Monetize Your App - by hristo neychev
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Monetize Your App - by hristo neychev

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Monetize Your App - by hristo neychev Monetize Your App - by hristo neychev Presentation Transcript

  • MONETIZE YOUR APP by Hristo Neychevfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • So, you have created this amazing, useful app and now you want to make some money with it!facebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • What is your favorite cocktail?facebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • My favorite cocktail SEX ON THE BEACHfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • Now…let’s talk about SEXY PROFIT ON THE BEACHfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • SEXY PROFIT ON THE BEACH 30% analysis 20% forecasting 40% marketing 10% financefacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • Build it and they will come!facebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • Profit = Revenue – Costfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • PROFITABILITY ESTIMATION Total New Number Paying of Users Number Conversio Paying Users n Rate (to Users Churn paid) Revenue Revenue Buy the App Average Revenue In-App per User Purchases (ARPU) Subscripti on Fees Profit Infrastruc ture Cost Hosting Bandwidt h Storage Cost Developm Staffing Support Marketing ent Cost SEO PPC Marketing Budget Social Media PRfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • Total Number of Users New Paying Users Number Paying Conversion Users Rate (to paid) Churn Revenue Buy the App Average In-App Revenue per Purchases User (ARPU) Subscription Feesfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • Infrastructure Hosting Bandwidth Storage Cost Staffing Support Marketing Development Cost SEO PPC Marketing Budget Social Media PRfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • POTENTIAL REVENUE SOURCES • Pay-per-download • Sponsorships • In-app advertising • Promotions • In-app purchase • Lead generation • Affiliated web services • Analytics • Subscriptions • Affiliate salesfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • PAID APPREVENUE SOURCES
  • PAID APP  Prices from $0.99 up to $999.99  The Apple/Google store keeps 30%  Average price is going down  One time charge  Reduces adoptionfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • PAID APP  Prices from $0.99 up to $999.99  The Apple/Google store keeps 30%  Average price is going down  One time charge  Reduces adoptionfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • PAID APP  Prices from $0.99 up to $999.99  The Apple/Google store keeps 30%  Average price is going down  One time charge  Reduces adoptionfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • PAID APP  Prices from $0.99 up to $999.99  The Apple/Google store keeps 30%  Average price is going down 30%  One time charge  Reduces adoptionfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • THE 300 MOST POPULAR PAID GAMES PAID APP $2.50  Prices from $0.99 up to $999.99 $2.00  The Apple/Google store keeps 30%  Average price is going down $1.50  One time charge $1.00  Reduces adoption $0.50 $0.00 JUN 10 JAN 11 JUN 11facebook.com/HNeychev linkedin.com/in/HristoNeychev www.distimo.com twitter: @HristoNeychev
  • PAID APP  Prices from $0.99 up to $999.99 PEOPLE  The Apple/Google store keeps 30% EXPECT FREE  Average price is going down UPGRADES  One time charge  Reduces adoptionfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • PAID APP  Prices from $0.99 up to $999.99  The Apple/Google store keeps 30%  Average price is going down  One time charge  Reduces adoptionfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • FREEMIUMREVENUE SOURCES
  • FREE(mium) APP  Freemium vs. Free Trial  Freemium is a tricky game to play  Very low conversion rates  Beware of the marginal cost (MC)  Wider adoption = wider advertising  Set smart tripwiresfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • FREE(mium) APP  Freemium vs. Free Trial  Freemium is a tricky game to play  Very low conversion rates  Beware of the marginal cost (MC)  Wider adoption = wider advertising  Set smart tripwiresfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • FREE(mium) APP • Conversion rates are in the range 0.5% to 4%  Freemium vs. Free Trial • Look at Pandora, Dropbox,  Freemium is a tricky game to play Evernote, Skype, etc.  Very low conversion rates • Shoot for 1-2% conversion rate  Beware of the marginal cost (MC)  Wider adoption = wider advertising  Set smart tripwiresfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • EXAMPLE: MC = $1 FREE(mium) APP ARPU = $5 CR = 1%  Freemium vs. Free Trial CALCULATION:  Freemium is a tricky game to play Freemium users: 1,000,000  Very low conversion rates Monthly Revenue == $500,000  Beware of the marginal cost (MC) (1,000,000 * 1% * $5)  Wider adoption = wider advertising Monthly Cost: $1,000,000  Set smart tripwires SEXY PROFIT => UGLY LOSS facebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • FREE(mium) APP  Freemium vs. Free Trial  Freemium is a tricky game to play  Very low conversion rates  Beware of the marginal cost (MC)  Wider adoption = wider advertising  Set smart tripwiresfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • LIMITATIONS BASED ON: FREE(mium) APP • Features • Usage quota • Capacity • Number of seats  Freemium vs. Free Trial • Effort • Customer class • Support • Bandwidth features  Freemium is a tricky game to play  Very low conversion rates  Beware of the marginal cost (MC)  Wider adoption = wider advertising  Set smart tripwiresfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • IN-APPADVERTISINGREVENUE SOURCES
