PHOENIX APP LABS

Enterprises are adopting mobile devices more quickly than ever. According to a recent Gartner CIO study, Mobile has gone from the #3 area of focus in 2014 to the #2 CIO priority in 2015. While mobile is bringing huge opportunities to enterprise applications, it also brings new challenges. One of these challenges is safety, particularly in industrial environments where workers must be focused on their immediate surroundings and often wear cumbersome safety gear that can interfere with use of a mobile device.

A newly conceived mobile interaction concept presented at MobileHCI (Human-Computer Interaction) 2012 offers a way to make mobile applications more accessible to industrial workers while reducing the risk of injury caused by inattention or removal of safety gear.

The concept, called Body-Centric Interaction (BCI), envisions a set of mobile interactions centered around the user’s body. Rather than having to focus on the screen to interact, the user is able to perform simple movements to trigger specific actions. For example, users can touch a device to their wrist, shoulder, pocket, or knee. The can also move the device away from them or towards them in specific directions to interact. These interactions could be easily performed by a worker checking quality on an assembly line, for example, without having to type, remove their gloves, or defocus from their immediate environment.

BCI could also be used by managers timing or coaching employees on factory processes. They could keep a close eye on the work being done, and record data easily without having to look down at a screen–and potentially miss an important moment.

While this interaction method is not yet available as a standard, we believe it could adapted with current sensor technology. Whether you’re building mobile applications for industrial workers or line managers, thinking “outside the screen” when you consider how users could better interact with your app will open up new ways to solve some of the challenges that come with introducing mobile devices into enterprise.

Watch grad student Xiang ‘Anthony’ Chen demo his concept here: Body-Centric Interaction with Mobile Devices

Continuing our series of articles on free vs. paid apps, this post covers the main questions you should ask yourself when deciding on your app monetization model. If you’re feeling a little lost, these 5 questions will guide you through evaluating the different strategies, help you hone in on key details, and draw your attention to important factors which might not be on your radar…yet.
App revenue inevitably varies, and it can largely depend on the volume of free and paid apps in the different categories. For example, apps in the popular social networking category generate more downloads than apps in the less popular productivity category. Additionally, the number of paid apps is greater in the productivity category than the more light-hearted social networking category.

This week as we delve more deeply into the details of pricing and profitably to maximize your app’s success in the hands of users and the app stores.

To see which app strategy (free or paid) is the better fit for you, this post addresses how monetization differs between the App Store and Google Play – including how industry trends play out between the two.

Sources: App Store data 148Apps.biz, Google Play data AndroLib.

Industry trends in general show that free wins over paid in both the number of apps with the model and the revenue they generate.

1. Over 80% of apps on both the App Store and Google Play are free

2. Over 90% of app revenue is driven by free apps (money is made through in-app purchases, advertising and premium features)

3. From 2012 to 2013, overall app revenue from free apps increased by 211% while revenue from paid apps decreased by 29%.

4. Revenue from in-app advertising grew by 56% from 2012 to 2013.

Source: App Annie & IDC Mobile Advertising and Monetization Trends 2012-2017

Additionally, as this chart by Distimo shows, the free app model rules in most app categories on the App Store. However, Productivity, Education and Navigation apps have more paid than free apps.
When Paid Apps Are the Exception

Based on the above industry trends, free apps (with in-app purchases or advertisements) are usually the best monetization approach. But, there can be a few exceptions where a paid app is preferable and more profitable than a free app. If your app has niche functionality and is offered to a specific set of people, then it would be suitable to offer it as a paid download. An example of this would be an app which caters to doctors and helps them with treatments.

Going with the paid app model means you need to analyze the correct value of your app. To do this, take a look at the functionality and pricing of other apps in your industry to correctly identify the real value of your app.
App Price Distribution on the App Store

About 90% of paid apps on the App Store are in the price range of $0.99 to $4.99


Source: App Store data taken from 148Apps.biz

When it comes to average app prices, this graph shows that Android apps are the cheapest while iPad apps are the most expensive.

More than 20 apps in Phoenix App Labs’ portfolio have hit the Top 10 in their categories or cracked the overall Top 200. In this post, Phoenix App Labs’ CEO, Kumar Vivek, will share the secrets to creating and monetizing apps in today’s mobile ecosystem.

The Idea: Where is The Money?: The first step in developing any app is determining where the money going to come in from once it’s launched. Apps can be paid, subscription, freemium, shareware or ad-enabled. Thinking of monetization first will help drive a design that can bring a return later.

