Top App Monetisation Tactics

Last night we held our 2nd event for Mobile Marketing Meetup. We had 30 people attend (and 40 people register). We grew from the 15 that came to the first meetup. That’s 100% month on month growth! Regardless of the numbers, its really great to find other people working in the mobile space and equally passionate about mobile.

Top app monetisation tactics 

Marc Fine, head of marketing at InMobi gave a talk on “Top app monetisation tactics“. Its based on a webinar that inmobi did recently and the full presentation is here. I thought it was quite good to see what the leaders in this space are doing – Walmart, Zynga, etc.. The presentation was very relevant to me since I’ve been knee deep in metrics all week.My key takeaways are summarised below.

1. What is the value of your customer?

The formula is cost of acquisition < LTV. It might cost you $80 to get a customer but they could be worth $300 via in-app-purchases + ads, then the cost is worth it. The key is understanding the total value of that customer worth.

2. What are the key drivers for your business?

He spoke about metrics such as DAU (daily active users), MAU (monthly active users), ARPU, conversion rates, stickiness. These are the key drivers for Zynga who watch these numbers like a hawk. When they acquired Draw Something, it had DAU of 25 million. The problem was retention of those users which has since dropped to 8 million.

3. Segment your users

A more sophisticated way to do this is to segment your users by identifying patterns of behaviour and use rules to present them offers/ads/incentives.

Examples could be:

  • Segmenting your users in China and giving them a Chinese welcome message after 5 opens
  • US users may give you more of a viral uplift. So after they spend 300 hours, incentivise virality.
  • Identifying hardcore users and treating them like your VIP’s and giving them more things to buy

Its about understanding the consumer behaviour and adapting the experience for them. This is where the web was moving towards when I was working at Next Digital. In the last few years, I’ve been hearing more about personalisation, real time, dynamic content, and click streams. We see it already with companies like Amazon, who understand your behaviour and what similar people do. They “chase” you through the website and with followup offers.

3. ARM cycle – Acquisition, Retention and Monetisation.

Its understanding the cycle of that customer. How you get them in the door, how to keep them coming back and how to make money from them. It make sense but its hard to do.

I spoke to Dan and Joe from rushfaster.com.au and they said its a similar principle to what they do for their eCommerce business. Understanding how the customer churns through the cycle and the throughput. I’ve also come across Dave McClure’s AARRR metrics presentation again and it has a similar idea – Acquisition, Activation, Retention, Referral and Revenue.

AARRR metrics

What game companies are doing

I also spoke to Matt Farnell from Appsperse, a mobile ad analytics company based in the Valley a few weeks ago.  They’re currently working with Super Cell on “Clash of The Clans” which is estimated to be doing $700k per day in revenue. He told me that game companies will test out their game in a small Western market, optimise it and then start pumping money into it to advertise it. After it gets high in the app charts from paid advertising, then scale back advertising as the organic downloads come through.

For these techniques to be really interesting, you generally need to have millions of impressions/users to understand the data and create all these rules. At Zynga they have data analysts, customer acquisition teams and tons of data to use. However, Matt believes that startups can replicate some of these techniques that larger game companies are using and use some of the same tools as well.

Bonus – Buzzy.io demo

We had a bonus demo from Mike Gardiner of Buzzy.io. Buzzy is a multi-player, multi-screen game platform. It turns your mobile device into a game controller and you can play it on another screen, against other people. You have to watch the demo to fully appreciate how it works. They’re currently looking for game developers to build games on their platform. It can be used at music festivals, cafes, outdoor events, pubs.

Future

We will take a break over Christmas. We’re looking at holding the next event at the end of January and will most likely talk about “mobile metrics”. I’d like to have a case study with some in-depth analysis as a follow on to this talk. If you know of anyone that may be a good speaker particularly from a startup perspective, please get in touch with me via the contact section of my website.

I’m out like single player games,

Matt Ho