AURELIE: My name is Aurelie Guerrieri and the founder of Akila One, a Growth Consultancy helping mobile startups scale. I’m the author of The Mobile Native’s Guide to Marketing, published by App Annie, and the creator of the podcast series, “Growth Hacking is Dead, Long Live Growth Marketing.” Today, as part of this series, I speak with Danielle Levitas, Senior Vice President, Research and Professional Services at App Annie. Danielle, thank you for joining us.
DANIELLE: Thank you for having me, Aurelie.
AURELIE: In a few words, can you tell us how you got your start in the mobile world, and what specifically convinced you to join App Annie?
DANIELLE: I’ve been a market analyst and a consultant throughout my career, and mobile was a technology that I’ve gravitated towards since 2000: the days of companies like Nokia, SMS, Motorola and their flip phone, from the candy bar phones of Nokia to the Blackberry domination that we saw well before the launch of smart phones and app stores and so forth. It’s been in my professional blood for a good 17 years now. I joined App Annie after having the opportunity to collaborate with the team on some work while I was an analyst, when I lead the mobile team at a company called IDC. Long story short, over the course of a couple of years, I got to know the company, became close with the leadership, then the right opportunity opened up and the rest is history.
AURELIE: Very interesting. Candy bar phones, I haven’t seen one of those in a long time!
DANIELLE: And they dominated!
AURELIE: Yes, they’re like dinosaurs today, now extinct. You’ve long been an advocate of leveraging data to understand consumer behavior. What are some specific ways in which companies can turn data analytics into meaningful business ideas?
DANIELLE: I think we’ve increasingly been in this world of using data to inform decisions. While there’s clearly expertise, experience, and some level of people’s innate sense of direction, the fact of the matter is that data has become more critical throughout organizations. Today marketers are controlling more and more of overall IT spend, not just the types of data and services that are needed to drive an organization’s growth. We see some really critical aspects of this, as it relates to mobile, really starting to have a market difference. It’s not just a company’s digital or marketing strategy for “mobile”, but how mobile is now really starting to transform the core business, even for businesses that don’t consider themselves mobile first.
More specifically, if you think about mobile, at an initial strategic stage, think about whether it’s banks, traditional retail companies, or hospitality companies where mobile is just perhaps one more channel. But they need data to understand the planning stages. So, what does the market look like? What’s the competitive landscape? What is the opportunity to drive new types of engagement with customers and new customers? What are the demographic differences? How do they use mobile differently? So it’s using real deep data to understand different geographies, different demographics, etc. to plan. Do they partner, do they buy, do they build? Then that next stage would be around acquisition. How do you then acquire users once you’ve set forth your strategy and who you’re going after? There’s a multitude of ways to acquire users from organic ways, through things like App Store optimization, and even the creatives that you use, to thinking about, obviously, paying ways to drive installs.
And then, after you acquire users, how does the data feed into how you keep them engaged? That’s critical. What do you need to do to get them to come back on D 1, 3, 7, 14, 30, for example? How are you benchmarking versus best in class, or competitors? Or it could be market adjacencies that you can learn from. Is it about sessions per user, for your industry? Is it about time per user, for your industry? As well as, obviously, the number of active users. We all know AB testing is critical but you can’t AB test everything; it could be incredibly expensive. So you can use data to learn from the mistakes or the successes of others in the industry.
The last part of the cycle, where data is really critical and what we work on with companies is monetization and return on investment. For some companies, it might be about direct monetization through app stores, in app purchases, subscriptions, and so forth. For others it’s about advertising-based revenue, or potentially a combination of those. And for others it’s about driving transactional revenue, i.e., getting somebody to order that ride, to purchase that flight, to purchase that consumer product. For many others, it’s about lowering service costs, delighting your customers, and just really being this critical channel that allows you to meet your customer whenever and wherever they need you.
AURELIE: I want to go back to that point of using data to learn from the successes and mistakes of others. We have a lot of people in our podcast who are growth marketers, and they’re dying to hear from you about this, because you have a global view of what everyone is doing. So from your observations, what are the top growth strategies that best in class app marketers use?
