Best Practices for Growing your Mobile App Business

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Proven ways to increase your ROI and get your app in the hands of loyal users

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Best Practices for Growing your Mobile App Business

  1. 1. Best Practices for Growingyour Mobile App BusinessProven ways to increase your ROIand get your app in the hands of loyal users
  2. 2. Competing For UsersWith more than half a million mobile apps competing for users,how do you make certain that your app:• Is ranked highly enough to be discovered?• Gets enough cost effective downloads to scale your business?• Is downloaded by loyal users who are profitable?And how do you accomplish all this without draining your budget in the process?If you’re like most companies, you’re struggling for answers.The good news is that a new technology platform is in use today by topbrands and leading app developers to overcome these challenges, andbuild successful, sustainable mobile app businesses.Best Practices for Growing your Mobile App Business www.fiksu.com 2
  3. 3. Although you’re competing with hundreds of thousands of other apps, youcan take solace in the fact that you’re not alone – because your competitorsare facing the same challenges:Overcoming the ChallengesThe costs to find users are too high.What most app marketers will tell you is, “We took a financial beating tryingto get users. We spent a ton of money and didn’t get any volume at all.” Andmany who did get the volume say, “We spent tons of money on volume, butour cost-per-user was orders of magnitude higher than our business plan.”Finding users is complex, and we don’t fully understand it.“We have a great app, but we have no idea how to get our app into the handsof users. This is all new to us, and there’s really no way to know for sure ifour advertising will deliver the results we need. So we experiment and testand hope we hit our target.”It’s all extremely time-consuming.“We’re having some success, but we can do much better. We just don’t havethe bandwidth to make it happen fast enough. The ad networks are getting usdownloads, but they have no way of telling us if the downloads translate intoprofitable users. The problem is that it is much too time-consuming to workwith multiple traffic sources, and we have limited staff to make it happen.So we feel like we’re settling.”The market keeps changing.“Just when we figure out how to market our app, the app stores make changesthat render our marketing obsolete.”So you’re stuck.Best Practices for Growing your Mobile App Business www.fiksu.com 3
  4. 4. But how can you ensure that your app achieves the highest possible numberof downloads to support your business model when there are over a halfmillion apps competing for users?The best way for your app to be discovered is for it to be listed in the topranks within your app’s category. But there are so many other apps battlingfor a fixed number of slots on a daily, or even hourly, basis. And every day itbecomes more challenging to compete because the number of slots is fixedwhile the number of apps fighting for those slots increases.Simply put, if you don’t solve this problem, you may not have a business.But how do you solve it?Best Practices for Growing your Mobile App Business www.fiksu.com 4
  5. 5. The Unfortunate RealityYou may find yourself in an unfortunate reality that is also faced by yourcompetitors. You have little choice but to give your money to an ad networkand hope it delivers the results you need. What most organizations arefinding, though, is that they’re not achieving their goals.So why isn’t this working?There are several reasons why your approach may not be working to thedegree you require. Here are three of the most common reasons:1. You may not be working with a full complement of traffic sources.2. You may not be tracking ad performance and optimizing ad spend in real time.3. The fact is that ad networks are not focused solely on your needs.Let’s explore each of these in further detail.Best Practices for Growing your Mobile App Business www.fiksu.com 5
  6. 6. Why today’s approach may not be working.1. You may not be working with a full complementof traffic sources.To achieve peak results, it is vital to generate traffic from a variety of sources including: • Ad Networks that display your ads on their network of mobile publishers. • Real-Time Bidding Platforms that allow you to bid on traffic in real time. • Incentive-Based Download Programs that allow you to bid on downloads by users who are incentivized to download your app.By limiting the number of traffic sources you use, you’re at considerable riskof limiting your results. For example, when working with only three mobilead networks, you’ll be missing opportunities to identify potentially higherperforming traffic from many other available ad networks; sources that canlead to larger numbers of loyal users. In addition, you’re not maximizing yourROI over a larger audience by identifying opportunities for lower acquisitioncosts. And finally, by working with a small number of traffic sources, you arein danger of subjecting your app to audience saturation.Successful mobile app marketers recognize that working with several trafficsources and ad networks increases their success. Casting a wide net acrossmultiple networks is more efficient than working with one network and canbe more effective by a factor of 10X.Best Practices for Growing your Mobile App Business www.fiksu.com 6
