The Science Of App Marketing: How To Help Your App Stand Out And Find Its Audience

Tony Danova | July 22, 2013

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The Science Of App Marketing: How To Help Your App Stand Out And Find Its Audience

Tony Danova | July 22, 2013

The mobile app ecosystem has seen explosive growth as consumers flock to app stores linked to their mobile platforms and devices.

There's plenty of money in the app economy: ABI Research predicts that mobile app revenue will reach $46 billion by 2016, up from about $8.5 billion in 2011.

But app markets are also becoming incredibly competitive. That means many companies and app developers invest in apps only to see them lost in the "swamp" — the murky, messy, and cluttered app markets.

From a consumer perspective, app markets are difficult to navigate. App search is still primitive. App stores are still grasping for technologies that will put the most relevant apps within easy reach.

The best solution to ensuring your app has a good shot at a respectable rank, and that it remains visible in the app store is to know your way around app marketing and app store optimization, or ASO.

App Consumer Insights: It's important to understand how users approach app markets, what aspects of apps draw them in, and their use cases for these apps.

App Pricing: The price tag of apps has a marked effect on consumer demand and app store engagement. Free and freemium apps tend to draw in the lion's share of app downloads and revenue. Considering price is essential to securing strong visibility, sustained popularity, and continued user engagement.

App Marketing: It is also crucial to understand which app categories are garnering the most consumer attention, and also how different global mobile trends can affect your app's

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visibility in different countries. We also take a look at more specific techniques.

App Store Optimization, ASO: It's to app store search what search engine optimization (SEO) is to the Internet.

Internationalization And Localization: A local, translated version of your app can make a huge difference in your downloads in different countries.

App Install Ads: Facebook in particular has become a successful new ad platform for developers trying to drive mobile app installs through ads.

First, to get a better understanding of the market, we will take a look at trends in the overall app ecosystem.

A Dive Into The App Swamp

The threshold an app must reach for a coveted and lucrative top rank — and to rise from the bottom of the sludge — keeps creeping up.

App analytics company Distimo recently surveyed the performance of the top-ranked apps in the U.S. Apple iOS App Store for iPhone in May 2013:

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To reach a top 10 ranking, a free app needed 70,000 downloads. Paid apps required about 4,000 downloads.

Even a top 50 ranking required 23,000 downloads for free apps.

To reach the top 10 in terms of highest-grossing apps, a developer had to gross $47,000 in the month, and to break the top 50, the figure was $12,000 in revenue.

A top 50 ranking is clearly beneficial to companies or developers who want increased visibility.

But consider the $35,000 gap between the 50th place and 10th place in the revenue rankings. For every spot that an app moved up between those ranks, it drew an average of $875 more in the month.

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Another way to visualize the tremendous volume in app downloads, and how easy it is to get lost in the crowd: Data from app analytics company Fiksu shows that the top 200 free apps in the U.S. for Apple's App Store generated an average of 6 million daily downloads during May 2013. That's up from 4.5 million a year ago.

Leading the charge in mobile app market growth are Apple's iOS App Store and a host of Android app markets, spearheaded by Google Play.

Currently, there are close to 900,000 iOS apps available and almost 800,000 Android apps available on the Android markets.

The App Store figure is nearly double the amount of apps the market had available 2 years ago, while available Android apps grew from just 500,000 last year.

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App development is certainly at an all-time high, but it may not have even reached its peak.

Apps designed to promote a brand, product, or service may see a growth wave in the next year or two.

Nearly 50% of marketing agencies polled in a recent survey have used a mobile app in their campaigns or have plans to launch one in 2013 according to the Mobile Marketing Survey from Chief Marketer, a marketing consulting firm.

But, considering how expensive it is to develop an app for both iOS and Android, which app store drives the most downloads? Canalys surveyed global app stores across 50 countries in the first quarter of 2013 and found that Android app markets outperformed the iOS App Store in download terms, grabbing about 51% of total app downloads for the quarter, compared to 40% for iOS.

