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DEVELOPER ATTITUDES to 2013 2013 APP MARKETING Mobile app developers share their opinions on the state of app distribution and monetization appflood.com

DEVELOPER ATTITUDES to APP MARKETING...DEVELOPER ATTITUDES to 2013 APP MARKETING Mobile app developers share their opinions on the state of app distribution and monetization appflood.com

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Text of DEVELOPER ATTITUDES to APP MARKETING...DEVELOPER ATTITUDES to 2013 APP MARKETING Mobile app...

  • DEVELOPER ATTITUDESto

    20132013

    APP MARKETINGMobile app developers share their opinions on the state

    of app distribution and monetization

    appflood.com

  • Executive SummaryWith the growing volume of mobile apps available in app stores

    and markets, user choice is at an all-time high. At the same time,

    app development is becoming riskier and developers are finding it

    increasingly difficult to attract, retain and monetize users effectively.

    The key findings from this report show app developers, particularly

    smaller indie developers, are not clear on the benefits of different

    mobile marketing channels. A lack of clarity and trust in ad network

    providers are the main reasons why 70% of developers are frustrated

    with the current state of app marketing.

    Trust was seen as the most important factor in determining which

    advertising network to choose for app launches while surprisingly,

    cost was only the third most important factor. Even though trust was the most important factor, most developers

    felt ad networks were not honest about their revenue claims with 71% of developers expressing the view that eCPM

    (effective Cost Per Thousand Impressions) was exaggerated.

    With trust such an integral issue for developers, most were found to be adopting a “do-it-yourself” approach to app

    marketing and the majority (78%) spending less than USD$5,000. Smaller developers said they “took a chance” when

    it came to app marketing.

    Developers gravitate towards big name ad networks and service providers in the belief that they can “trust” these

    brands, however, the vast majority of developers are unhappy with the results, suggesting a gulf in expectations

    between themselves and the ad network providers.

    Ad providers must work harder in gaining back this trust and expanding app developers’ marketing knowledge.

    To achieve this, they must be more transparent with their app marketing offerings and provide better tools to help

    developers to understand and calculate return on investment for their app marketing campaigns.

    Developer Attitudes to App Marketing | 1

    “A lack of clarity and trust in ad network providers are the main reasons why 70% of developers are frustrated with the current state of app marketing.

  • The Developer Attitudes to App Marketing report analyses the findings of a survey carried out by AppFlood with the

    goal to better understand developers’ perspective regarding the complexities of app marketing.

    The survey was undertaken across 1022 app developers of varying sizes. Throughout this report we compare

    results between large, medium and small developers. Large developers are defined as those with more than 51

    staff, medium with 16 to 50 staff and small having 15 or under.

    The survey looks to address attitudes across two segments. The first section is around developers acquiring new

    users/customers and the second section looks at how developers are making money by publishing advertising

    inside their apps.

    About this Report

    AppFlood is a mobile advertising and cross-promotion network for Android and iOS developers who want to buy, sell,

    and exchange users for free. AppFlood enables developers to earn at least 40% more revenue than traditional mobile

    ad networks. Being completely commission-free also makes AppFlood the most neutral, transparent network in the

    industry with leading data visibility, campaign controls and deeper insights developers trust.

    AppFlood launched in July of 2012 and has since acquired over 3,000 developers using its services every day. More

    information can be found at http://appflood.com or alternatively contact [email protected]

    AppFlood comes from the mobile distribution and monetization company PapayaMobile, providing software tools for

    Android and iOS developers to create freemium mobile social games. Papaya hosts games on its self-titled mobile

    social network which has over 80 million worldwide

    users. Papaya was founded in 2008 by CEO Si Shen

    and CTO Qian Wenjie. It has its headquarters in Beijing

    and offices in San Francisco and London.

    About AppFlood

    Developer Attitudes to App Marketing | 2

    gsocial games. Papaya hostsp y

  • Acquiring Users

    Small developers are the most frustrated with app distribution at 72% versus large developers who are the least

    frustrated at 62%. Overall, the variation is not huge and it appears that across the board developers in general are

    frustrated with existing app distribution methods. However, greater frustration amongst smaller developers stands to

    reason as increasingly they have to undertake the role of marketing manager and commercial manager and analyst if

    they wish to publish and promote their own apps.