  7. 7. But working with multiple traffic sources is easier said than done.It is extremely challenging to work with multiple traffic sources, letalone multiple properties within each source type. Some of thesechallenges include:It’s complex and time-consuming.Working with just one or two networks is complex and time-consumingenough. So how can you possibly work across dozens of traffic sourcesspanning numerous networks, real-time bidding platforms and incentivebased programs? Working with multiple networks increases the workloadand complexity exponentially. How many people would you have to hire tomanage multiple insertion orders, consolidate different types of reports,and conduct ongoing performance analysis?There’s no way to measure user value.Not all users have the same value. Some users have a higher propensity toview ads, some will complete a registration, and others will make a purchase.In this regard, it’s important to measure the quality of users acquiredthrough each traffic source to determine exactly how much each user isworth, to ensure traffic sources are ROI positive.Disparate reports are difficult to track.Each network provides a different type of report, tracking different types ofdata. For example, some networks report that a download occurs on the dayan ad is displayed. Others report when the app was physically opened thefirst time. Data is reported differently from network to network, and somehowyou need to reconcile this. It takes an enormous amount of work to consolidateall of these reports, and without the ability to do so, you can’t identify the bestvalue for your spend.There are numerous technical complexities.Each traffic source requires you to embed tracking code into your app. Allthis code can compromise your app’s performance and cause several technicalcomplexities. Moreover, the need to write multiple lines of code requiresengineering time and resubmitting to the app store for each additional trafficsource, and there are dozens of traffic sources out there.Best Practices for Growing your Mobile App Business www.fiksu.com 7
  8. 8. 2. You may not be tracking ad performance andoptimizing ad spend in real time.To get the highest possible return from your ad spend, you must continuouslytrack and analyze all of your ads’ performance variables and make adjustments,ideally in real time. It’s complex and time-consuming to do this when workingwith just one network, let alone several. You may not have the in-house expertiseor the tools to perform the necessary analysis and adjustments. But if you don’ttrack performance and adjust your ad buy in real time, you may be spendingtoo much or missing out on users from the best performing sources.3. Ad networks are not focused solely onyour needs.Ad networks serve, not only you, but also the publishers within their networkswho display your ads. It is in the networks’ best interest to give business toeach of their publishers, and this could be in direct conflict with your objectives.So while the networks are important to your business, it’s up to you to usethem properly. You must be pro-active about identifying the publishers withinthe networks on which to place your ads. Then you have to continually trackperformance and adjust your ad spend based on this performance.More importantly, the networks do not have the ability to focus your ad spendon delivering the types of users you need most:Organic Users and Loyal Users.While it is true that rank and downloads are critical to your success, in reality,they are just a means to getting what you really need: organic users andloyal users.No ad network has a method for understanding how to acquire organic usersand loyal users. Ad networks are focused primarily on two things: ads andclicks. So it needs to be up to you to place a strong emphasis on drivingdownloads from organic users and loyal users. But what are organic andloyal users?Best Practices for Growing your Mobile App Business www.fiksu.com 8
