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The Insider's Guide to a Billion Dollar App Business The Insider’s Guide to a Billion Dollar App Business By Peggy Anne Salz In Partnership with InMobi “Apponomics: The Insider’s Guide to a Billion Dollar App Industry” is a very useful contribution to helping folks under- stand how to address this complex topic. It’s refreshing to see such a balanced view presented; it’s neither “an easy way to make your millions” nor doom laden. It tells the simple truth that success in this market is elusive, but with careful prepa- ration you will maximize your chances.” ― Jo Rabin, Director, Mobile Monday London “Making a great app is only half of the battle, then it comes user acquisition and monetization—not always an easy feat in this rapidly changing global market. “Apponomics: The Insider’s Guide to a Billion Dollar App Industry” is full of best practices and tips from industry experts that will help any app developer improve their chances of success in this complex business.” ―Dave Westin, Co-founder, Mobile UA Fellowship The Insider’s Guide to a Billion Dollar App Business By Peggy Anne Salz In Partnership with InMobi Copyright © 2014 by Peggy-Anne Salz / InMobi All rights reserved. No part of this publication may be reproduced, distributed, or transmitted in any form or by any means, including photocopying, recording, or other electronic or mechanical methods, without the prior written permission of the publisher, except in the case of brief quota- tions embodied in critical reviews and certain other noncommercial uses permitted by copyright law. For permission requests, write to the publisher at the address below. Published by: InMobi PTE LTD 65,Chulia Street #25-01/02/03 OCBC Centre Singapore - 049513 www.inmobi.com Printed in the United Kingdom by Tyson Press Chester | London Design and Layout by SWATT Design Ltd www.swatt-design.co.uk Contents INTRODUCTION 009 Move into the mobile app fast-lane 009 Helping you navigate some tough terrain 010 01: App Market by Numbers 011 Apps take of 012 App opportunity in education 014 ‘Healthy’ app markets 015 Case Study: EFlashApps 016 App developer attitudes & choices 018 Developer population and personas 020 Case Study: Touchten 023 Tablets make their mark 025 Connectivity breeds more apps 026 SpotLight on Dev Lab 029 The three things you need to know 031 02: Your Attention, Please 033 Discovery dilemma 034 App discovery apps 036 Alternative app stores 037 Distribution DIY 040 App Publish 043 Cross-promotion 047 Case Study: Dolphin 050 Enter AppGalleries 052 App Store Optimization 054 Keyword research 056 App title and relevancy 057 App Icon 058 Making a powerful first impression 059 Guerrilla Marketing 063 Engagement marketing 064 Ken Herron’s Social Media Crash Course 065 Case Study: gamesGRABR 074 Other media in the mix 076 Networking 077 The three things you need to know 080 03: Acquiring High Quality Users at Global Scale 082 Paid promotion pays dividends 083 Driving installs 084 Non-incentivized 086 Variables to consider 089 Syncing your strategy 091 Case Study: Storm 8 092 Learning 094 Aiming for the top 096 Scale 100 Quality 104 Understanding tracking 105 Tracking for mobile apps can be complex 106 Spotlight: HasOfers 107 Device IDs 110 Browser cookies 111 Device fingerprinting 112 Winning with analytics 113 Repeat performance 114 The three things you need to know 116 04: Monetization & Optimization Crash Course 118 Making smart choices 119 Paid 119 Freemium 121 Case Study: Fingersoft 124 In-app purchase 126 IAP works for non-gaming apps too! 128 New breed of business models 130 Case Study: Learning from the King 132 Paid is dead? 133 Mobile advertising 135 Monetizing with mobile advertising 137 Case Study: Alegrium 139 Meet the mobile advertising ecosystem 141 Strategies to optimize results 145 Mobile advertising best practices 147 7 Deadly Sins of Mobile Ad Monetization 152 Hybrid models to get more out of advertising 154 Case Study: Madbit Entertainment 155 Analytics are essential 156 The three things you need to know 158 05: Get Smart About Customer Lifetime Value 160 ROI- positive metrics and mindset 161 Everything you need to know about LTV 162 More tips for calculating LTV 164 Mind the gap! 165 Maximizing LTV 167 Behavioral targeting basics 168 Keep it simple 169 Case Study: Tiny Co 172 Measurable and actionable 174 Tips to get the most out of mobile app analytics 176 Taking Control 177 InMobi Analytics 178 Mapping for success 179 The three things you need to know 181 06: Think Big, Go Global 183 Going East for opportunity 184 Penetration 187 China 187 Spotlight on the Chinese consumer 188 China’s challenges 192 Checklist: What it takes to win in China 197 Market landscape 198 Japan 198 Japan’s big app spenders 199 Market challenges 201 Spotlight on CyberZ 204 Checklist: What it takes to win in Japan 207 Market landscape 208 Korea 208 Addicted to apps 209 Case Study: GameVil 211 Market challenges 213 Checklist: What it takes to win in Korea 215 Case Study: Orangenose Studios 217 Your global playground 219 Going West with success 220 Case Study: Go Launcher 223 Localize your app 226 Case Study: J2 Interactive 228 The three things you need to know 229 07: Data-Driven Marketing in the Era of You 231 Shift happens 232 App developer disconnect 233 Your users come first 234 Data comes next 236 The significance of signals 237 Respecting privacy is best practice 238 Building better personas 241 Your app exists in an ecosystem 241 Why you can’t go it alone 243 What should you look for in a technology platform provider? 