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State of the App Economy: 2018 and Beyond by Eric Seufert

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Eric Seufert's 2018 State of the App Economy presentation from Casual Connect Disneyland. The presentation discusses the current state of the App Economy from a marketing standpoint and outlines 3 mobile marketing tactics that practitioners should be aware of in 2018.

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State of the App Economy: 2018 and Beyond by Eric Seufert

  1. 1. State of the App Economy: Trends and Tactics for 2018 and Beyond Eric Benjamin Seufert Casual Connect Disneyland, January ‘18 N3TWORK
  2. 2. Who I am N3TWORK Mobile Dev Memo Freemium Economics
  3. 3. Previously
  4. 4. Presentation Structure
  5. 5. Presentation Structure 1) Current State of the App Economy;
  6. 6. Presentation Structure 1) Current State of the App Economy; 2) 3 Challenges & Opportunities, 2018;
  7. 7. Presentation Structure 1) Current State of the App Economy; 2) 3 Challenges & Opportunities, 2018;
  8. 8. Current State of the App Economy
  9. 9. • The Duopoly (Facebook and Google) owns considerable mobile audience and that audience is growing; Current State of the App Economy
  10. 10. Source: Nielsen Current State of the App Economy Source: Nielsen Source: comScore
  11. 11. - 8 / 10 of the most used apps (in terms of unique audience) owned by Facebook & Google; - “Legacy” apps like Facebook, YouTube, Gmail still growing at >10% YoY. Source: Nielsen Current State of the App Economy
  12. 12. - Many of these apps are ad channels and / or third-party content distribution channels. * * * * * * * Source: Nielsen Current State of the App Economy
  13. 13. • The Duopoly (Facebook and Google) owns considerable mobile audience and that audience is growing; • The Duopoly has productized its massive quantity of user data into industry-leading, proprietary ad bidding and targeting tools; Current State of the App Economy
  14. 14. Current State of the App Economy Source: Marketing Dive Source: AdWeek
  15. 15. • As a result of its proprietary data and the tools that utilize it, the Duopoly has captured a massive portion of the mobile advertising market; Current State of the App Economy
  16. 16. Current State of the App Economy Source: IAB Source: eMarketer Source: eMarketer / WSJ
  17. 17. • Engagement is being concentrated in a smaller number of apps; Current State of the App Economy
  18. 18. Current State of the App Economy Source: comScore
  19. 19. Source: SensorTower / Unity *Applies specifically to mobile gaming Current State of the App Economy
  20. 20. • Engagement is being concentrated in a smaller number of apps; • The biggest apps are becoming 3rd party content distribution platforms & intermediating the app discovery process; Current State of the App Economy see: The coming war between Apple and Facebook, http://mobiledevmemo.com/coming-war-apple-facebook/
  21. 21. Current State of the App Economy Source: Facebook
  22. 22. Current State of the App Economy Source: Apple
  23. 23. Current State of the App Economy Source: Variety / Facebook
  24. 24. Old Discovery Paradigm App Store / Google Play App Content Consumption “App Discovery”
  25. 25. New Discovery Paradigm App Store / Google Play App Proprietary 3rd-Party Content Catalogue (“App Store”) Content “App Discovery”
  26. 26. Current State of the App Economy Is Netflix the “App” and the App Store the Discovery Channel? Or is Narcos the “App” and Netflix the Discovery Channel?
  27. 27. • “Content” on mobile increasingly means Video, and this is creating an enormous torrent of new advertising inventory; Current State of the App Economy
  28. 28. Current State of the App Economy Source: Zenith / ReCode Source: Cisco / AT Kearney
  29. 29. Current State of the App Economy Source: BI Intelligence Source: eMarketer
  30. 30. • “Content” on mobile increasingly means Video, and this is creating an enormous torrent of new advertising inventory; • Mobile video has impacted television viewership and movie ticket sales, and big screen advertising dollars are flowing onto mobile; Current State of the App Economy
  31. 31. Source: eMarketer Source: Zenith Current State of the App Economy Source: eMarketer Source: eMarketer Source: comScore
  32. 32. Current State of the App Economy • August 28th, 2017: three streaming video apps and one game in the Top 5 grossing (US, iOS).
  33. 33. Presentation Structure 1) Current State of the App Economy; 2) 3 Challenges & Opportunities, 2018;
  34. 34. Challenge / Opportunity: Making sense of proliferation of new platforms for user engagement / content consumption.
  35. 35. When every device is connected, every device appears to be a platform on which to develop & reach a new audience: 3 Challenges & Opportunities
