Архив метки: App Center

W3i: App Marketing Costs On The Rise, Jump 56% On iOS, 70% On Android Since January


It’s no secret that the mobile app landscape has become extremely competitive. Over the last few years, this has led to an incredible amount of innovation and progress, but the cost of visibility — of acquiring new users — is also on the rise. In fact, Fiksu found that the cost of acquiring users hit a record high in December. While December is a critical month for app discovery, it remained to be seen whether or not this trend would continue.

Today, W3i, the monetization and distribution network for app developers, released new user acquisition figures for the first half of 2012, and the results tell the same story and are worrying for developers. Assessing hundreds of millions of mobile users from January to June 2012, W3i found that the average cost-per-install (of CPI) of mobile apps increased by 70 percent on Android and by 56 percent on iOS.

By June, the cost-per-install on Android had risen from $0.30 to $0.51, while iOS CPI has increased from $0.59 to $0.92.

W3i attributed this increase, in part, to mobile gaming giants like DeNA have entered the U.S. market, a prime example of the fact that, for the first time, billion-dollar companies are now competing with small to mid-sized developers. As free-to-play giants leverage their huge marketing budgets to help attract new users, the overall cost of user acquisition has increased — making it increasingly difficult for developers who are trying to make a living in apps.

“The entire user acquisition market is undergoing a sea change that will require mobile developers to re-think how they obtain and monetize their users,” said Robert Weber, co-founder of W3i. “This could be the ‘innovate or die’ moment for a lot of developers as the competition for mobile users continues to heat up.”

Many were surprised when popular Mac and iOS email client Sparrow recently exited to Google. Considering that the Sparrow team was widely respected, the app had risen to popularity, and the team had raised a seed round from some notable investors, it seemed a somewhat disappointing result.

The team behind iOS development startup, AppCubby, recently penned a post talking about what it called “The Sparrow problem” and the challenges facing indie mobile developers.

Here’s an excerpt:

… Things have definitely changed and Sparrow is the proverbial canary in the coal mine. The age of selling software to users at a fixed, one-time price is coming to an end. It’s just not sustainable at the absurdly low prices users have come to expect. Sure, independent developers may scrap it out one app at a time, and some may even do quite well and be the exception to the rule, but I don’t think Sparrow would have sold-out if the team — and their investors — believed they could build a substantially profitable company on their own. The gold rush is well and truly over.

AppCubby’s conclusion, mixed with this news from W3i, points to the hard truth that, going forward, developers will likely have to consider new alternatives to marketing. W3i recommends that developers focus on designing apps for strong monetization to optimize their ability to compete, along with making paid buys during focused time windos to magnify chart rankings. And, since cost rises with volume in this market, there’s still hope for beating the average rates by producing titles in less-saturated areas.

Meanwhile, W3i said that, for the most part, social app discovery is still an unproven method for developers, with Facebook’s App Center still new to the market and Apple’s App Store becoming increasingly competitive. But social mechanics will become increasingly important going forward.

Iris Shoor also recently penned a post for TechCrunch talking about the approach she and her team took to marketing their app, and how they used non-traditional marketing tactics to get to 10 million downloads, including getting customer stories and testimonials and creating direct channels to their users.

W31 also noted that, like we saw from Fiksu’s analysis in December, the value of new users jumps even more during long weekends. Unsurprisingly, the company found that holiday weekends are high in advertiser demand, with rates increasing by 65 percent over the 2012 Memorial Day Weekend, for example, with some CPI rates even more than quadrupling the industry standard.

W3i: App Marketing Costs On The Rise, Jump 56% On iOS, 70% On Android Since January

Stay Focused And Keep Shipping: What Is Facebook Thinking With Its Phone Folly?


Earlier today, I wrote about Facebook designers asking, “What would you do if you weren’t afraid?”

Apparently, Facebook’s answer is “build a phone.”

First, Facebook announced that it was releasing its App Center in Brazil, France, Germany, Russia, Spain, Taiwan and Turkey, an expansion from exclusively English-speaking countries.

What does every good smartphone have? An app store.

Then, Bloomberg reported that Facebook is working with HTC to release a Facebook phone in mid-2013. If the report is correct, this will be Facebook’s first foray into hardware.

While a Facebook phone has been rumored for some time now, this is the first time we have heard a specific timeline for the release.

So, as has been asked many times, why is Facebook so hell bent on building its own phone?

Earlier this month, CEO Mark Zuckerberg said mobile was Facebook’s biggest challenge. But mobile and hardware are not the same thing. Yes, it’s absolutely a problem that Facebook makes very little money off its mobile site and app, especially given how much time people are spending on Facebook mobile.