  9. 9. Organic UsersOrganic users are users that actively seek and download your applicationfrom app stores without seeing an ad. According to data compiled fromFiksu, Inc. research, these users are significantly more likely to becomeloyal users than those who download your app after viewing an ad.Therefore, as you develop your user acquisition plan, think not only in terms of“number of downloads,” but also think in terms of “number of organic users.”Loyal UsersAt the end of the day, you want downloads by loyal users because loyal usersuse your app repeatedly, make purchases, and spread the word on your behalf.It is loyal users on whom you build your business. A download, or even an applaunch, does not mean that you have a loyal user.So what is a loyal user? Depending on your business, a loyal user can bedefined differently.If your company is membership-based, a loyal user might be someone whoregisters and becomes a member. If you’re a retailer, a loyal user may be acustomer who makes a purchase. If you’re an app developer who relies onin-app ad revenue, a loyal user may be someone who opens your app atleast five times, making himself or herself available to see ads.Rapid and sustainable app-business growth is all about finding loyal users.However none of the ad networks have a viable method for understandinghow to obtain loyal users.This is up to you.Best Practices for Growing your Mobile App Business www.fiksu.com 9
  10. 10. Best Practices Following are proven best practices for promoting your app for profitable and sustainable loyal user acquisition and business growth. By employingFor Acquiring these best practices, you can overcome the challenges outlined in the previ- ous pages, and greatly increase the likelihood of finding the right users at the right cost.Loyal Mobile 1. Work with as many traffic sources as possible. If you are working with only one traffic source type (mobile ad network, realApp Users And time bidding platform, incentive based program), or even just one of each type, it really is too small a universe to be successful. You are missing out on valuable opportunities to identify the best traffic sources for driving the larg-Growing Your est numbers of loyal users, and to scale your business. By working with several ad networks, you can also insulate yourself from satu-Mobile App ration on any one network, which typically results in higher acquisition costs. The best scenario is to try to work with as many traffic sources as possible.Business This will enable you to reach your largest potential audience, realize the lowest-possible acquisition, and also protect your app from audience satu- ration. To attain the best results, app marketers should track users from at least ten traffic sources and at least two of each traffic source type. 2. Focus on acquiring downloads from loyal users. None of the ad networks have a method for understanding how to deliver loyal users, so you must take the initiative. The best ways to get loyal users are to: 1. Define the characteristics of your loyal user. 2. Automate the tracking of these loyal user characteristics. 3. Identify the traffic sources that generated these loyal users. 4. Steer your ad spend toward these traffic sources. 5. Track all of your users’ interactions with your app. Best Practices for Growing your Mobile App Business www.fiksu.com 10
  11. 11. 3. Drive and track downloads from organic users.Organic users, those who actively seek and download your application withoutany marketing influence, have a much higher lifetime value than ad-drivenusers. These are the users you should target as they have a higher propensityto become your loyal users.Your starting point for acquiring organic users is to establish and measure“organic lift.”A vital dynamic that exists in mobile app advertising is the tight relationshipbetween conversions, rank and the effect both have on generating organicusers. This relationship is called “organic lift.” This is the natural “coattaileffect” that conversions have on the acquisition of organic users. There aredifferent ways to track organic lift in the Apple and Android app stores.Apple App StoreIn the App Store, ad-driven downloads improve rank, which allows more usersto discover your app organically and, in turn, increase organic downloads.Therefore, conversion to organic lift in Apple’s App Store is the ratio of organicdownloads per ad-driven downloads.Android MarketIn the Android Market, the driver of organic lift is very different fromApple’s App Store. In the Android Market, app usage is key to drivingorganic downloads.As you acquire new users, the app’s usage increases. As that usage in-creases, so does the app’s rank within the Android Market. This improvedranking is what yields the higher number of organic downloads. The goodnews for advertisers is that, once improved rank is achieved, the rank doesnot degrade the minute an advertiser stops spending. As such, the advertisercontinues to enjoy incremental organic downloads beyond those generatedduring a campaign.Best Practices for Growing your Mobile App Business www.fiksu.com 11
