I read an interesting article on VentureBeat (sourced below) on how to drive installs for mobile apps and what the implications of doing so entail. It raised an interesting thought because I've seen this practice in reality at many tech firms. Many developers are focused at driving paid installs with the goal of increasing the app's rank in the app store. This in turn should drive more organic growth. But the reality is clear, this is not a sustainable process but many people and companies do it nonetheless.
What are the right strategies when the KPI is #of installs, #of users, or traffic size? Often times these are the KPIs that success is measured against, but I believe they can force marketers (and product managers) to use shortcuts and unsustainable means to achieve them. For example, let's say a particular online product (say a small video website) is trying to acquire more users, since more users means more advertising dollars. Initial users will be cheaper and easier to acquire because the potential audience is everyone - the website can target individuals on the most relevant demographic and behavioral profile as found in market research. But as its user base grows, less and less users are available to acquire onto the product and thus, CPA grows. What I've seen are more desperate means of acquiring incremental users as this decreasing growth rate begins. Product people start caring less about the quality of the users given their focus to acquire X-number of users. Why is this so important when we're taught to always compare LTV and CPA? Because acquiring a large number of users or being a leader in a particular space is a very attractive advertising story. It can draw in advertisers, marketing partners, a large number of affliates, and more. However, at the end of the day, I strongly believe in optimizing and acquiring users in channels where CPA is low and LTV is high. A high LTV ideally translates to greater engagement and active usage, which is just as compelling a story for advertisers.
Source: http://venturebeat.com/2014/09/23/crushing-your-next-mobile-app-install-campaign/
What are the right strategies when the KPI is #of installs, #of users, or traffic size? Often times these are the KPIs that success is measured against, but I believe they can force marketers (and product managers) to use shortcuts and unsustainable means to achieve them. For example, let's say a particular online product (say a small video website) is trying to acquire more users, since more users means more advertising dollars. Initial users will be cheaper and easier to acquire because the potential audience is everyone - the website can target individuals on the most relevant demographic and behavioral profile as found in market research. But as its user base grows, less and less users are available to acquire onto the product and thus, CPA grows. What I've seen are more desperate means of acquiring incremental users as this decreasing growth rate begins. Product people start caring less about the quality of the users given their focus to acquire X-number of users. Why is this so important when we're taught to always compare LTV and CPA? Because acquiring a large number of users or being a leader in a particular space is a very attractive advertising story. It can draw in advertisers, marketing partners, a large number of affliates, and more. However, at the end of the day, I strongly believe in optimizing and acquiring users in channels where CPA is low and LTV is high. A high LTV ideally translates to greater engagement and active usage, which is just as compelling a story for advertisers.
Source: http://venturebeat.com/2014/09/23/crushing-your-next-mobile-app-install-campaign/
No comments:
Post a Comment