    The complexities that come with analyzing customer acquisition campaigns through the use of in-app analytics and

    other tools means that the average developer may lack the necessary skills to do this and thereby acquire customers

    optimally/effectively as well as monetize those that have already been acquired. In contrast, larger developers have

    access to greater resources and so can spend more time and effort on test campaigns as well as analyzing the results.

    Frustration all round

    Developer Attitudes to App Marketing | 3

    Have you ever felt frustrated with app distribution?

    Big developer

    Medium developer

    Small developer

    20% 40% 60% 80% 100%

    Yes

    No

    This section looks at developer attitudes towards marketing apps and acquiring customers.

    “One developer described their experience in frank terms. “Mobile Advertising in general is a huge pain in the ass”.

  • Overall, the majority of app developers surveyed had tried mobile advertising to acquire customers. Medium

    sized developers seem to have used mobile advertising the most at 65% versus large developers at 61%. It is

    no surprise that small developers lag behind at around 50%.

    Majority have paid for mobile advertising

    Developer Attitudes to App Marketing | 4

    Yes

    No

    Big developer

    Medium developer

    Small developer

    20% 40% 60% 80% 100%

    Have you ever used mobile advertising to acquire customers?

  • $10,001+ $5,000 -10,000 $4,999 or less

    Big developer

    Medium developer

    Small developer

    20% 40% 60% 80% 100%

    What was your allocated budget?

    Whilst small developers have the smallest allocated marketing budget with 88% having under $5,000, it was very surprising

    to see that the medium sized developers actually have higher budgets allocated than the large ones of whom 48% have

    allocated $5,000 or under.

    Smaller developers often cited worry in losing too much money when starting out and having nothing to show for it as the

    primary reason for their reluctance to invest more in marketing.

    Small developers rarely spend $5,000 or more on app marketing

    Developer Attitudes to App Marketing | 5

    “One small developer explained,“I am just getting started in mobile advertising. It has been a learning experience.”

  • The most popular acquisition tool for all three groups was cost per click ad network (CPC) with 51%, 55%, and 58%

    of small, medium and large developers respectively saying they had used it ahead of install networks. Most surprisingly

    though was the high instance of web advertising and site sponsorship across the three groups with 42%, 53%, and

    56% respectively having paid for site banners, sponsorship or takeovers. This is surprising considering the difficult

    nature of tracking conversions from web to mobile. This route does have brand awareness value, but this might be

    difficult to justify for most developers, considering the high cost per acquisition.

    Most developers are still not investing in using a specialist PR agency or cannot currently see the value. Double the

    amount, or 18% of large developers had used a PR agency versus 9% of small and medium developers.

    Mobile CPC is still the most popular paid acquisition channel

    Developer Attitudes to App Marketing | 6

    App review website

    Specialist PR agency

    Cost per thousand

    Cost per click

    Site sponsorship

    Traffic exchange

    Non-incentivized installs

    Incentivized installs

    20% 80%40% 60% 100%

    Which marketing methods have you used to acquire customers?

    Big developer Medium developer Small developer

  • The overwhelming factor that determined which network or service to use was trust. Being able to trust in a provider

    to deliver positive results at an appropriate price is most important to large developers of whom 57% said it was

    a key factor versus 47% of small and medium developers. Trust and prior awareness of a service seem to be the

    key determinants across all three groups for choosing a network or marketing service, but the service that gave the

    cheapest cost was also important to all three. Of the three groups, small developers take the biggest leap of faith

    with 26% of them saying that they had simply ‘taken a chance’ versus 18% of medium and 11% of large developers.

    Trust is the biggest determining factor in choosing a marketing service

    Developer Attitudes to App Marketing | 7

    I took a chance

    20% 40% 60%

    How did you decide which network or service to use? (Advertisers)

    80% 100%

    Big developer Medium developer Small developer

    An agency managed it for me and Ileft them to do it

    I used a service that was recommendedto me by someone I trust

    I used a service that I know about themost

    Gave me the cheapest costs/maximum return on investment

    I used a service I trusted

    I used a service that promised themost installs

  • Small developers expressed the highest degree of dissatisfaction regarding the value for money of acquiring customers, with

    53% saying it was too expensive versus 33% of large developers. Large developers are likely to be the most satisfied as they

    have the resources and skills to acquire customers more effectively and to be more analytical in their approach.

    Do you feel that users you acquired were good value for the money?

    Small developers feel users acquired were not good value for money.