  12. 12. Over time, you can develop profiles for organic users and ad-driven usersto understand what your loyal user funnel looks like to help guide your adspend and measure ROI.As you track your advertising program over time, be sure to continuouslytrack organic lift and use this as a key measurement to help guide yourad spend.4. Determine your optimal category and rank position to maximize costper loyal user.What’s the best category for your app?What is your optimal rank position within that category?The answers are simple: It’s the category and rank that generates the mostloyal users for the lowest cost possible. Unfortunately, testing various cate-gories and rank positions is a time consuming challenge. Here are some tipsfor defining your optimal category and rank position:CategoryMost apps can fit in multiple categories. For example, many games containaspects of Social Networking, Music or Entertainment. Rather than defaultingautomatically to the Games category, consider whether or not your app wouldbe better differentiated in an alternative category.Rank – In CategoryDepending on your category, you will set a different optimal rank target. Forexample, if your app is in a large category, such as Games, your rank ob-jective may be to get into the top 25. Conversely, if your app is in a smallercategory, your objective may be the top five.Further complicating this is that some apps get no more organic users at arank of 15 than 25. So why pay for rank 15 when there is no difference be-tween organic lift in rank 15 or 25?Best Practices for Growing your Mobile App Business www.fiksu.com 12
  13. 13. Gain an understanding of your optimal rank, and track performance continu-ously to ensure that you are not spending more than you need to spend. Thiswill also ensure that your rank position is delivering the required number ofusers.Rank – OverallFurther complicating matters is the need to understand how overall rankimpacts organic lift. Both the Apple and Android stores measure overall rankacross all categories. This overall rank is highly visible in both app storesand, as a result, the overall rank can have a dramatic effect on organic lift.App Marketers seeking the highest possible organic lift ratio may be betterserved seeking the optimal overall rank position regardless of category rank.As such it’s just as important to test organic lift based on overall rank andcategory rank.5. Understand the number of loyal users generated from eachtraffic source.Based on your definition of a loyal user, gain an understanding of the numberof loyal users you are generating from each ad network and traffic source,and at what cost. Be sure to consider which intra-network sources are yield-ing the most efficient traffic, and consolidate spending to those sources.6. Insulate yourself from variations of available traffic at a given bid.Traffic variations, and therefore ad costs, can change on a daily basis. Forexample, you may get a lot of traffic for five cents per click on one day, andthe next day that same traffic costs 10 cents per click. Your costs just doubled.You can insulate yourself from these fluctuations by tracking traffic variationson a continuous basis, and moving your ads to more cost-effective traffic sources.7. Define lifetime value per user.Define your lifetime value per user to determine how much you’re willing tospend to acquire a user.Best Practices for Growing your Mobile App Business www.fiksu.com 13
  14. 14. 8. Define cost-per-conversion.Determine your cost-per-conversion target for a given volume of users. Youmay be able to get away with a nickel per click, but to double your volume youmay have to pay 15 or 20 cents per click. It’s important to understand howmuch to bid for a given volume to deliver the best possible ROI.9. Target best-performing days of the week.Understand which days of the week are best for acquiring loyal users andadjust your ad spend accordingly.10. Track ad performance based on downloads.Determine which ads and traffic sources achieve the highest download rates,rather than click through rates, because you don’t want to pay for clicks thatdon’t lead to downloads.11. Define your app title with the goal of conversions.Define your app title not only in terms of brand but also in terms of app storesearch results and conversion of users who arrive on your app store landingpage. For example, if you have a photography-oriented app, speak to the func-tionality of the app in its title. This way when a user searches for “picture color”you are as likely to appear in the app store search results as “Photography.”Best Practices for Growing your Mobile App Business www.fiksu.com 14
