Heading up Appcelerator’s apps and marketplace partnerships may be the easiest job in the Valley. On a daily basis, I receive more in-bound interest than I can handle from leading software and SaaS companies to join forces in creating joint offerings for our massive installed base of mobile developers. I get to see the future of mobile analytics for the consumer market in one meeting and then sit through a demo of how enterprises will deploy mobile device management in the future.
In these partner meetings you will often hear me stress one crucial point over and over, “That’s great tech, but what else are you bringing to the table for our customers?” A great partner simply doesn’t bring the best technology to our ecosystem, but also expertise, thought leadership, and best practices. Our community (1.6M+ registered users strong) possesses some of the brightest and most inventive mobile app developers in the world, but they are not necessarily a VP of Marketing, Monetization, or Sales. This is where I want the best Appcelerator partners to come in and be prescriptive in their advice, not only building great apps but also sustainable, thriving businesses.
I am thrilled to announce a new partner that gets our mission. Starting today, InMobi will be available as a key extension to the core Titanium platform. InMobi is not only one of the largest mobile ad networks in the world but also a real authority in helping developers build their mobile app business. Please welcome inMobi to the Appcelerator community and read a terrific post by Jeremia from the InMobi team.
Guest post by Jeremia Kimelman, Developer Envagelist for InMobi.
So you have an app…
Awesome! Building a functioning mobile app is an achievement in itself. But we’re willing to guess you aren’t just looking to have a mobile app in the store for the sake of seeing your name on iTunes or Google Play. We’ll bet you’re more interested in developing a mobile business than an app. And if that’s true, then there’s a lot more than just coding up an app using Appcelerator.
Let’s quickly examine the lifecycle of an app from the business owner’s perspective:
Idea/Planning -> Building/Coding & Testing -> Release & Deployment -> Feedback collection -> and back to the beginning to start again.
Here’s the real rub: No app can succeed without each part of this lifecycle being executed well.
- If you don’t have a well thought out idea, or plan, then nobody will download/buy your app in the first place — BAD
- If you have a poorly coded app, the experience will simply serve to frustrate users and they’ll never open it again — BAD
- If you don’t have a release strategy, its likely that your app will languish amongst the thousands of other apps buried in the App Store — BAD
- If you ignore feedback, users will feel alienated and you might be missing out on that killer feature that will really make your app pop — BAD
You can only monetize step 3: deployment. In fact, there are only four ways to monetize any given mobile application:
- Paid downloads
- In-app purchases
Each has its own advantages and disadvantages. The only way to actually know what works best for your app is to test, test, test. A metric that will help you figure this out is the LTV, or life-time value of each customer. You can perform a very simple calculation by employing the following:
LTV = ((Average Revenue of Customer per Week) * 52) * Average lifetime of customers in years
Keep this LTV number handy at all times, as it will become the foundation of your mobile business plan. You can figure out which is the most successful monetization option for you based on what the LTV of each customer is given each option.
Which leads us to our next problem, three out of four of the above monetization options generate revenue that is proportional to your user base. Thus, one of the ways to increase monetization is to increase your user base. Now each of the lifecycle steps is important to track new users, but in the age of HALF A MILLION APPS in the App Store, its harder and harder to drive downloads organically. This is where your paid user acquisition can come in and help you gain some initial traction. Of course, paid user acquisition is a topic for another post, but the bottom line is always make sure your cost per acquisition is less than your LTV.
As with any business model, its important to have forecasts and reasonable assumptions about how much money you can actually make. Of course, you’ll never know the exact variables until you test your app and your customers, but we can make fairly broad generalizations. In fact, InMobi has created an online forecasting tool that can help you understand how much revenue you can make from mobile advertising. All you have to do is head to our Economic Toolkit and start adjusting the inputs to reflect your current or future app.
View or Dowload Webinar: how to build a great business from your mobile apps.
InMobi and Appcelerator are excited to announce a partnership to help mobile developers monetize their applications. In fact, the first 200 Appcelerator developers to register here get $100 in free ad credit, so sign up now! (PASSWORD: Mobile)
And don’t forget to download the new InMobi Titanium modules at the Appcelerator Marketplace to start generating revenue today.
Spencer Chen is the Sr. Director of Business Development at Appcelerator. He loves the social web, mobile, and TMZ. You can follow him here on Twitter.