Ratings & Comments)

Page 13: Top Mobile App Monetization Tactics You Ought to Know

Track key metrics in the ‘ARM’ cycle

Audience ‣  Daily Active Users (DAU) &

Monthly Active Users (MAU) ‣  Demography Acquisition ‣  Cost per acquisition (CPA) ‣  ROI on campaigns (Value - CPA) Retention ‣  Stickyness (DAU/MAU) ‣  Retention rate Monetization ‣  Conversion rate ‣  ARPU & ARPPU

Page 14: Top Mobile App Monetization Tactics You Ought to Know

Customer segmentation

Page 15: Top Mobile App Monetization Tactics You Ought to Know

10%

13%

16%

16%

18%

24%

31% Loyal

Newly acquired

Dormant

Engaged

Socially active

Advanced

Whales

Lets borrow an industry best practice..

‣  Customer segmentation - a practice

of: ‣  Dividing a customer base into buckets that are

similar in specific ways (spending, engagement etc.)

‣  On which they can take targeted actions to extract the maximum marketing value.

‣  Traditionally, retail marketers have used segmentation as an important technique

‣  In order to maximize the value levers, app developers need to adopt the same sophisticated techniques.

Page 16: Top Mobile App Monetization Tactics You Ought to Know

Customer segmentation: How does it work?

Basics ‣  Use a rule engine to define user behavior & attributes to

define a segment

Dimensions ‣  Purchase history

‣  Time spent

‣  Session length

‣  Advancement

‣  Session frequency

‣  Country, Carrier, Device

‣  ….

Examples ‣  S1: IF purchase history > 25 percentile of my app

‣  S2: IF purchase history > $10

‣  S3: IF purchase history > $10 & Time spent < 5 minutes in last month

Need to track key metrics with the prism of each segment

Page 17: Top Mobile App Monetization Tactics You Ought to Know

Use cases

Page 18: Top Mobile App Monetization Tactics You Ought to Know

Lets put it to use in the ‘ARM’ cycle?

Retention Acquisition

Monetization

USERS

Page 19: Top Mobile App Monetization Tactics You Ought to Know

Acquisition: Leverage organic techniques

Basics ‣  Expensive to pay to acquire users unless you

have a well oiled positive ROI engine (LTV > CPA)

Measurement ‣  Cost per acquisition (CPA) ‣  ROI on campaigns (LTV/CPA) Techniques ‣  Internal cross promote (Keeping users within

your app portfolio) is the best but needs to be done properly..

‣  Viral is very cost effective, but also very difficult

‣  Performance networks (display, cross promote) are widely used to acquire further users

Page 20: Top Mobile App Monetization Tactics You Ought to Know

Identify pattern: Highly engaged users from USA are most likely to give you viral uplift Segment using rule engine: IF (time spent > 300 hours) & (country == USA) Incentivize virality Segment: Social influencers

Reduce your CPA by as much as 50%

Page 21: Top Mobile App Monetization Tactics You Ought to Know

Identify pattern: Advanced users in your top app don’t have other apps in your portfolio Segment using rule engine: IF (levels crossed > 25) & (! Using omegajump)

Smart cross promote Segment: ‘ripe’ users

Increase ROI by acquiring known users

Page 22: Top Mobile App Monetization Tactics You Ought to Know

Retention: Use a variety of techniques at different user stages

Basics ‣  Difficult.. but certainly most important Measurement ‣  Stickyness (DAU/MAU) ‣  Retention rate (% of returning users across

months) ‣  Cohort analysis ‣  Measure how many users return for 2nd time, 3rd

time and so on… Techniques ‣  Clean early experience ‣  Localize content ‣  Gamification: Rewards, challenges etc…

* Playnomics Q3 2012 report

Page 23: Top Mobile App Monetization Tactics You Ought to Know

Identify pattern: New users are likely to be delighted to see a tailored message Segment using rule engine: IF (App launches < 5) & (country == China) Localized ‘welcome’ Target segment: New Chinese users

Increase retention beyond day 1

Page 24: Top Mobile App Monetization Tactics You Ought to Know

Identify pattern: User engagement can be improved with a social taunt Segment using rule engine: IF (user time spent in last month < 50% of average time spent) Social ‘taunt’ Target segment: Waning users

Increase engagement by 30%

Page 25: Top Mobile App Monetization Tactics You Ought to Know

Monetization: Use tiered pricing

Basics

‣  Price goods along the curve based on capacity of each customer

Measurement ‣  Conversion rate (% paying) ‣  ARPU & ARPPU ‣  Customer profile split

‣  Whales (10% users, 60% revenue) ‣  Dolphins (30% users, 30% revenue) ‣  Minnows (60% users, 10% revenue)

Techniques ‣  Holiday & event specific ‣  Timely offers

Page 26: Top Mobile App Monetization Tactics You Ought to Know

Identify pattern: Hardcore users would pay a lot for certain features Segment using rule engine: IF (user time spent == high) & (app section == ‘tough’) Timely unlocks Target segment: Hardcore users

Display offers at right time

Page 27: Top Mobile App Monetization Tactics You Ought to Know

Identify pattern: High paying users in developed economies tend to purchase a lot during holidays Segment using rule engine: IF (user purchase history == high) & (date == 31st Oct) & (country == USA || UK) Holiday promotion Target segment: High paying US and UK users

Add cyclic bursts to your sales

Page 28: Top Mobile App Monetization Tactics You Ought to Know

How does a developer do all of this?

‣  Step 1: Deciding what data will

be collected and how it will be gathered

‣  Step 2: Collecting data from various sources

‣  Step 3: Developing methods of big data analysis for segmentation

‣  Step 4: Building in-house message server - scaled globally!

….Could this all be easier?

Page 29: Top Mobile App Monetization Tactics You Ought to Know

Thank you Pratik Shah Product Manager, InMobi

[email protected]


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