In-App Purchasing Webinar - Verizon Developer Community

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In-app purchases are driving a majority of mobile app revenues. In this webinar, learn how you can implement them in your own app and take advantage of the freemium app push to grow your revenues. This webinar was hosted by the Verizon Developer Community (http://developer.verizon.com) and moderated by the Wireless Industry Partnership (http://wipconnector.com).

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In-App Purchasing Webinar - Verizon Developer Community

  1. 1. •• –• –
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  6. 6. US Android Market Downloads, March 2012 (in Millions) Free (99.1%) Paid (0.9%) Source: Xyologic, April 2012 Report
  7. 7. US iPhone App Downloads, March 2012 (in Millions) Free (87.4%) Paid (12.6%) Source: Xyologic, April 2012 Report
  8. 8. Source: AppAnnie.com
  9. 9. Source: Distimo, VDC Conference 2011
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  12. 12. Average price of Top-Grossing Apps, January 2012 Source: Distimo
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  23. 23. IAP Tips and TricksVP of Production - Sean Thompson @seanethompson
  24. 24. About Mobile Deluxe• Mobile Developer since 2003• Apr. 2010 - Started Free transition• Dec. 2010 – Released free Solitaire Deluxe®• July 2011 – Overall free revenue>paid revenue • Driven by Solitaire Deluxe® (iOS) and Daily Blackjack on Verizon (Brew).
  25. 25. Free Transition• Regardless of company size, going free requires a leap of faith. • Many large, legacy developers still have not embraced free.• It’s easy to quantify paid LTV. • Net Revenue from the Purchase is LTV.• Free LTV has more possible outcomes. • You control your LTV: based on Retention and Monetization
  26. 26. Why free?• Current App Stores are open markets; anyone can enter. • Apple App store: 725,000+ apps • Google Play: 450,000+ apps • Amazon Appstore: 30,000+ apps• Premium or Free, you need users to download your app. • In a huge catalog, you are responsible for getting your app noticed. • Easier to acquire users on a free app.
  27. 27. Why IAP?• Ad supported model is entirely viable, but ad revenue will fluctuate. • Based upon the supply of ad impressions in apps and demand of ad purchasers.• IAP gives you more control over your revenue stream.• IAP allows merchandising opportunities (sales, bundles, etc.)
  28. 28. Case Study• Brew Daily Blackjack • Converted from Premium app to Free app in May 2010. • Uses Verizon AVB for IAP • Downloads increase 3000%+ • Revenue increased 500%+ • Unseated Tetris as Top Seller
  29. 29. A Simple EquationLTV > CPA
  30. 30. A Simple Equation LTV > CPATo be successful, the average Lifetime Value (LTV) of a user must be greater than the average cost of acquiring a user (CPA).
  31. 31. 5 keys for LTV>CPA1. Live App: Your app is a service2. User Acquisition: BYOU3. Analytics: Ignorance is not bliss4. Social Interactions: A must have5. Research: Do Your Homework
  32. 32. Live App:Your app is a service
  33. 33. Live App• Paradigm shift from “Release and Move On” to “Release, Evaluate & Iterate”. • Iteration is required to get your app properly tuned. • Beta test to make sure you are ready for prime time. • Bug fixing = happy customers = good ratings = more downloads.
  34. 34. Live App• Think about post-launch content releases when you design your app. • New content keeps users engaged. • Engaged users are more likely to be retained. • App updates are chance to re-engage lapsed users.
  35. 35. User Acquisition: BYOU
  36. 36. User Acquisition• If your plan is “I’m going to make a great game and [App Store] will totally feature it,” …you will most likely be disappointed.• A free app with no UA activity will get < 100 DL a day.• You must BYOU (Bring Your Own Users)! • You must develop a UA strategy!
  37. 37. User Acquisition• How we acquire users:
  38. 38. User Acquisition• You need thousands of downloads a day to yield sufficient paying users. • Far less than 5% of users pay. • Non-payers can still be valuable.• Experiment with different channels and measure the results.• All users are not created equal • Pay close attention to value of users by channel.
  39. 39. User Acquisition• Social/Viral user acquisition is vital. • Every User you get for free reduces overall CPA• If you have multiple apps, cross-selling between them is critical. • If you can pay once for a user in 2 apps, that reduces CPA.• Look to ad-swap with fellow developers.
  40. 40. Analytics:Ignorance is not bliss
  41. 41. Analytics• Analytics are not a substitute for creativity. • Retention charts wont magically give you a killer app idea. • User data wont write your code for you. • A/B testing isn’t an art style.• However…
  42. 42. Analytics• Analytics are critical to creating a successful app. • First level of analytics tells you about general app usage. • Second level of analytics helps you answer questions about why. Cohort analysis, funnels, etc… • Given the iterative nature of free apps, good data is actionable data!
  43. 43. Analytics• Some KPIs (Key Performance Indicators) we use: • Daily/Monthly Active Users (DAU/MAU) • $/DAU (or ARPDAU) • Retention Rates • LTV • $/DL • CPA (Direct and Blended) • Cross Sell %
  44. 44. Analytics• Who to use? • Flurry • Kontagent • Mixpanel • Localytics • Social Game Network (segue to…)
  45. 45. Social Interactions: A Must Have
  46. 46. Social Interactions• Why go social? • Acquisition • New users can discover you via Social Feeds • Engagement • Users are more likely to participate with friends. • Monetization • Wooga’s Diamond Dash on iOS – FB Connect users are 8X more likely to spend.
  47. 47. Social Interactions• Who to use: • Facebook • Twitter • Game Center • GREE/OpenFeint • Playphone • Papaya • Mobage • Viximo
  48. 48. Social Interactions• What to look for in a social game network: • Feature list • Cost • Analytics included • Cross-Platform
  49. 49. Research:Do Your Homework
  50. 50. Research• General Industry News: • @kimmaicutler – TechCrunch • @deantak – VentureBeat • @InsideNetwork – Inside Mobile/Social • @pgbiz – Pocket Gamer UK • @AllThingsD – WSJ/All Things Digital • @SAI – Sillicon Alley Insider
  51. 51. Research• Analytics: • The Flurry Blog: http://blog.flurry.com/ • Kontagent Kaleidoscope: http://kaleidoscope.kontagent.com/ • Distimo Monitor Blog: http://monitor.distimo.com/app-store-analytics-blog • Caryl Shaw Presentation: http://www.slideshare.net/caryl_shaw/would-you-like-some- data-with-your-coffee-aka-the-key-analytics-you-should-start- every-day-with-10031647
  52. 52. Research• Free Revenue Models: • Gamesbrief Free-to-Play spreadsheet: http://www.gamesbrief.com/spreadsheet/ • Dub It - Social Gaming Glossary: http://www.dubitplatform.com/blog/2011/12/31/the-2012- social-gaming-glossary-15-of-the-most-important-social-game- jargon/• Social Interactions: • FB Developer Showcase: https://developers.facebook.com/showcase/diamonddash/
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