However, that does not mean that Android is the automatic go-to. Historically, iOS has been favored by developers because of its greater monetization track record.

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But developers have also been drawn by the sizeable volumes and the larger potential audience across Android app stores. This meant that many developers looked at iOS as a monetization play, and Android as an audience play.

However, recent data shows that app download volume may be more even than many developers may think. Android and iOS are nearly neck-and-neck, despite the much larger market share of Android-powered mobile devices.

Meanwhile, the monetization gap is not as wide as it once was. Android, helped by the strides made by the Google Play app store, has grown tremendously as an app revenue-generating engine.

It's drawing closer and closer with iOS.

The App Consumer

It's clear that consumer mobile consumption is growing. But on top of that, consumers are illustrating a growing preference for using apps instead of the mobile Web.

The growing app-centricity of mobile usage may be a disappointment to Web and HTML5 advocates, but it's borne out in the data.

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According to Compuware, about 85% of global mobile device owners surveyed stated that they prefer to use a mobile app instead of a mobile website when accessing the Internet on their mobile devices. The primary reasons cited were convenience, efficiency, and overall ease of use.

That dovetails with Nielsen data, which shows that U.S. smartphone consumers spend about 87% of their time on mobile apps, and only 13% on the mobile Web.

On top of this, Google Analytics also claims that consumers are now spending an average of 667 minutes per month using apps.

Growth in overall consumer app use is a good sign for app developers and app marketers.

To make sense of this data, it's important to understand app purchasing and downloading from the standpoint of an individual consumer.

How many apps are individual users downloading and launching?

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Flurry, an app analytics and advertising company, recently reported that the average number of apps launched daily by iOS and Android device users grew from 7.2 at the end of 2010 to almost 8 different apps daily per user by year-end 2012 (see chart above).

So, consumers are using apps more. That would seem to indicate that there's still headroom for per-capita app consumption to rise, and perhaps for more apps to make their way into consumer devices. The market hasn't peaked yet.

But that doesn't mean it's easy to nudge a consumer toward a new app download.

According to a separate Flurry study of a sample of 2.2 million devices, 37% of apps that consumers had on their phones in year-end 2012 were apps that consumers had on their phones a year earlier. That is up from 17% two years prior.

In other words, while there's room to grow, it's getting tougher to displace apps that have already found their way into consumer lives.

It's no longer enough to be the shiny new app in the store and get a few write-ups in the tech press.

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That's why app marketing has become an important trend.

App Marketing - Price

As with any consumer good, price may be the single biggest factor in determining how popular your app can become.

Flurry recently reported the average app price globally for the three largest app platforms.

Average prices for the iPhone, iPad, and Android app ecosystems were $0.19, $0.50, and $0.06, respectively.

That's a huge gap between iPhone and Android, and could be another implication as to why the monetization gap between the two platforms has held for so long.

Flurry also found that 9 out of 10 apps in the global Apple App Store are free. If Android apps are priced at only $.06 on average, that means there must be an even higher proportion of free apps on the Android platform.

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That could mean that either Android developers are simply grossing less revenue from their apps, or that they rely more on in-app purchases from free apps and advertising to monetize.

The likely truth is that all three dynamics are at work.

Debuting your app at a certain price, then ultimately dropping that price, may prove to be the best tactic, according to Distimo.

The app analytics firm analyzed the impact of price changes across the top 400 apps globally for iPhone and iPad in December 2012, tracking download and revenue numbers for up to seven days both before and after the price change.

In the Apple App Store, iPhone apps that dropped in price showed a 1,665% increase in download volume over the next five days (compared to the preceding five days). iPad apps showed a similar trend at 871% growth in download volume.