    Cheap, a bargain Priced just right Too expensive

    Big developer

    Medium developer

    Small developer

    20% 40% 60% 80% 100%

    Developer Attitudes to App Marketing | 8

    “On starting out in app marketing, a small developer explained “[The challenge is] figuring out how to get started without losing a lot of money in the beginning.” Another echoed this sentiment, saying, “Just money disappearing rapidly and not getting any results... the usual”.

  • Many developers are choosing to manage their own campaigns in house (versus using an external agency). This

    is still the case with larger developers, 70% of whom still manage their own campaigns. Over 80% of medium

    developers managed the campaigns themselves which is surprising as they had more generous budgets allocated

    for app marketing.

    Did you or someone in your company manage the process of booking the advertising and monitoring it?

    Most developers are managing their own campaigns

    Yes

    No

    Big developer

    Medium developer

    Small developer

    20% 40% 60% 80% 100%

    Developer Attitudes to App Marketing | 9

  • On a scale of 1-5 how clear was the information that you received on the following advertising metrics?

    LTV (lifetime-value of customers)

    Min. bid per publisher

    eCPM per publisher

    Click through Rate (CTR)

    Ad Impressions

    Clicks

    Installs

    ROI (return on investment)

    Retention

    Clicks, impressions and installs are generally felt to be clear.

    Behavioral and ROI data is still not clear enough

    1 2 3 4 5

    1- no information 5 - full information

    Developer Attitudes to App Marketing | 10

  • Have you ever used an advertising network to grow revenues?

    Publishers

    Pretty much all three groups are equal in their response to having used an ad network to grow ad revenues with 54%, 58%,

    and 57% saying ‘yes’ respectively.

    Those developers that didn’t employ mobile ads in their games felt the revenue earned was not enough to justify the additional

    annoyance. One developer stated that mobile ads “generated so little per month. It’s just not worth annoying people with ads.”

    Over half have monetized through ads

    Yes

    No

    Big developer

    Medium developer

    Small developer

    20% 40% 60% 80% 100%

    Developer Attitudes to App Marketing | 11

    This section looks at how developers have monetized their own apps by acting as publishers.

  • Trust was the main factor in selecting a network for medium and large developers with over 66% citing it as a key

    decision making factor. Once again, small developers are overwhelmingly leaving things to chance, at 22%, versus

    9% of medium developers and 10% of large developers.

    Trust is also the key decider for publishers

    Big developerMedium developerSmall developer

    I took a chance

    20% 40% 60% 80% 100%

    An agency managed it for me and I left them to do it

    I used a service that was recommended to me by someone I

    trust

    I used a service that I know about themost

    I used a service that gave me thecheapest costs/maximum return on

    investment

    I used a service I trusted

    I used a service that promised themost installs

    How did you decide which network or service to use? (Publishers)

    Developer Attitudes to App Marketing | 12

  • Have you ever felt that the eCPM claims for a network were exaggerated?

    Overall, medium developers are the most dissatisfied with the eCPM* claims of networks, with over 80% citing

    they felt they were exaggerated versus 70% of small developers and 60% of large developers. Large developers

    are therefore the most satisfied of the three groups. Developers stated that eCPMs would be used to lure them in

    but these would often only last for a short period before falling.

    App developers generally do not trust revenue claims

    Yes

    No

    Big developer

    Medium developer

    Small developer

    20% 40% 60% 80% 100%

    Developer Attitudes to App Marketing | 13

    “One developer said, “To get customers, most of the ad networks use a dishonest way of promising high eCPMs and delivering it - but only in the first month. Then results become worse and worse every month.”

  • Currently, developers instinctively gravitate towards big name ad networks and service providers in the belief that

    they can “trust” these brands to offer an effective app marketing service. However, the fact that the vast majority

    of developers – especially smaller ones - are also unhappy with the results achieved relative to the cost suggests

    a gulf in expectations between themselves and the ad network providers.

    To properly earn the trust of today’s cost-conscious developers, for whom meaningful results and a positive ROI

    on their marketing investment are a priority, ad providers must be prepared to be more transparent with their app

    marketing offerings - especially around campaign planning, reporting, and measurement.

    Conclusions

    Developer Attitudes to App Marketing | 14

    “One Indie app developer sums up their struggle in personal terms, “I put more money in than I see returned. [It’s a] Sad story for an Indie developer who is struggling to support his family.”