  15. 15. 12. Write your landing page copy for consumption on mobile devices.Compose store landing page copy not for how it looks on the desktop wheremost people proofread it, but as it appears on the device where the majorityof app download decision-making occurs.13. Test different creative.Conduct a/b testing of your ad creative across all traffic sources to determinewhich ads perform the best and swap out lower-performing ads on a persource basis.14. Use short and punchy ad copy.Your ad should be more similar to search engine AdWord copy rather thantraditional ad copy because you have limited space. Less is More.Best Practices for Growing your Mobile App Business www.fiksu.com 15
  16. 16. Put These Best Practices To Work For You A breakthrough mobile app user acquisition platform has made these best practices a reality for many of today’s leading companies, from established consumer brands to fast growing mobile ventures, looking to build scalable businesses around their mobile apps. The Fiksu™ for Mobile Apps user acquisition platform was developed by a team of seasoned entrepreneurs and PhDs, and is used by leading businesses to overcome the challenges of generating large quantities of loyal app users, while lowering user acquisition costs by as much as 10X. With the Fiksu platform, businesses are able to: • Easily work with all ad networks • Track ad performance and optimize ad buys in real time • Generate more organic and loyal users at a lower cost The Fiksu platform reaches the largest potential mobile audience and con- verts a significant volume of new users at substantially lower user acquisition costs. Often, the platform delivers a download for about the same cost as a keyword click. Following are actual results Fiksu achieved for the app Fluent News™ Reader. These results are typical: Before Fiksu With Fiksu Category Ranking Top 100 Frequently Top In Category Downloads per month 10,000 300,000 Average cost per download $3.00 $0.20 Cost per loyal user Unknown $0.30 Best Practices for Growing your Mobile App Business www.fiksu.com 16
  17. 17. Fiksu technologyWith over 55 million downloads attained; the Fiksu platform has compiledextensive amounts of data that gets deeper and smarter with every download.The Fiksu platform employs a breakthrough predictive algorithm that convertsthis intelligence into real-time actions that: • Optimize traffic allocations in real time • Raise an app’s rank in app store environments • Improve cost/performance • Generate ad-driven and organic downloads and use by loyal usersThe Fiksu platform tracks user interactions with your app after it’s download,and applies this intelligence to ongoing ad purchases to generate a higherpercentage of loyal users. In addition, Fiksu measures the interaction betweenadvertising and rank to optimize the two variables for the lowest possibleacquisition cost per loyal user.Fiksu’s focus is on optimizing your marketing spend to generate loyal users.This is achieved by associating app usage data with the channels and timesin which the users were acquired, to continually improve marketing spendallocation. Thus far, Fiksu has utilized data from over 1.6 billion app opens tocost-effectively deliver loyal users to its clients – typically for less than $1.00each and sometimes for as low as $0.45.Best Practices for Growing your Mobile App Business www.fiksu.com 17
  18. 18. Work with all traffic sourcesThe Fiksu platform spans the entire mobile app ecosystem including an ex-tensive number of ad networks, real-time bidding platforms, and incentivizeddownload programs. Fiksu’s intelligent algorithms optimize results in realtime, not just within each of these sources, but also across all of the sources.Managed technology platformThe Fiksu platform is accessible to any company as a fully-managed technologyplatform. There is nothing for your staff to learn or to operate. When you usethe Fiksu platform, you are assigned an expert Fiksu project manager who isdedicated to achieving results.Fiksu takes the complexity out of tracking and reporting. You need only onepiece of tracking code and one insertion order to run ads on all the networks.With just one interface, you get a comprehensive view of all of your key metricsin real time, and gain intelligence on what really matters.Best Practices for Growing your Mobile App Business www.fiksu.com 18
  19. 19. Fiksu, Inc.101 Arch Street Suite 304 Here’s Your Next StepBoston, MA 02110 Discover how the Fiksu platform can get you fast and predictable results. To learn more, or to set up a test, please contact Fiksu today. sales@fiksu.com :: email follow us: 1.855.463.4578 :: telephone www.fiksu.com :: website www.fiksu.com/blog :: blogCopyright © 2011 Fiksu, Inc. All rights reserved. Fiksu, the Fiksu logo, and Fluent News are trademarks and Get Loyal App Users and the Get Loyal App Users logo are service marks of Fiksu, Inc. Appleand the App Store are registered trademarks of Apple, Inc. Android is a trademark of Google, Inc. All other trademarks mentioned herein are the property of their respective holders.

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