244 Moving from user personas to user stories 245 Case Study: Animoca 246 Trekking in ‘Trillions’ territory 256 Sensory explosion 257 Location meets context 259 Marketing and ‘Made Media’ 259 Loud and clear 260 The three things you need to know 262 Appendix 264 ‘Helpful Tips’ Sheet: Ad Creative 265 ‘Helpful Tips’ Sheet: How much can it cost? 272 ‘Helpful Tips’ Sheet: How many markets should you target? 274 ‘Helpful Tips’ Sheet: What are the sure signs of success, or failure? 275 ‘Helpful Tips’ Sheet: Targeting 276 Endnotes 278 Glossary 282 App-solutely essential industry contacts 289 Expert Contributors 300 InMobi Insight’s Provided By 312 The Team 317 The InMobi Team 319 INTRODUCTION Move into the mobile app fast-lane It’s no longer a secret that creating apps has become a serious source of income for thousands of app developers across the world. And while developing apps has become a profession for many, not all developers have mastered the final step: How to grow the user base and make money? The voracious speed at which the app industry continues to evolve, and the scores of products, tools and platforms available to build and monetize apps, can often overwhelm an app developer who is attempting to build a sustainable business. At InMobi, our customers range from large developer studios that make hundreds of millions of dollars annually, to much smaller app developers who fight for survival with minimal marketing resources. We have aided in building global success stories among this diverse group of app developers and have played a pivotal role in guiding them through their journey to become successful “appre- neurs,” including expansion from West to East, or the opposite direction, and entering key inter- national markets like China and the U.S. InMobi solutions address the app developer’s needs across the entire app lifecycle, including app discovery & distribution, user acquisition, monetization, engagement, and retention. Our finely tuned best practices, deliver real value at every phase of the app lifecycle. We have created this book to share our six years of insights on the app business, complete with real world case studies, developer interviews, and in-depth research to produce a practical guide that can help you, the developer, navigate the complexities of the app world. This book is an advanced guide to user acquisition and monetization, providing tips, tricks, and practical advice to turn your app into a global business. We hope you find this book useful and that your app finds the success it deserves! Naveen Tewari Founder & CEO, InMobi APPONOMICS: The Insider’s Guide to a Billion Dollar App Business 009 Helping you navigate some tough terrain Apponomics: The Insider’s Guide to a Billion-Dollar App Business is your roadmap to sustainable success, guiding you through the steps you need to follow to acquire quality users and make money from your mobile app. Drawing from extensive market research and exclusive interviews with senior executives from companies across the ecosystem, this book is chock-full with lessons, learnings and best prac- tices around targeting, acquiring and keeping loyal users. From popular cross-platform tool providers to leading app data companies, and from regional app marketing gurus across China, Japan and Korea, to super-successful app companies that hit it big, this book uniquely gives you the inside track on everything you need to market and monetize your app. It’s both exciting and terrifying to think about the opportunities that lay ahead for your business. And it’s no coincidence that developers everywhere are scrambling to produce a compelling app. My first mobile app book, The Everything Guide to Mobile Apps: A Practical Guide to Afordable Mobile App Development for Your Business (F+WMedia Inc.), provided companies, marketers, brands and newbie app developers a crash course in the basics to help them on their first app adventure. The new and advanced guide, researched and written in close collaboration with InMobi, takes all this to the next level. Bringing together exclusive interviews and in-depth market data, this book tells you what it takes to turn your app into a serious — and sustainable—business.
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