Wattpad AndroidTO 2011 - Android and Monetization

Android and Monetization Allen Lau wattpad.com/allenlau @allenlau Unlimited Stories

WHO IS THIS GUY?

WHO IS THIS GUY? • CEO and Co-founder, Wattpad – Community of readers and writers to discover and share stories – Wattpadders were spending 2 billion minutes on Wattpad in Q3 2011, most of them coming from mobile – Investors include Union Square Ventures, Golden Venture Partners, W Media Ventures • CEO and Co-founder, FeedM8 – Mobile advertising company, sold to Upstream Systems • CTO and Co-founder, Tira Wireless – VC backed mobile content publishing and deployment company

CURRENT MARKET

CURRENT MARKET• Number of apps = 500,000+• Number of downloads per month = 1 billion+• % of paid apps = 66%• Payout to developers = $3 billion• Number of apps = 500,000+• Number of downloads per month = 1 billion+• % of FREE apps = 66%• Payout to developers = 2% of iOS (2010) Google is downright “not happy” about the purchases of paid apps – Eric Chu, Group Manager Android Platform Manager, Jan 2011

WHY?• Openness encourages – Free apps – Copyright infringing content – Spam• Billing methods – Google Checkout vs iTunes – Billing reliability

IT’S GETTING BETTER!

IT’S GETTING BETTER!• Mobile advertising is becoming a viable option• In-app purchase – Very important when competing with LOTS of free apps• Operators Billing – AT&T, T-Mobile, Sprint – Vodafone UK, Vodafone Germany – NTT DoCoMo, KDDI, SoftBank, SKT• 3rd Party payment provider – Urban Airship, Zong, Boku, Payfone

PREREQUISITE

PREREQUISITE• Great product• Lots of users – It is a volume game – Don’t build apps for small niches (app for Mongolian food lover living in PEI won’t work) – Some exceptions (more on this later)• Build a business, not an app – Apps can be commoditized really quickly

ADVERTSING

ADVERTISING• eCPMs can be a few times HIGHER than iOS – Mostly CPC ads – CPM ads are few and far between• Advertising is a (high) volume game – eCPM is a step function of traffic• Using multiple ad networks and mediation are VERY important• Geography matters – Ad network is a local business• Other ad formats – Video and other intrusive ads generate higher CPMs – Don’t sacrifice your UX

PAID APP/IN-APP PURCHASE

PAID APP/IN-APP PURCHASE• Paid app – Hard to make it work when there are so many free apps and a suboptimal payment system• In-app (freemium) is the preferable model – At least you are on equal ground with all the free apps! – Treat “free” as your marketing expenses – As long as you have enough “mium” to convince users to pay up• Small niches, business apps, where price sensitivity is not an issue, is also a possibility

DO I NEED TO MAKE MONEY?

DO I NEED TO MAKE MONEY?• Remember - build a business, not an app• Can Android be your loss leader and make money elsewhere? – Especially true for network effect based business

ONE THING TO REMEMBER

ONE THING TO REMEMBER• Traction is king• Engagement matters• When you have a billion users, you have a million ways to make money• When you have no user, you have no way to make money

Thank Youp.s. we are hiring ;-) Allen Lau, CEO and co-founder Suite 801-B 4950 Yonge Street Toronto ON M2N 6K1 wattpad.com/allenlau @allenlau allen@wattpad.com

Wattpad AndroidTO 2011 - Android and Monetization

by Wattpad on Oct 26, 2011

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