  • IN-APP ADVERTISING  Need an app used multiple times a day by the same user to get more impressions  Need a lot of downloads to make any money  Woks well with low MC freemium appsfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • IN-APPPURCHASESREVENUE SOURCES
  • IN-APP PURCHASES PAID  Several options  An example  The Apple/Google store keeps 30% In-App of each transition Purchases  Big revenue of potential FREE FREEMIUM  Multiple sessions lead to more purchasesfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • IN-APP PURCHASES  Several options  An example  The Apple/Google store keeps 30% of each transition  Big revenue of potential  Multiple sessions lead to more purchasesfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • IN-APP PURCHASES  Several options  An example  The Apple/Google store keeps 30% 30% of each transition  Big revenue of potential  Multiple sessions lead to more purchases AGAIN facebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • REVENUE POTENTIAL IN-APP PURCHASES 9 Advertising 8 Revenue 23%  Several options 7 IAP Revenue  An example 6  The Apple/Google store keeps 30% 5 18% of each transition 4  Big revenue of potential 3 77%  Multiple sessions lead to more 2 82% purchases 1 0 2011 2012Efacebook.com/HNeychev linkedin.com/in/HristoNeychev http://www.flurry.com twitter: @HristoNeychev
  • FIRST IN-APP IN-APP PURCHASES[CATEG PURCHASE ORY NAME] ,0  Several options [CATEG[VALUE] ORY NAME]  An example [VALUE] [CATEG  The Apple/Google store keeps 30% ORY of each transition NAME]  Big revenue of potential [VALUE]  Multiple sessions lead to more purchasesfacebook.com/HNeychev linkedin.com/in/HristoNeychev http://www.emarketer.com twitter: @HristoNeychev
  • AFFILIATEDWEB-APPREVENUE SOURCES
  • AFFILIATED WEB-APP  Good for content based apps  Make money on the service/content not on the app  Reach new customer audience  Reach new search behaviorfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • AFFILIATED WEB-APP  Good for content based apps  Make money on the service/content not on the app  Reach new customer audience  Reach new search behaviorfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • 5 Common Mobile AFFILIATED WEB-APP Search Behaviors 1. Fewer keywords  Good for content based apps 2. Location is key (GPS, Google places)  Make money on the service/content not on the app 3. Mobile experience  Reach new customer audience 4. Time (more frequent on evenings and weekends; the  Reach new search behavior opposite of desktop search behavior) 5. Apps vs. Browser searches 27% vs. 73% but growingfacebook.com/HNeychev linkedin.com/in/HristoNeychev http://www.spydertrap.com twitter: @HristoNeychev
  • SUBSCRIPTIONSREVENUE SOURCES
  • SUBSCRIPTIONS  Good for content based apps (newspapers…  …magazines, and comics)  Not limited to those  Low conversion rates (1-5%)  Relatively reliable revenuefacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • SUBSCRIPTIONS  Good for content based apps (newspapers…  …magazines, and comics)  Not limited to those  Low conversion rates (1-5%)  Relatively reliable revenuefacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • SUBSCRIPTION BASED GAMES SUBSCRIPTIONS  Good for content based apps (newspapers…  …magazines, and comics)  Not limited to those  Low conversion rates (1-5%)  Relatively reliable revenuefacebook.com/HNeychev linkedin.com/in/HristoNeychev http://www.insidemobileapps.com twitter: @HristoNeychev
  • SUBSCRIPTIONS  Good for content based apps (newspapers… SUBSCRIPTION  …magazines, and comics) CONVERSION  Not limited to those RATE  Low conversion rates 1-5%  Relatively reliable revenuefacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • IDEAS: SUBSCRIPTIONS • Annual subscription • Monthly subscription • Automated recurring billing  Good for content based apps (newspapers… • Subscribe for a service/feature • Subscribe for support plan  …magazines, and comics) • Good/Better/Best account  Not limited to those options  Low conversion rates (1-5%)  Relatively reliable revenuefacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • CHOSE THE RIGHT MONETIZING STRATEGY • Simple Games = Free/Freemium + In-App Purchases • Complex Games = Paid/Freemium + In-App Purchases • Niche Apps = Paid with a Higher Price + Good Service • News Apps = Free + Advertising • Content Apps = Free + Subscriptionfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • NEXT STEPS 1. Choose your monetizing strategy 2. Build your Revenue and Cost forecasting models • (based on assumptions) 3. Challenge your assumptions • (research articles, studies, similar apps, marked data) 4. Finalize your forecast (World Domination Plan ) 5. Go Live 6. Use real live data to constantly improve your strategyfacebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • And last, but not the least… …have FUN on the beach!facebook.com/HNeychev linkedin.com/in/HristoNeychev twitter: @HristoNeychev
  • Thank you! facebook.com/HNeychevlinkedin.com/in/HristoNeychev twitter: @HristoNeychev