Richard Firminger

November 2012

Marketing in the Mobile First Era

Richard Firminger, GM, EMEA

STAGE 3: THE TWO-SIDED PLATFORM

Pu

blis

her

s

Ad

vert

ise

rs

APP MEASUREMENT AND ADVERTISING PLATFOM

LAUNCHED JUNE 2012- THE TWO-SIDED PLATFORM

PUBLISHERS: DIRECT, INDIRECT, DESK TRADED AD MONETIZATION

ADVERTISERS: AD EFFECTIVENESS, MEASUREMENT AND ROI ANALYSIS

BUILT IN NETWORK EFFECTS

Flurry Analytics 1

APPCIRCLE

2

AP

PSP

OT

AD

A

NA

LYTI

CS 3 3

-

10

20

30

40

50

Jul 08

Sep 08

Nov 08

Jan 09

Mar 09

May 09

Jul 09

Sep 09

Nov 09

Jan 10

Mar 10

May 10

Jul 10

Sep 10

Nov 10

Jan 11

Mar 11

May 11

Jul 11

Sep 11

Nov 11

Jan 12

Mar 12

May 12

Jul 12

Flurry Sessions per Month

The Rise of Mobile Apps B

illio

ns

74 MINS

81 MINS

Web Browsing vs. Apps

Web Apps

Web Apps

21 MINS

26 MINS

Facebook vs. Social Apps

2 20

80

200

250

350

460

28

160

250

400 425

500

600

March 2009 December 2009 August 2010 May 2011 July 2011 October 2011 April 2012

iTUNES APP STORE GOOGLE PLAY

Competition for Consumers Continues to Increase

Over 1 million available apps on iOS and Android

Active smartphone & tablet devices

Addressable Market to Surpass 1 Billion Next Year

Aug 2009 Aug 2010 Aug 2011 Aug 2012 Aug 2013E

23 M 76 M

331 M

660 M

1.1 B

Source: Flurry Analytics

Total Addressable Market

Aggressive: 5B WW Mobile Device Owners

Conservative: 2B WW Adults, Middle Class or higher

Upside:

Smartphones – dropping prices, especially Android

Tablets – little replacement, mainly new; sub for PCs

Connected TVs – to be shipped

Reference:

2.3 Billion Internet Subscribers today

Source: Flurry Analytics active devices July 2012

Top Countries by Active iOS & Android Devices (millions)

Apps Are Disrupting the World

Source: Flurry Analytics, July 2011 – July 2012, countries with at least 500k active devices as of July 2011

401%

279%

220% 217% 196% 193% 193% 189% 185%

171%

China Chile Brazil Argentina Iran Vietnam Mexico Russia Turkey India

Fastest Growing iOS & Android Markets by Active Devices

Apps Are Disrupting Emerging Markets

1% 1% 1%

1%

2%

2% 2%

3% 2% 3%

3%

4%

6%

1% 1% 1% 1% 1%

1% 1% 1% 1%

1% 1% 1%

1%

0%

1%

2%

3%

4%

5%

6%

Jun 2011 Jul 2011 Aug 2011 Sep 2011 Oct 2011 Nov 2011 Dec 2011 Jan 2012 Feb 2012 Mar 2012 Apr 2012 May 2012 Jun 2012

BLACKBERRY WINDOWS PHONE

Flurry New Project Starts, RIM vs. Microsoft

Microsoft Blows by a Beleaguered Research in Motion

Source: Flurry Analytics

71%

27%

1% 1%

68%

28%

3% 1%

Source: Flurry Analytics

iOS Android Windows Phone BlackBerry

Q2 2011 Q2 2012

Microsoft Sets Its Sights on Android

Flurry New Project Starts Q2 2011 vs. Q2 2012

Sources: comScore, Alexa, Flurry Analytics; data includes Smartphones & Tablets, U.S. only