DANIELLE: I’m still incredibly surprised when I meet with companies, or when I’m at an event and I’ll do quick show of hands, how few people in the mobile space and digital marketing have an app strategy. They don’t know what app store optimization is, and if they do, they feel like they don’t do it well. ASO is still surprisingly new for so many companies. For those listeners who are not as familiar, think of ASO akin to SEO, search engine optimization, for helping companies like Google be able to better index your site, for example. It’s very similar. You need to be able to have your app be more discoverable. We all know there’s two plus million apps in Google Play and two plus million apps in the Apple App Store. One of the critical things we’ve seen the best-in-class publishers, marketers, etc., do is leverage ASO. So what does that mean? It means using data to understand how competitive the keywords are for discoverability of your app. It’s using ASO to literally change the title of your app. Do you need an extra little descriptor after the name? We’ve seen companies that have more seasonal businesses (retail is a fantastic example here) change the name of their app as well as the description, the app icon, ahead of Black Friday in the US, or Single’s Day in China, and when they do an app update, redo these ASO aspects so there is a new title, descriptions, and a new icon. They will see significant improvement in terms of discoverability, in terms of returning at a higher ranking, if you will, when a consumer is looking for a certain type of app or a certain feature function. ASO is in many ways so under-leveraged from a growth standpoint today.
AURELIE: Interesting. So are these people looking at the competitive landscape and trying to differentiate, or come up with new ideas? Are you seeing some of that cross-industry pollination, are people using competitive information?
DANIELLE: I think the stronger marketers are the ones who hire really strong folks to run their business from a product standpoint, because it’s not just about marketing. A lot of times those product leads can be really critical in driving success here. For example, you might want to do a soft launch in a market that looks similar to your core market. US is obviously a very large market, in terms of the sheer number of mobile consumers and number of dollars. But we will see, for example, soft launches in a geography like Australia as a way to test because some of the behaviors are similar and there’s ways to learn from that.
We’ve seen other companies be really smart in terms of looking at market adjacencies and seeing what feature functions were introduced by a company. Let’s say a certain mobile payment is being integrated by a quick serve restaurant or retailer, and it correlates to improvement in either number of active users, number of sessions in a month (or a week depending on the kind of app), or the time spent per user. So you can use the learnings from other apps that have introduced certain features, that would be really expensive for you to bet on too early, to see how it might fundamentally change the overall level of usage of a company’s app. For some apps you can then start to look at whether it did actually pull through revenue directly.
AURELIE: It looks like you’ve read my book Danielle, you’re pulling from some of the same topics that we cover: ASO, Launching a Secondary Geography. That book is published with App Annie. I’m very happy with this collaboration, because we have a lot of content that’s very relevant in helping app marketers think about the world and their mobile strategy.
I want to go back to some of the pitfalls, based on your observations of the marketing landscape. One of my pet peeves, and the reason behind the series, is I hear the word ‘hacking’ a lot. People think that there’s a magic solution somewhere, a magic channel that nobody knows about, and if you were to stumble upon it you would shoot through the rankings and be successful. It’s not something that my experience has proven. The marketing I’ve seen is a lot more boring in a way, much more strategic and based more on processes and tools. What are some mobile marketing pitfalls that you’ve seen, based on the data you’ve looked at?
DANIELLE: I think some of the pitfalls, which in many ways are potentially the most avoidable, is for companies, maybe newer or less sophisticated, that are just going for app installs. We see this a lot, especially with either a new app from a publisher that is less experienced, or a company that has had an app, but it’s fledgling and they’re trying to reinvigorate it. What we see is this focus on installs, and so it may or may not be sophisticated enough to really think through what should the CPI look like, if I’m going that route of just driving installs. What we often see is when companies or publishers are just going solely for those downloads, what ends up happening is that the user won’t necessarily show up after that. It goes back to the retention, what happens on those D3, 7 and so forth.