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Somewhat counterintuitively, Distimo found that price cuts actually led to a revenue increase, thanks to a volume effect. Meanwhile, a price increase led to decreased revenue — a more expensive app wasn't downloaded as often, so revenue dropped.

iPhone apps saw a 95% revenue jump in the three days after the price drop, while on iPad revenue climbed by an average 51%.

These are interesting results for companies looking to market an app.

Even minimal price changes can greatly increase your app's ability reach a top ranking.

The Apple App Store's recent five-year anniversary app giveaway, highlights the powerful effect of a "free" price tag.

The apps given away included How To Cook Everything, Infinity Blade II, and Tiny Wings HD.

Downloads soared. According to Distimo's daily charts, every app in the giveaway rose to a top 10 ranking in the Apple App Store.

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Of course, Apple's promotional strength and huge bullhorn helped, but the giveaway drives home the fact that consumers are attracted to free apps, as well as apps that recently dropped in price.

We can also look at a total app store revenue breakdown to see that free apps, especially "freemium" apps — which are free but sell extra services and features or performance tiers — drive the most revenue.

These apps are also a big driver of in-app commerce.

In-app purchases within free apps constituted 71% of total iPhone App Store revenue for February 2013, according to Distimo.

Since January 2012, the share of revenue made up by in-app purchases (in both free and paid apps) has grown from 53% to 76%.

When pricing an app for the App Store or Google Play, it's important to consider how consumers are not only gravitating to lower-priced apps, but how their activity within these apps helps drive revenue growth, and app popularity.

Based on this data, a smart strategy might be to debut at the lower end of the market in order to lure consumers in.

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If your app can't be free (particularly if you plan to never use advertising), leave yourself room for promotional price drops to drive download traffic.

Then, design your app to include multiple, convenient opportunities for in-app purchasing.

This structure will keep consumers engaged for extended periods of time, and can build up your app's overall user network as users — even those who don't make in-app purchases — help spread word-of-mouth buzz about your app.

Of course, for niche markets, a well-made app with a deep feature set can successfully command a much higher price tag than free or $.99.

App Marketing - Categories

It's worth looking at the top app categories for Google Play and iOS, since users sometimes browse through category pages for apps to download. Which are the most crowded categories?

In the U.S. iOS App Store, the top categories (based on the percentage of all iOS App Store apps) at the end of June were:

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Games Education Entertainment Lifestyle Business

Games have a clear advantage in the App Store over the rest of the categories, according to 148apps. At 17% of all apps, they claim a share of app inventory that is 7 percentage points higher than the next-largest category.

Furthermore, a recent study from mobile developer Dave Addey heightened the dominance of games in terms of App Store visibility.

Across all global app markets, games only constitute about 17% of the total apps available in Apple's App Store, but make up about 50% of all featured apps. (Featured apps are those that can be found on App Store homepages across markets.)

In the global Android market, the top categories (based on number of apps available) on July 7, 2013 were:

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Personalization Entertainment Books and Reference Lifestyle Tools

That personalization apps top the list across all Android markets is a testament to the platform's flexibility, since it allows consumers to customize their phones with non-native keyboards, theme templates, wallpaper aggregators, app launchers, et cetera.

You don't have to be an open-source hacker; even the most casual, novice users can adjust any and every aspect of their device's interface.

There is quite a bit of crossover in terms of popular categories.

Android's second-most popular app category is Entertainment, which is usually concentrated heavily with games. Books and Reference is analogous to Apple App Store's education category.

For apps that want to stand out from the crowd, they might select a less crowded category. For example, an iOS app to make creating grocery lists easy might choose the "Food and Drink" category, rather than the "Lifestyle" or "Productivity" category.

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App Marketing - Alternative App Stores

There are a number of benefits to featuring your app on a global scale.

But many markets have idiosyncrasies that make them difficult to target — like alternative app stores that force developers to think beyond the bounds of the two principal app stores, Google Play and iOS.

That's particularly true on the Android side (there's only one Apple App Store).