MINUTES

70 MINUTES

66 MINUTES

74 MINUTES

81

MINUTES

64

MINUTES

43

WEB BROWSING MOBILE APPS

MINUTES

72 MINUTES

94

Mobile App Usage Overtook Online in 2011

U.S. mobile apps vs. web consumption, minutes per day

Share of time spent on smartphones

Mobile Apps Dominate Time Spent on Smartphones

Source: comScore, March 2012

More than

80% of mobile minutes

are spent in apps

18.5% Browser

81.5% Apps

Loyalty by Application Category

Smartphones, Tablets and TV’s

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

5am 6am 7am 8am 9am 1pm 2pm 3pm 4pm 5pm 6pm 7pm 8pm 9pm 1am 2am 3am 4am

% o

f A

udie

nce

Usin

g

Hour of Day

Source: Flurry Analytics, Sep 2012

Smartphones

Tablets

Tablet Usage Is More Concentrated during Primetime

Usage by Hour, Smartphones versus Tablets

Weekly Frequency of Use

12.9

4.1

9.5 8.2

Minutes per Session

Smartphones Tablets

Tablet Usage is Longer but Less Often

App Engagement, Smartphones versus Tablets

18% 21%

33%

21%

7%

19%

14%

26% 24%

17%

Source: Flurry Analytics, Sep 2012

13 - 17 18 - 24 25 - 34 35 - 54 55+

Average Age

Smartphones:

Tablets:

30

34

Smartphones Tablets

Tablet Users Trend Older

Age Distribution, Smartphones versus Tablets

Smartphones Tablets

44% 56% 49% 51%

Source: Flurry Analytics, Sep 2012

Tablet Usage is More Gender Balanced

Gender Comparison, Smartphones versus Tablets

Smartphones Tablets

Games 39%

Social Networking

24%

Utilities 17%

Health & Fitness

3%

Lifestyle 3%

Entertainment 3%

Other 11%

Games 67%

Social Networking

10%

Entertainment 9%

Utilities 4%

News 2%

Productivity 1%

Other 7%

Tablet Usage More Media & Entertainment Oriented

Time Spent per Category, Smartphones versus Tablets

Time spent using smart devices while watching TV

Even Canabilising Prime Time TV Viewing

1.6 HRS

Sources: OPA / Magid Portrait of Today’s Tablet User Wave II, July 2012; Portrait of Today’s Smartphone User, August 2012

TABLET

OWNERS

SMARTPHONE

OWNERS

1.6 HOURS

1.7 HOURS

of mobile device

owners spend over

84%

1.6 hours per day using mobile

devices while watching TV

Mobile Ad Spends Are Taking Off

43%

29%

16%

11%

1%

40%

6%

22%

9%

23%

TV Print Web Radio Mobile

Sources: VSS, Mary Meeker (KPCB), comScore, Alexa, Flurry Analytics

TIME SPENT PER MEDIA

AD SPEND PER MEDIA

2011 U.S. ad spending vs. consumer time spent

A Shift in Ad Spending Is Inevitable

% of marketers in 2011 that planned to:

Marketers Are Already Committed

Source: IAB / Ovum Marketer Perceptions Of Mobile Advertising July 2011

72% Increase 2012 Mobile Ad Budget

35% Increase Mobile Ad Budget

BY OVER 50%

$-

$1

$2

$3

$4

$5

$6

$7

$8

$9

Bill

ion

s

82%

18%

77%

23%

Source: Flurry Analytics, forecast based on Flurry analysis

ADVERTISING REVENUE

PREMIUM & IAP REVENUE

2010 2012E

Revenue Is Scaling

WW iOS & Android App Revenue by Source

Mobile App Media Maturing

TODAY OVER NEXT 12 MONTHS

Loosely-targeted Campaigns

Target User Interest, Age, Gender and Location

Unable to Measure Campaign Effectiveness

Track Conversion Quality and Brand Metrics Impact

Fragmented Media Is Hard to Buy

Purchase at Scale via Agency Trading Desks and Premium Media Representatives

The App Marketing Virtuous Cycle

1. The Current State of App Marketing

2. Can We Find Another Way?

3. The New App Marketing Virtuous Cycle

The New App Marketing Virtuous Cycle

• Buy enough thrust to get into orbit (downloads in 24 hours)

• Don’t worry about the quality of users you’re using as thrust

• Once you rank, your app gets an organic lift

• And then, when you run the numbers, blended CPA is “cheap”

• What’s wrong with this picture?