A couple of things I would mention; one is, it’s not just about the installs. You want to work with more sophisticated partners if you’re going down the paid route only, or paid in addition to organic (I touched on ASO before), to ensure that you understand how well they can target the users that they’re bringing in. When we work with our customers, we have this tool that allows you to do cross app usage. Let’s say there’s a certain type of demographic you’re going for, or your app has certain features or functions of an existing app that’s seeing some success. What you can do with this tool is literally look at the other apps that users of a similar app use a lot. And then you can better target those new users, or at least meet them where they are in these other apps. Then at least you have a higher probability of getting someone who fits the demographic of not only installing your app, but using it going forward so you can monetize them. So that’s one of the pitfalls, I think when you’re going for simply cost, or simply installs, and not thinking about the targeting in a way that’s sophisticated enough. Also, make sure you don’t underinvest in the “free side”, on how you’re naming your app, describing your app, the icon of your app, etc. All of those things are easy to AB test for, on the latter part.
AURELIE: Absolutely. Target, think about the right kind of user, and think about how they discover your app. I always love hearing your predictions. What do you think mobile marketing will look like in the next two years?
DANIELLE: I think there’s 2 key things. One is the fact that, to date in the mobile space, we’ve seen so much of what’s happening in mobile marketing defined by the more mature and sophisticated mobile verticals. And I put game publishers at the heart of this. Of course, there’s also media and entertainment and news and so forth. What I’m really excited about, and what I expect to see over the next couple of years, is continued maturity and sophistication by brands. Today it’s so much about performance marketing, it’s about getting that install, or maybe even reengagement. I think over the next two years we’re going to see these big brands starting to really understand the power of apps. Globally we are spending on average two hours a day in apps. That’s a month per year out of our lives. That is the power of apps; and as these big brands, these verticals that predate mobile, let alone apps, really start to understand this and embrace this, it is going to redefine digital marketing over the next two years.
The second piece is from a format standpoint: video has already become that dominant, more engaging format. We’re seeing rewarded video being incredibly successful, and that’s a very new type of tool – basically make someone watch something and earn points in exchange. It’s been incredibly successful for publishers. Ultimately we’re projecting a 30% growth in terms of spend in mobile marketing. Specifically in in-app marketing from this year to next, this market globally in terms of spend will surpass the 130 billion dollar mark. That’s what we’re talking about from a growth standpoint. This is where the focus, the dollars, the innovation is, and where I expect to increasingly be over the next 1-2 years.
AURELIE: I’m fascinated by your data points about rewarded video. Are you seeing it work besides the gaming vertical?
DANIELLE: It’s primarily in games, but even in news media you’ll see it there. When you couple it with something like native ads, where you’re promoting some meaningful content that could be on sister sites, or in the case of entertainment, upcoming TV shows, etc. I think it’s still in that early stage, not unlike apps in general and apps for monetization and advertising and video and so forth. Game publishers have led the way even before mobile. Think about HD, surround sound audio…Even if you’re not gaming and you think it’s really different, I would urge marketers and innovators to keep an eye on that space because it’s typically ahead of where your industry will ultimately need to be.
AURELIE: Absolutely, and it’s a huge budget so they get to test a lot of things for you.
AURELIE: If you had a magic wand and could change one thing in growth marketing, what would that be?
DANIELLE: I think if I could change one thing, it would be to wake up the CMOs, CDOs or even CEOs at companies that have consumers as customers or who can build relationships through consumers, even if they’re B2B. There are so many times we go into these high level discussions with these companies that don’t see themselves as mobile first, or don’t see mobile yet as a primary channel. In some cases, not even a secondary channel; and they have yet to understand how transformative this channel can be. That two hour stat I gave you, it comes back to you. This is an opportunity to meet your customers whenever, wherever they need you. Consumers on average across the globe are using over 30 apps per month. In the US it’s 35 apps per month, 11 apps per day. This is the power of apps. We’re still downloading, even in immature markets, 5 or 6 apps per month. This is a critical channel to meet your customers, to engage, to transform, and to capture new customers. They need to wake up, and that’s how I would use my wand.
AURELIE: Thank you so much for your time, Danielle – lovely talking to you.
DANIELLE: My pleasure Aurelie, thank you for having me.
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