China, for example, is a huge opportunity, particularly for Android app publishers, but has nine main Android app stores.

That means it can be a bewildering market to navigate.

The One Platform Foundation states that there are about 36 total app stores planet-wide, most of them Android-focused and some of them centered in single markets, like China.

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Why is it worth trying to look beyond Google Play and getting to know these alternative Android app stores?

Because they drive significant app download volume. One China-based app store, Tencent App Gem, boasts nearly as many monthly downloads per app as the main Android app store, Google Play. (Downloads per app is calculated by taking the total number of apps in the store, and dividing by monthly downloads.)

Another app store, Anzhi, has about two-thirds the downloads per app.

Both of these Chinese app stores are much bigger than Amazon's main app store.

Plus, because some of the alternative app stores are smaller and aggressively curated, there's a very high chance of having your app featured or promoted by the platform operator.

A study from the One Platform Foundation shows that publishing your Android app across a variety of app markets can up your expected downloads by about 200%.

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App Marketing - Localization And

Internationalization

Perhaps one of the simplest techniques for upping overseas app downloads is location or internationalization, which basically involves reworking your app to fit into a local market, with the most obvious step — but far from the only only one — being to translate your app into the native language.

Doing so can have an extremely positive effect on an app's popularity in the local market.

Distimo surveyed 200 iPhone apps that had launched a native-language translation in August 2012.

The results showed that download volume increased 128% and revenues increased 26% in the week after translation.

Translation on its own may be the biggest factor in shooting your app up the market rankings, but it is only the first step in the localization and internationalization process.

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Proper localization also involves reformatting many characteristics of your app that may seem minimal, but may make all the difference in a specific market.

App localization service Applingua points out several characteristics to monitor:

Date and time formatting Currency conversion Number formatting Including local web links (e.g. www.apple.com/uk/ for the

U.K.) Local services (e.g. Twitter in U.K. but Weibo in China)

The end goal of app localization is to refine the user experience so that it's just as seamless for a user in China, or France as it is for a U.S.-based user.

App Marketing - ASO

The new big thing in app marketing is App Store Optimization, or ASO.

ASO is all about improving your app's chances at achieving high visibility.

The end-goal of ASO — and the growing crop of vendors that offer ASO services — is to help drive app traffic, achieve a high ranking, and enhance the visibility of your app in ways analogous to how SEO experts help websites drive traffic through search engines.

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ASO has come to dominate app marketing discussions because search is the biggest driver of discovery in app markets.

There are several factors that are typically optimized in an ASO effort:

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App name - Your app's name is always at the forefront of search within an app market. When choosing a name, most ASO specialists suggest including specific words to indicate the purpose of your app. Short app names may be detrimental.

Keywords - Like SEO, loading up on keywords in your app's description can help raise your app to the top of app market search results. Use words that help "trigger" app store algorithms. Some ASO specialists even suggest picking your keywords based on the most-searched terms on Google AdWords.

Icons And Screen Shots - These thumbnails provide a huge glimpse into your app's interface and functionality. They have a huge bearing on drawing consumers in. Essentially, you must think of icons and screen shots as a form of proprietary advertising.

Ratings and Reviews - High-ranking apps tend to be the most highly rated, and are also decorated with glowing user reviews. Maintaining a good standing with the app-using community can be make or break for your app's relevancy. ASO specialists recommend utilizing in-app messages that direct users toward an easy-to-use rating and review section.

Maintaining these characteristics will help tailor your app for greater app store exposure.

Another way to drive app store traffic, and to directly influence install rates, is through advertising.

Lately, app advertising has centered on app install advertisements, which are ad units that come with an "install" button baked-in that will direct users straight to the app's download center in an app market.

Most of the larger mobile ad platforms — including iAd, AdMob, Tapjoy and Flurry — offer app install-oriented ad products and tools.

