Mobile App User Quality: The Industry’s New Passion

12/27/16

For many years, mobile app marketing operated as a Wild West – one in which the tactics were many and the rules few. More than 1,000 ad networks and other media vendors formed to serve the industry, with many promising massive install counts at rock bottom costs-per-install (CPI). Many are the sort of vendors that might say, ‘ask me no questions and I’ll give you more installs than you can count.’

As a big player in the mobile measurement industry, our company Apsalar has unique visibility into the consequences. And what we see from most of these cheapie installs isn’t pretty. Very few of these cheap users ever regularly use the apps, and fewer still make the purchases that these businesses hope to rake in from their multitudes of installers.

Despite these poor results, cheap installs have remained the currency of the app business. Until the last 12-18 months, when things suddenly changed. That change is the result of a massive shift in marketer priorities.

In a recent survey of enterprise app marketers, 84% said their KPIs are now primarily focused on mobile app revenue (from estores or the app stores rather than installs. When revenue is your focus, you begin to care more about user quality than raw user counts. In fact, 78% of the marketers we surveyed said that they cared more about user quality now than a year ago.

Here are 5 ways that a focus on user quality is changing app marketing.

Media Consolidation to High-Quality App User Providers: Across the app industry we’re seeing more and more of the media dollars flowing to leading providers with the technology and standards necessary to deliver better quality installs. Across our footprint of more than 40,000 apps, we’re seeing the top ten media vendors take 40% more of media dollars than 18 months ago. The second ten are now taking 20% more. The losers are the hundreds of small networks and media sources that have more difficulty proving that they drive high-quality installs. Suffering most are the companies that offer what are called incentivized installs – where the user is rewarded with things like gold for a mobile game if they download another app.

Shift to Cost per Action Media Buying Models: Traditionally, most app media was purchased on a cost-per-install basis. That means that a media company was paid based on the total number of installs that they drove for an application provider or publisher. Now many mobile app media contracts are based on what the industry calls a cost per acquisition basis. That means that instead of paying for every Android and iOS app install, brands pay only for mobile app users that take a step beyond installation – something like registering or making a first purchase.

Aggressive Post-Install Mobile App Marketing: Many app marketers are waking up to the idea that great app users aren’t just born – they are also made. Data show that unless app marketers proactively engage new users with messages like push notifications and retargeting ads, an app can lose 95% or more of its daily active users (DAUs). We’re seeing big shifts in marketing toward post-install engagement. Post-install’s share of marketing spend has grown more than three-fold in the past year.

Investing in User Analytics and User Experience Research: Years ago, marketers didn’t pay much attention to what users did inside apps. Because their objectives were app-install-centric, they spent virtually all of their time on mobile app user acquisition. Now they are aggressively investing in mobile app user analytics and business intelligence tools to uncover the patterns and paths users take. By analyzing this data, marketers hope to better understand their best customers and how to drive incremental revenue.

Growing Resolve to Address App Fraud, Especially In-App Purchase (IAP) and Mobile App Install Fraud: When Android, iOS and Windows app marketers were compensated primarily based on iOS and Android app install counts, there was little interest in addressing install and other forms of fraud that have grown all too common in our industry. But now app marketers are analyzing their users and installs to spot likely sources of fraud. For example, looking for data that indicate “installs” from device emulators or hijacked mobile devices. Some of the data used to spot potential sources of fraud include app retention rates, uninstall rates, and temporal install patterns.

These are just a few of the ways that app marketers and mobile app marketing strategy are changing in our industry. And how app user quality is taking center stage in most marketing programs.

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