Today App Marketing = App Store Rank

Fuel Prices Are Going Up

Rank Required Subsequent

1 150,000 180,000

Top 5 125,000 150,000

Top 10 100,000 125,000

Top 15 75,000 100,000

Top 25 50,000 75,000

Top 50 30,000 45,000

Required = number of downloads required in 24 hours to reach position Subsequent = number of downloads per day once position is reached

It’s Already Expensive

USERS ACQUIRED

JAN – JUN 2012

1.9 Billion

Source: Downloads and Usage Tracked Across All Acquisition Channels by Flurry Analytics

120 Million STILL USING DURING

1ST WEEK OF OCTOBER

94% of all acquired users churn out

Retaining Users Is a Challenge

Spenders

Social Influencers

Heavy Users

Key Target Demo

In Favorable Geo

Used More Than Once

Use

d B

efo

re L

ast

Up

dat

e

STILL USING DURING

1ST WEEK OF OCTOBER

USERS ACQUIRED

JAN – JUN 2011

1.9 Billion

120 Million

Source: Downloads and Usage Tracked Across All Acquisition Channels by Flurry Analytics

What if You Could Bring Back Your Best Users?

ACQUIRE

TO RANK ORGANIC

LIFT

ACQUIRE

SEGMENT

RE-ENGAGE

CURRENT APPROACH:

RANK DRIVEN

A BETTER APPROACH:

CONSUMER LTV

A New Approach to Break the Churn Cycle

Leverage Engaging Units and Optimized Pricing

New Re-Engagement Trailers Custom Creative

CPI basis, bidded

$0.75 minimum bid

CPR basis, bidded

$0.50 minimum bid

CPCV basis, bidded

$0.02 minimum bid

CPC basis*

(to App Stores)

bidded, no min bid

*Flurry Ad Analytics is required to track installs

• Reach over 250 million mobile app users through AppCircle

• Get the deepest targeting on mobile

–Device and OS

–Geography, down to the city level

–Age and gender

–Personas (over 22 to choose from)

• Re-target your valuable segments

–Based on segments and analytics events in your app

–Based on time lapsed since last use

Get Unmatched Reach and Targeting Options

• Measure the performance of all user acquisition channels

• Track the performance of quality conversions the way you define it

• Automatically create segments to track retention and churn per channel

• Absolutely no disruption to the user experience or flow

Flurry Ad Analytics: Optimize User Acquisition Spending

Measure cost and quality of users by acquisition channel

This is a big deal for mobile app developers and marketers because, currently, these folks

are buying from something like ten to fifteen ad networks, and yet have little visibility into the

types of users being returned. TechCrunch, June 2012

Buying from so many sources, brands are often left to question whether the acquisitions they

receive are of value to the brand and its success metrics. Ad Analytics automatically tracks

clicks and installations and attributes them to the correct campaigns and traffic sources. It

then allows marketers to view the behavior of users after they download. AdAge, June

2012

Turning Apps into Media Properties

43%

29%

16%

11%

1%

40%

6%

22%

9%

23%

TV Print Web Radio Mobile

Sources: VSS, Mary Meeker (KPCB), comScore, Alexa, Flurry Analytics

Time Spent per Media

Ad Spend per Media

2011 U.S. ad spend versus time spend per media

The Great Mobile Advertising Gap

Not All Advertising is Created Equally

Optimized

$5+

Today

$1.5

Optimizing your ad mix

can increase

ad revenues

by more than

3X

Mobile Publisher eCPMs

The eCPM Impact of Attracting Premium Advertising

Brands Are Moving to Mobile

Source: eMarketer, April 2012

So What Do Brands Need?

Audience Scale Audience Targeting

You Have It You Need It

1. Understand your audience

2. Define the advertisers you want to attract

3. Come up with an immersive, quality experience

4. Package it right

5. Get your sales team: Build or Outsource

6. Execute the campaign

How to Make Your Applications Media-ready

Thanks [email protected]