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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  • 1. Best Practices for Growingyour Mobile App BusinessProven ways to increase your ROIand get your app in the hands of loyal users

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 youre like most companies, youre 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.com2 3. Although youre competing with hundreds of thousands of other apps, youcan take solace in the fact that youre 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 didnt 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 dont 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 theres 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.Its all extremely time-consuming.Were having some success, but we can do much better. We just dont 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 were 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 youre stuck.Best Practices for Growing your Mobile App Business www.fiksu.com3 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 apps 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 dont 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. 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 theyre not achieving their goals.So why isnt 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.Lets explore each of these in further detail.Best Practices for Growing your Mobile App Business www.fiksu.com 5 6. Why todays 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, youre at considerable riskof limiting your results. For example, when working with only three mobilead networks, youll 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, youre 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.com6 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:Its 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?Theres 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, its 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 cant 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 apps 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.com7 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. Its 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 donttrack 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, its 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.com8 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 ofnumber 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 youre a retailer, a loyal user may be acustomer who makes a purchase. If youre 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. 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. 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 measureorganic 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 Apples App Store is the ratio of organicdownloads per ad-driven downloads.Android MarketIn the Android Market, the driver of organic lift is very different fromApples App Store. In the Android Market, app usage is key to drivingorganic downloads.As you acquire new users, the apps usage increases. As that usage in-creases, so does the apps 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.com11 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.Whats the best category for your app?What is your optimal rank position within that category?The answers are simple: Its 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...