mLabSouthern Africa9 February 2012Ben Zaaiman
mLab’s Purpose   The mLab    encourages and    supports mobile    innovators &    entrepreneurs to    grow their ideas to...
mLab’s Doors Have Been OpenSince August 2011                              3
4
Mobile Has Become the DominantICT Client                      The Economist – 8 Oct 2011                                  ...
6
(Smartphone Sales in the U.S.)                                 7
Nokia & Samsung Ship the Bulk of  Phones in the WorldGlobal Shipments Q4 2011                           Nokia             ...
Global Revenue is Split BetweenApple, Samsung, Nokia                                  9
Apple Takes 75% of Global Profit                               10
Why?       11
Multisided Markets DriveMonetisation Strategy                Users        Data       Miners   You      Advert-            ...
Facebook Didn’t Make BillionsCharging Users        U.S. Share of Time Spent on Platform Sites         AOL   Microsoft   Ya...
14
Somebody is Goingto Make BIG Moneyin This Industry...                      15
Products              Enterprise      Consumer               Solutions        AppsContracting                             ...
The Start-Up Pyramid           Scale         Optimize            Monetisation                               Strategy      ...
mLab Mobile App MonetisationFramework                               18
Number of Apps in iTunes Store(April 2011 - 30 Months after Start)350 000300 000250 000200 000                            ...
Games Dominate the Industry      % Games in All-Time Rankings of iTunes Store60%50%40%30%                                 ...
Sturgeon’s Law Also Applies to theiTunes Store                                     21
22
But You Should Find Out PrettyQuickly if You Have a Hit   Median Days From Launch to Hit Top 200 Lists                    ...
And Not Many are Long-Term Hits    Hits That Spend 30+ Days on Top 200 Lists                   iPhone       iPad    24%   ...
Price Range ExplanationNumber of Apps                                    Median                 25% Cheapest              ...
Price Ranges for successful iPhoneApps in Each Category              (Range Bars Exclude     25% Cheapest & 25% Most Expen...
Price Ranges for successful iPadApps in Each Category              (Range Bars Exclude     25% Cheapest & 25% Most Expensi...
Consolidate Free and Paid AppsThrough In-App Purchases Virtual goods / freemium /  subscriptions Freemium model, e.g. al...
Free Apps Are Well-RepresentedAmong Top-Grossing Lists      % of Free Apps in Top-Grossing Category                      i...
30
31
Ben ZaaimanJoin Us!   www.mlab.co.za           ben@mlab.co.za           +27 83 448 4336                    BZaaiman       ...
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Mobile Application Monetization Strategy

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Mobile Application Monetization Strategy

  1. 1. mLabSouthern Africa9 February 2012Ben Zaaiman
  2. 2. mLab’s Purpose The mLab encourages and supports mobile innovators & entrepreneurs to grow their ideas to full impact. The mLab advocates for and supports the use of the mobile channel in service delivery. 2
  3. 3. mLab’s Doors Have Been OpenSince August 2011 3
  4. 4. 4
  5. 5. Mobile Has Become the DominantICT Client The Economist – 8 Oct 2011 5
  6. 6. 6
  7. 7. (Smartphone Sales in the U.S.) 7
  8. 8. Nokia & Samsung Ship the Bulk of Phones in the WorldGlobal Shipments Q4 2011 Nokia 26% Other 42% Apple LG Samsung 6% 5% 21% Research & Markets – Jan 2012 8
  9. 9. Global Revenue is Split BetweenApple, Samsung, Nokia 9
  10. 10. Apple Takes 75% of Global Profit 10
  11. 11. Why? 11
  12. 12. Multisided Markets DriveMonetisation Strategy Users Data Miners You Advert- isers Deve- lopers 12
  13. 13. Facebook Didn’t Make BillionsCharging Users U.S. Share of Time Spent on Platform Sites AOL Microsoft Yahoo! Google Facebook50.0%45.0%40.0%35.0%30.0%25.0%20.0%15.0%10.0% 5.0% 0.0% Q1:08 Q2:08 Q3:06 Q4:06 Q1:07 Q2:07 Q3:07 Q4:07 Q3:08 Q4:08 Q1:09 Q2:09 Q3:09 Q4:09 Q1:10 Q2:10 Q3:10 Q4:10 Q1:11 Q2:11 Q3:11 13
  14. 14. 14
  15. 15. Somebody is Goingto Make BIG Moneyin This Industry... 15
  16. 16. Products Enterprise Consumer Solutions AppsContracting Proprietary Mobile Consumer Marketing Services Services 16
  17. 17. The Start-Up Pyramid Scale Optimize Monetisation Strategy Economics Promise Minimum Viable Product for “Must-Haves” Product / Market Fit 40% of Big Market Source: Marc Andreessen 17
  18. 18. mLab Mobile App MonetisationFramework 18
  19. 19. Number of Apps in iTunes Store(April 2011 - 30 Months after Start)350 000300 000250 000200 000 Free150 000 Paid100 000 50 000 0 iPhone iPad Ben Lorica: O’Reilly Research, 2011 19
  20. 20. Games Dominate the Industry % Games in All-Time Rankings of iTunes Store60%50%40%30% iPhone iPad20%10%0% Top 100 Top 1 000 Top 10 000 Ben Lorica: O’Reilly Research, 2011 20
  21. 21. Sturgeon’s Law Also Applies to theiTunes Store 21
  22. 22. 22
  23. 23. But You Should Find Out PrettyQuickly if You Have a Hit Median Days From Launch to Hit Top 200 Lists iPhone iPad 14 9 7 5 4 4 Top Paid Top Grossing Top Free Ben Lorica: O’Reilly Research, 2011 23
  24. 24. And Not Many are Long-Term Hits Hits That Spend 30+ Days on Top 200 Lists iPhone iPad 24% 24% 24% 21% 16% 14% Top Paid Top Grossing Top Free Ben Lorica: O’Reilly Research, 2011 24
  25. 25. Price Range ExplanationNumber of Apps Median 25% Cheapest Middle 50% 25% Most Expensive 2 3 12 price 25
  26. 26. Price Ranges for successful iPhoneApps in Each Category (Range Bars Exclude 25% Cheapest & 25% Most Expensive Apps)10 9 8 7 6 5 4 3 2 1 0 Ben Lorica: O’Reilly Research, 2011 26
  27. 27. Price Ranges for successful iPadApps in Each Category (Range Bars Exclude 25% Cheapest & 25% Most Expensive Apps)10 9 8 7 6 5 4 3 2 1 0 Ben Lorica: O’Reilly Research, 2011 27
  28. 28. Consolidate Free and Paid AppsThrough In-App Purchases Virtual goods / freemium / subscriptions Freemium model, e.g. allowing the user to unlock premium features from within the app Key benefits of this: ◦ Demo to pay engagement model; ◦ Develop a single app; ◦ Market a single app (climb up charts with single app). 28
  29. 29. Free Apps Are Well-RepresentedAmong Top-Grossing Lists % of Free Apps in Top-Grossing Category iPhone iPad 36% 25% 21% 15% 14% 16% 10% 8% Top 200 News Games Social Grossing Networking Ben Lorica: O’Reilly Research, 2011 29
  30. 30. 30
  31. 31. 31
  32. 32. Ben ZaaimanJoin Us! www.mlab.co.za ben@mlab.co.za +27 83 448 4336 BZaaiman 32
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