Tag: segmentation

With advertising you want to reach the people who are interested in what you are promoting.   Frequently, developers will select one advertising network and that’s it.   One trick shows can get old pretty fast.  Mixing it up a bit though?  Here’s four reasons to consider in using multiple advertising networks to promote your mobile apps and other products.

The Bellcurve

Not everyone uses their mobile devices with the same regularity or same reasons.  For very general and basic purposes, we’ll refer to the bellcurve below based upon the Paretto Principle, also known as the 80/20 Rule.  That is, 20% of people will generate 80% of the results.  It also considers a similar breakdown to each “subgroup”.  It doesn’t always work out this way, but it works out often enough and well enough to illustrate some user group segmentation.

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This asserts that it will be easier to reach some people than it will be to reach others.  A very basic (doh!) observation.  You determine in your marketing efforts the user groups you really want to reach.  This is likely to be driven by your break even points, lifetime customer value, ROI on your adspend, and a variety of other factors.

Very generally, it prescribes the idea that if you have a very limited advertising budget that you will want to get as many of the super users as you can within a given market.  Market does not necessarily equate to advertising network as few if any advertising networks have 100% market reach.

With a very small advertising budget (sub $100/monthly) you might simply concentrate on one advertising network.  With a $1,000 monthly advertising budget, you may very well look to spread the budget across one or more additional advertising venues within that market to capture a broader cross-section of the market’s “low hanging fruit” (active and super users).  Larger budgets ($10,000 monthly) **begin** to get into “saturation campaigns”.  A saturation campaign aims at reaching up to 80% of the eligible market across multiple or all advertising networks and other venues.  These are just very, very loose guidelines.

The Law of Diminishing Returns

Most good marketing and advertising campaigns perform well early on and gradually taper off.  Essentially, the more people who download your app the smaller the remaining pool of people who might be interested in your app becomes.  For most independent and small business developers of mobile apps, this is not likely a major factor.  Nevertheless, if you start a campaign and it does well initially and drops off, this is one of the factors at play.

Knowing that provides your mobile app marketing a booster shot — by changing your advertising, logo, screenshots. This can prompt people who have seen but did not respond to your previous adds, to give your app another look.

You Don’t Know… What You Don’t Know

Borrowed from Donald Rumsfeld, and it may sound stupid – but it isn’t.  If you haven’t tested something before, you don’t know how it will behave.  Some might say a certain advertising venue is bad, while others may say it is good.  The simple fact that there is an advertising network in business is sufficient justification to give it a test.  The majority of developers spend little to no time marketing their app.  The minority who do are more successful in monetizing their mobile apps.  Each app is different, each advertising venue is different, each market is different.

Thus, trying out different advertising venues is like performing an A/B or multivariate test.  It relies upon the same reason that instead of sending out one large mass mailing to everyone on your mailing list, that you send out two or more different emails with the same message to see which gets a better response.  Aside from being something you constantly want to do, constantly want to improve, this helps determine the distribution of your adspend.

Developing Market Relationships

And for everything that we’ve seen, things change.  The global market changes constantly, as do the companies and people in it.  It may be that you are only looking to produce and market one app and then… that’s it.  No more apps.  One thing that is known,. however, is that the longer a developer is in the market the more likely they will become successful.  Part of that comes down to learning how to produce better apps, market more effectively, and connecting with people and companies who can assist you.

If these points make sense to you, consider talking to Sandra, Andrew, Natalia, Anna or Alex — Opera Mobile Store’s Business Development Managers who would also be happy to link up with you on LinkedIn!

If you intend to market globally, it helps to understand it is comprised of many different markets and almost every one of them is different. Applying dynamics specific to the North American Market won’t work very well in Southeast Asia or South America. Localization covers a lot of the topics inherent to international marketing. Localized pricing is the focal point of this article.

The cost of tailoring an app to a specific market usually runs a fraction of the overall cost of producing an app.

In the North American and European markets, average income is dramatically higher than many developing markets – Southeast Asia, Eastern Europe, South America, the Middle East and North Africa. Overall population by mobile device and platform, income distribution and local market nuances all play a role in finding optimal pricing.

Pricing Segmentation is an approach to customize the price of a product to a specific market for maximum gain. What is affordable in one country may not be affordable in another. The Big Mac Index is a really good example of price segmentation. In 2012, the price of a Big Mac in Norway was $9.63, but only $2.44 in China. Profit margins on each product vary from store to store.

Electronic downloads largely bypass costs of packaging, storage, shipping and more. The cost of development and production of software, including mobile apps, does not radically differ whether you produce just one copy or millions of copies (vs. physical production).

Another factor that must be considered is the relative ease of doing business in the mobile app market. Getting your product on the shelf is far less of an issue in mobile than in a software store or supermarket. As a developer, you can add your product to Opera Mobile Store in a matter of minutes.

Of course, for an app to be profitable requires recovering all of the costs involved with its initial research, design, development, testing, and other overhead. There is also a development and marketing cost for each localization effort. Finally, there is the cost of distribution via different advertising models. Each of these expenses needs defined so that you know your breakeven point for the main product, each localization effort and per install within each market segment.

These points considered, localized marketing efforts need to recover the cost of your localization work and advertising costs per install.

One point frequently heard is that the profit margin in developing markets is lower. Yes, that is usually true – but your ROI per market is tied more to the cost per localization than the overall app. More importantly is whether you see your app as an end unto itself or as the means to further ends?  Are you mainly trying to sell apps or win customers?

Cost and effectiveness of advertising varies by ad network, by region and by app genre. It is a mistake to ignore developing markets just as it is to enter a market without researching it. Every app is not going to fit every market equally. Some may not fit at all.

There is ample guidance available simply by looking at where and how “big companies” do business in countries you might ordinarily dismiss.

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