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App Marketing - Facebook Mobile Install Ads

Facebook has lately been at the forefront of this advertising movement.

Facebook's mobile app install ads were first launched in October 2012 and have been steadily improving their performance.

Their cost, as measured by cost-per-impressions has also shot up.

According to data from AdParlor, click-through rates, which measure the percentage of users who clicked on an app install ad link, have grown from 0.45% in December 2012 to 1.86% in March 2013.

There may be a small drawback, though. Because click-through rates are going up, the ads are becoming more expensive. Cost-per-thousand-impressions or CPMs on Facebook mobile app install ads are almost $6 now.

Salesforce found the cost-per-install from a Facebook ad to be an average $1.37 for ads with a social component (telling you a friend had downloaded an app) and $1.10 for a standard mobile app install ad.

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Of course, cost-per-install is what ultimately will drive the success of the campaign, but the CPM rate is useful as an indication of how costly it is becoming to put these ads in front of a large audience.

(Facebook sells mobile app install ads on a cost-per-click or cost-per-impression basis, and advertisers must back out the cost-per-install.)

Facebook has also made several updates to this ad platform, mainly to increase efficiency and to help developers and marketers more easily achieve their goals.

It's interesting to compare Facebook ads' cost-per-install to what Fiksu feels is the average cost of acquiring a loyal app user, one who will open your app more than three times.

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That cost sat at about $1.33 for May 2013 and had fluctuated between $1.06 and $1.67 over the previous 12 months.

That said, the ROI on a Facebook mobile app install ad can prove to be generous despite its increasing cost.

Data from AdParlor claims that Facebook's mobile app install ads drove a total of 25 million new app installations for the first quarter of 2013.

These ads have also been successful for Facebook. These ads have helped Facebook drive in nearly 30% of their total mobile revenue.

Clearly, something is working.

We can also look at an individualized case study to prove app install ads' worth.

Ad tech company Nanigans worked directly with an app developer back in the early stages of Facebook's new app platform to market an existing app.

The results were extremely positive:

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In 10 days, the app moved from #253 in the iOS AppStore to #5.

Click-through rates average 0.74% and were as high as 1.50%. The campaign delivered 32.5 million ad impressions. Ad spend totaled $325,000.

Overall, the developer met his goal of maximizing app distribution while achieving a higher rank in the App Store.

But what happens after your app has achieved success? What are some ways to make sure your app stays at the top of the charts?

Candy Crush Saga, for example, has been a stalwart at the top of the iPhone and Android charts.

The game's developer, King, has made a concerted effort to stay atop the charts by focusing heavily on quality cross-platform gameplay.

Not only is Candy Crush Saga dominating the app market landscape, it's also pulling in the most desktop-based Facebook users of any app or game on the social network, with over 45 million monthly active users on that platform.

Facebook fans of Candy Crush Saga can quickly download the app to their mobile phone.

Facebook gamers and mobile app gamers can switch back and forth between Candy Crush Saga on their phones and Facebook on their PC to pick up their game on the level where they left off.

King even has a "play now" button for the game on its desktop website.

Now, King has taken app marketing to a new level. Candy Crush Saga has become the first app to run a stand-alone TV advertisement in the United States.

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THE BOTTOM LINE

The app economy continues to grow but is becoming more competitive each day. It's becoming much more difficult to achieve a top rank, so developers and publishers need to have a well-crafted strategy for standing out.

Consumers are showing app-first behavior on their mobile devices. They increasingly prefer apps over the mobile Web. They are also using more apps every day. However, they are increasingly turning to "old" apps, or apps that have been on their devices for a year or longer.

Price plays a big factor in drawing consumers in. Dropping the price of your app can result in a significant revenue and download boost.

App marketers seeking to maximize their app's visibility will likely see a positive return on investment from a combination of techniques. These include: app store optimization (ASO), localization, and smart use of mobile app install ads.

Alternative Android app stores also shouldn't be ignored.

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