Kumar espouses the 5-5-3 test. An app is most likely to be a monetary success if a user can realistically be expected to use it at least 5 times a day, for at least five minutes per use, and will keep the app for at least 3 months. Yes, there examples of successful apps that don’t pass 5-5-3 test, but why not give yourself the best possible chance from the start?

Kumar also believes that freemium is generally the best monetization model, particularly for newer developers. It’s much more difficult to get paid apps to market and ranked in the App Store because the friction to acquire a new customer is much higher, and the snowball effect that drives many free apps to the top is much less pronounced for paid apps. If you have the budget to spend $100,000 to properly market a free app there’s a very good chance it will get to the Top 200 in the App Store, but the same doesn’t always hold true with paid apps.

Addiction and Problem Solving: Once you’ve set the yardstick for your app with the 5-5-3 test you’ll need to create what Kumar calls, “addiction factors” that will ensure that your app passes the test once it’s launch. You’ll also need to create in-app purchases like virtual goods, new levels, or extra features. With the power of repeat in-app purchases you can earn $100 or more from a single download– versus $29.95 for traditional paid desktop app purchase.

Once the app is established and successful, rather than new features you should focus on improving functionality. That will keep users rating the app highly and coming back to use it again. When your user base is large enough, adding more in-app consumables that enhance the customer experience will drive significant revenue.

Solving Problems: While solving an old problem in a new way with an app can be a viable path to success, it’s important to ask yourself how large is your potential user base is. If you are solve a real problem that many people are having it’s much easier to reach a Top 10 ranking on the App Store. But it’s important to be honest with yourself and not over-estimate the market just because the app solves a problem for you. If the audience is niche, you can still grow a user base because you’ll have fewer competitors and a targeted market. But if your app solves a universal problem, mass adoption is possible, and massive success is much more likely.

Execution and Focus on UX:If an app doesn’t deliver an outstanding user experience it’s highly unlikely to succeed in today’s competitive app market. It’s important to use natural gestures for natural interaction with your app so users don’t need any instruction to use or navigate the app. It’s also key to make the app responsive to the platform it is developed for. Take advantage of the nuances of that platform and get everything you can out of the fact that you’re developing natively.

Rather than giving users multiple options, Kumar suggests that you drive the user experience based on your own expert vision. While it’s important to pay attention to user ratings, don’t let a handful of people who complain about (or praise) your app drive everything. If you change things based solely on a small percentage of people who voice their opinion you may actually lose the loyal majority who is happy using your app, but just silent.

The Team: If you’re building your own mobile team rather than outsourcing, don’t focus on hiring “rock star” app developers. You’ll get better results with someone who is passionate about your project and supports your unique vision. One of the best developers Kumar has ever hired dropped out of college and didn’t have the traditional credentials, but as Kumar says, “you could see the passion in his eyes.”

Keeping Costs Down: If you’re building the app yourself, you can keep your costs lower by using SDKs and pre-built components.

Getting Ready for Launch: It’s crucial to capture analytics on how the user interacts with your app, so make sure you’re using an analytics tool so you can measure everything.

Start preparing your social engagement. While Twitter and Facebook are a good start, if your app is in the right genre consider channels like LinkedIn or Pinterest as well. A well run launch campaign will include email as well as device notifications where you ask the user to rate the app and provide incentives to do it. You won’t have this luxury the first time around, but if you capture emails in your first app and have a moderate success, you will have a much easier path to making your second app a hit. According to Kumar, an email user list of 100,000 users will take your app to Top 200 easily, so it is extremely important to build your list with your first app.

Marketing: Viral, Video, and Screenshots: Before launch you’ll want to use niche forums including Reddit, Touch Arcade, and tech sites such as TechCrunch, Mashable, and ReadWrite Web to build the apps’ popularity.

Kumar suggests sending these sites an announcement from you personally with a subject like, “Exculsively for you from xxxx – the app name and its usability.” A professional video of your app will more than pay for itself in increased virality and downloads. Make sure your screen shots are as good as possible for the App Store. Screenshots are one of the most important pieces of your marketing and should be taken care of early. If you’re fortunate enough to have Apple feature your app, they may request screenshots be sent within 48 hours. If you’re not ready, you’ll regret it later.