  36. 36. When every device is connected, every device appears to be a platform on which to develop & reach a new audience: 3 Challenges & Opportunities
  37. 37. • Tech media sometimes uncritically promotes all emerging platforms as ascendant “next big thing”; 3 Challenges & Opportunities
  38. 38. • Tech media sometimes uncritically promotes all emerging platforms as ascendant “next big thing”; 3 Challenges & Opportunities
  39. 39. • Tech media sometimes uncritically promotes all emerging platforms as ascendant “next big thing”; • New platforms are appealing (first mover advantage, lack of price discovery, etc.) but developers need to be able to discern hype & time deployment correctly. 3 Challenges & Opportunities
  40. 40. • Example: VR vs. Mobile Gaming Source: SensorTower / Unity 3 Challenges & Opportunities
  41. 41. OPPORTUNITY: Opportunities to reach new audience emerge constantly as connected devices proliferate and create platforms; CHALLENGE: Difficult to know which platforms will truly reach scale, and being early same as being wrong. 3 Challenges & Opportunities in 2018
  42. 42. Challenge / Opportunity: The largest social networks are almost certainly facing impending regulatory scrutiny.
  43. 43. 3 Challenges & Opportunities • World governments are beginning to take note of the proliferation of disinformation / propaganda on the largest social networks;
  44. 44. 3 Challenges & Opportunities
  45. 45. 3 Challenges & Opportunities • World governments are beginning to take note of the proliferation of disinformation / propaganda on the largest social networks; • The companies that operate these networks are reacting slowly / reluctantly, and regulation seems likely to be introduced.
  46. 46. 3 Challenges & Opportunities Source: YouTube Source: The Register Source: Reuters Source: Inc.com
  47. 47. OPPORTUNITY: These types of changes are difficult for big organizations to react to and satisfy quickly, creating space for nimble companies to comply & accelerate. CHALLENGE: Laws around use (and possibly even collection) of certain data produces challenges in keeping products and advertising compliant. 3 Challenges & Opportunities in 2018
  48. 48. Challenge / Opportunity: Growth of Walled Garden advertising platforms.
  49. 49. 3 Challenges & Opportunities • The biggest mobile advertising platforms are becoming siloed, both in terms of tool offerings and inventory offerings;
  50. 50. 3 Challenges & Opportunities • The biggest mobile advertising platforms are becoming siloed, both in terms of tool offerings and inventory offerings; • The biggest inventory sources are vying to own advertiser data as a form of lock-in.
  51. 51. 3 Challenges & Opportunities Source: Google; MarketingDive
  52. 52. 3 Challenges & Opportunities Source: Facebook
  53. 53. 3 Challenges & Opportunities • Event-based bidding via machine learning makes advertising on that channel more efficient, but advertiser doesn’t own the optimization;
  54. 54. 3 Challenges & Opportunities • Event-based bidding via machine learning makes advertising on that channel more efficient, but advertiser doesn’t own the optimization; • Some platforms are merging all proprietary channels into single interfaces, mixing performant channels with non-performant and charging for all.
  55. 55. OPPORTUNITY: Platform-specific tools and inventory help advertisers reach appropriate audiences more efficiently; CHALLENGE: Walled gardens create scaling difficulty for advertisers. Analytics / infrastructure “lock in” can limit growth. 3 Challenges & Opportunities in 2018
  56. 56. Über Points / Takeaways
  57. 57. 1) The App Economy is evolving rapidly with respect to the way consumers think about “apps” and discovery; Über Points / Takeaways
  58. 58. 1) The App Economy is evolving rapidly with respect to the way consumers think about “apps” and discovery; 2) Video is the new, massive mobile frontier; Über Points / Takeaways
  59. 59. 1) The App Economy is evolving rapidly with respect to the way consumers think about “apps” and discovery; 2) Video is the new, massive mobile frontier; 3) Walled gardens are making it harder to stay technologically flexible / platform agnostic; Über Points / Takeaways
  60. 60. 1) The App Economy is evolving rapidly with respect to the way consumers think about “apps” and discovery; 2) Video is the new, massive mobile frontier; 3) Walled gardens are making it harder to stay technologically flexible / platform agnostic; 4) Increased regulation will create uncertainty / compliance overhead. Über Points / Takeaways
  61. 61. eric@mobiledevmemo.com @eric_seufert MobileDevMemo.com Thank You!

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