But is the solution to build your own phone? Is that even a solution—or is it a loosely related, lateral product launch?

If Facebook’s push was purely mobile, they would be improving their mobile app, working on better mobile monetization plans and working with Apple and Google to be integrated into their operating systems.

Oh, wait. That’s exactly what they’re doing

Facebook relationship with Apple has never been better and it will be integrated into the next version of iOS. Facebook has a team of former Apple engineers working to improve its iOS app, and I’m sure they are working to better monetize their apps.

But by building a phone, they are going head to head with Apple and Google, fighting much more established products in untested waters, rather than collaborating.

And it’s a mistake. Facebook thinks it needs to do battle with Google and Apple in every theater. As more and more people switch to smartphones, the profit pie looks more attractive by the day.

But Jobs didn’t lead Apple into social for a reason (lol, Ping). Google hasn’t done that well, comparatively, with social. Twitter isn’t in hardware, presumably for a reason.

What’s Facebook’s end goal here? If it’s to topple the iPhone, I simply don’t see it happening. So the next most reasonable target must be to take some of Android’s market share. Not only will that be difficult for Facebook to do with their first iteration of a phone, but frankly, it’s beneath the social giant. Their resources are best spent elsewhere.

Yes, Facebook is currently reliant on Apple and Google for mobile. But it’s not a one way street–they’re co-dependent. Facebook has 900 million users; if Apple or Google were to restrict their app on their mobile devices, the other one or a third competitor could see many more customers who want Facebook mobile. It would cost Facebook far less time, energy and money to focus on top-notch apps that are well monetized than to build a phone. And it would succeed. That’s more than we can say about the unseen phone.

Facebook keeps shipping. But they need to stay focused.

Stay Focused And Keep Shipping: What Is Facebook Thinking With Its Phone Folly?

Why Facebook Is Still The Perfect Startup (Slides)

Facebook and mobile walled gardens

Facebook had another tough day today in the public markets, with shares now trading at around $28 after debuting less than two weeks ago at $42.05. Good timing, then, for a new slideshow report out today from the boutique French consulting firm faberNovel, which encourages us to look at the bigger picture, and why, in its words, Facebook is “the perfect startup.”

The mammoth slideshow (after the break) is an annual thing for faberNovel, which picks one company to tackle each year — others have included how Amazon controls e-commerce, how Apple dominates, and what could go wrong with Google. Like those before, the one out today on Facebook is a deep-dive into the company, and it looks not just at the origins of the social network, but what sets it apart from other attempts at global social networks — and other startups. (And by the way, faberNovel sees all this drama and attention on the IPO as just “one point on a startup trajectory.” Some investors may not feel quite the same.)

In 94 fairly packed slides (no Kreiger approach here), there is a huge amount of data, occasionally usefully visualizing some of the biggest challenges the company faces. (Example: Facebook’s monetization issue. It is getting ten times more traffic than YouTube, but only one-tenth the revenue of YouTube’s owner, Google.)

A little later, looking back at Facebook’s different tests with advertising, faberNovel makes a good argument for how a lack of success with more traditional models has contributed to it being such an innovative company. Specifically, around new, social ad formats (that’s slide 34), even if some of those formats have yet to pay off when compared to how much time users spend on the site.

“Facebook has no choice but to change the game’s rules,” faberNovel explains, which is perhaps the crux of why it has done so well.

What caught my attention the most — possibly because of all the news of the past week swirling around Facebook and its mobile plans — was faberNovel’s take on Facebook’s mobile business.

Facebook already has a huge amount of users on mobile (more than 400 million of its 901 million active users are accessing by mobile), but it could quite possibly get squeezed out of mobile altogether because of Apple and Google’s own control of the ecosystems, and the fact that eventually other and better mobile apps will come along.

That has left Facebook with no choice but to beef up with acquisitions, more features and its own beginnings of a mobile platform. Specifically, faberNovel believes the App Center could really become a game-changer and the lynchpin for how Facebook begins to “own” its users on mobile devices.

FaberNovel then takes this one step further and proclaims that, with its large mobile user base and variety of services, “Facebook is a new breed of telco.”

It even idly wonders if the company could, one day, even operate its own ad-hoc Mesh network to put the final piece into the puzzle. Is that a speculation too far? In a world of $100-billion-plus valuations for largely free services, perhaps anything is possible.

Why Facebook Is Still The Perfect Startup (Slides)