Launch Day: The launch day is crucial, and timing is everything. Friday evenings are good and give you a full weekend when people are more likely to be downloading apps. Make sure you’re ready for a potential App Store feature with those screenshots you already prepared.

To help spread the word, give out free goodies to your base of friends and family to get things rolling. It’s also key to reply quickly to emails you get the few days and encourage those users to talk about you by offering them something special. This builds a strong user base and recommendation network, and is the start of your fan base. Make sure you capture your fan base details in a database so you can use that information to promote your next app.

Advertising: Unless you have a large existing e-mail list or an extraordinarily viral app, you’ll need to push initial adoption with an ad campaign. The first week is the key, and you’ll want to use your entire ad budget in the initial 7 days, with a significant portion going to day one. You’re pushing hard to get maximum velocity on the first day. For the vast majority of apps getting a top 200 will happen in 48 hours if it’s ever going to happen. If you try to iterate, pivot, or spend your ad dollars later, you will lose that very limited window to rank.

Ad Types: The type of ad you use will determine your user acquisition. Media vendors offer click-based, install-based, and impression-based ads. Your best bet is install-based ads, where it takes $0.5 to $1.5 to acquire user for a typical free app. You can also incentivize installations of your app by offering goodies. Using both incentivized ad networks (TapJoy, Flurry) and non-incentivized ad networks will give you a well-rounded user base. It’s important to plan ahead to ensure that you have an adequate ad budget. Most apps that crack the Top 200 invest substantially and blast all their guns at the right time.

It’s also key to reach out to popular blogs to feature your app. To approach them, think about why you’d care about your app if you were one of their readers and position your story from that perspective. Blog mentions are doubly valuable because they drive installs and you can use quotes from them on your App Store page.

Analyze: It’s important to use Flurry or a similar tool to analyze your data. You’re looking for the same 5-5-3 components you set as your initial goals. Look at user frequency, usage time, and retention. It’s also key to send updates to your users regularly.

Watch Your Ratings: Blog posts and guest posts help significantly as they influence user ratings. If you find a rating that is clearly malicious, report it to Apple. Kumar once found a comment for one of his apps that said, “no one has given your one star, and I am giving it.” When that caused the app to drop from 5 stars to 4.5, Kumar reported it and Apple removed the review in under two hours–preserving the 5 star rating.

What to Do If It Doesn’t Work: In Kumar's experience, if your app doesn’t succeed, it’s generally not worth iterating to improve your ratings. Instead, accept failure and make a major pivot to improve.

Nowadays, there’s a vast and seemingly-endless influx of data available to you, where you can monitor metrics like exit rates, bounce rates, page views, new users, and returning users, from a myriad of sources. It’s no wonder many people can feel overwhelmed or frustrated when integrating data into their company’s development process. But by avoiding the complexities of analytics, you’re missing out on the advantages it can give you.

You’ve got a brilliant app idea, but you might be clueless where to go from there. When it’s time to get your mobile application built, companies have two choices:

Recruit and hire an internal team.

OR

Find a mobile development company.

While building your own team may appeal to you (since your app is your baby, after all, and you want it to be perfect) there are several issues with creating an internal team. For example, when you’re searching for the right candidate, recruiting can take a long time, weeks or sometimes even months. And don’t forget hiring costs, such as a recruiter’s fees or relocation expenses, which all together can quickly add up. Even when you do finally find that someone who seems perfect for the role, you may discover they may not be the right long-term fit. For more specific numbers and an in-depth analysis of building your own team versus hiring a mobile development firm.

The Phoenix Take: Virtual Reality and Business

In June 2015, Oculus unveiled the consumer version of its Rift virtual reality headset. Is this the start of something big for consumers and businesses? Virtual reality requires specially crafted, thoughtful experiences made for the medium. Here’s what Kumar Vivek, Chief Executive Officer at Phoenix App Labs (and Top Developer Award winner by Google) has to say about opportunities in the VR space.

“From a sociological point of view, mobile apps pose a great threat to human interactions. We already see people nose-diving into their devices on public transport, in the streets, in restaurants. I believe virtual reality is a paradoxical chance to stop this regression by rejuvenating and steering human interactions into completely new directions. VR, as a completely immersive medium, has the potential to transfer all existing human interactions into itself. There’s also a chance new interactions will be invented, enabled by the never-before experienced concurrency of technology and soul. We will be separated from each other on the most basic, biological level, but our minds will be connected in much deeper, faster and richer ways.”