Private & Confidential I 2011 1

The Hitchhiker's Guide to the World

of App Monetization

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Industry’s Main

Concepts

Terms and Buzz Words

Private & Confidential I 2011

In-App Payments

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“I refuse to answer that question on

the grounds that I don't know the

answer” D. Adams

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Download the app for free NOW and pay later through a variety of revenue models:

- “Try and buy”- Virtual goods- Subscription model

In-App Payment

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Fact! 35% of the 300 top-selling free games use some sort of

virtual currency as a form of payment in the App Store 49% of all iPhone-related revenue is derived from in-app

purchases

(As of June 2011; Source: Distimo)

In-App Payment

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When purchasing a mobile app, the user must choose from the following payment alternatives:

iOS iTunes account

Android: Carrier Billing PayPal Google Checkout Credit Card

Payment Methods

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Fact! The “Carrier-Billing” payment method is likely to generate payment 10 times more than any other method.

Payment Methods

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The final net payment to the developer (after the middle-men take their cuts) is different in every geo-territory

Apple’s App Store – 30% - 70% Android App Market – 30% - 70% PayPal – 3.4% +€0.35 Carriers:

Payouts

Country /

Price level

#1 #2 #3 #4 #5

Price Payout (exc. VAT)

Price Payout (exc. VAT)

Price Payout (exc. VAT)

Price Payout (exc. VAT)

Price Payout (exc. VAT)

Canada (CAD) 2.00 53% 2.00 53% 2.50 54% 2.50 54% 3.00 44%

China (CNY) 2.00 43% 2.00 43% 2.00 43% 2.00 43% 2.00 43%

France (EUR) 0.35 50% 0.50 50% 1.50 50% 3.00 50% 6.00 50%

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Fact! In most cases, the net payout from the carriers will be

between 40%-60% of the price.

Payouts

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Alternative Payments- “I really wish I'd listened to what my mother told me when I was young."- "Why, what did she tell you?"- "I don't know, I didn't listen.“

D. Adams

Private & Confidential I 2011

“Alternative Payment”

You! Your user!

In-App Item

Money…

Standard payment:

Alternative payment

You! Your user!

An advertiser!

Free In-App Item

ActionMoney…

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Action:- Incentivized download (TBD)- Submit your mail- Watch a video- Vote- “Like” (Facebook)

Fact! The developer’s cut is usually 70% of the amount paid by the advertiser

Alternative Payment

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Incentivized Downloads

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You! Your user!

Game coins

Another developer

Pay for the item

Download, install and open

Cash Free content

Better ranking

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Fact! At its peak, Tapjoy generated income of $8M monthly from

incentivized downloads While Apple clamped down on incentivized app downloads,

this option it still available on Android devices 

Incentivized Downloads

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Advertisement“Who said anything about panicking? This is still just the culture shock. You wait till I've settled down into the situation and found my bearings. Then I'll start panicking.”

D. Adams

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CPC / CPA / CPL / CPI and More

CPC - Cost-per-Click (only if necessary)

CPI - Cost-per-Install

CPA - Cost-per-Action (install, register, use)

CPL – Cost-per-Lead (mail submission)

Fill rate - The percentage of ad requests that are filled with

ads

(when an ad is displayed to the end user)

Fact! The fill rates of most ad networks range between 50%-60%

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How can you monetize your app?

You can define paid In-App items You can add an ad banner You can add offers

Contextual offers that 3rd parties are willing to pay for

Offer Wall

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Lunkwill: Do you... Deep Thought: Have an answer for you? Yes. But you're not going to like it. Fook: Please tell us. We must know! Deep Thought: Okay. The answer to the ultimate question of life, the universe, and everything is...

Deep Thought: 42.

The Ultimate Fact!

Private & Confidential I 2011

LogiaPay- The market’s most comprehensive in-app payment solution offering every available payment method

LogiaReach – Upload your app to the stores of various 1st tier mobile operators using our existing relationships

LogiaAd – Use Logia’s optimized ad-network solution to increase revenues from your advertising space

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For those of you who are not satisfied with this answer, Logia can offer a more practical one –> A set of monetization tools for maximizing your revenues:

Private & Confidential I 2011

Thank You!