The Value of the Long Term Value of App Users

The long-term value of mobile gamers is the most meaningful metric a developer can employ to determine if your app has real profitability. It is a game changing metric for those that are paying attention. Standard model metrics that determine the overall profitability of your app that have been used up until this point fail to take into account future revenue. From a business stand point this has not always been a go-to technique, as it feels like counting your chickens before they are hatched. But the industry has had a long enough time-line now that future revenues are a reliable metric. As with anything new and shiny in an industry, paying attention to this metric can have profound effects on your income.

To take advantage of this metric we first have to figure out how to calculate it. To do this you first calculate three metrics that more than likely you are probably already obsessed with.

Monetization (how much cash revenue you are pulling in). This is determined mainly by calculating three things: The amount of revenue each user will bring in, the amount of revenue that paid users bring in, and the average daily revenue of each active user. This may seem like a lot of calculation of different overlapping areas of revenue but trust me this number is literally gold.

• Retention (people coming back to your app). You get this metric by breaking it down into three areas just like we do with Monetization. The first is how often people come back to your game, be-it daily, weekly, or longer. 

• The second is how many people return to the game overall, and the third is how long they stay logged into the app. (the last is very important for targeted ad revenue which we will get into later).

• Vectoring (how viral your app is). Much like the CDC tracks the path of an outbreak of the flu, you can track the viral potential of your app by calculating the ephemeral quantity of free users that “infected” users will bring in with word of mouth and personal interaction media.

Congratulations! With these macro-metrics in hand you can determine what the LTV of your app users are. You have gained a magic ability that is much sought after in the business world. You can see the future!

Now before you plotting to take over the world there are a few things you need to do first to get the most out of your newfound super powers. The biggest thing and probably the elephant in the room is targeted marketing. Once you know how many customers you will retain over a quarter you can stop wasting advertising dollars on customers you know wont be coming back and focus them like a precision laser at those customers you are going to retain. For app developers the correct balancing act of how much advertising dollars to spend and where is the life and death difference between success and the herd.

With the metrics you now have you can also see where you lose retention of your customers. If everyone is leaving your app after 4 months of regular play, then you now know where your app needs improvement or alteration. You can objectively address the use of your app and make targeted changes to keep your audience coming back for more. The more they come back the better the rest of your metrics will do as a byproduct. Which as we all know is the name of the app developing game.

There are potentially dozens of ways that this metric can help the app developer in ways that standard model metrics cant begin to touch. I only described some of the big umbrella effects that are readily apparent. If you want to maximize your income potential then any information is power when planning for the future. Calculating the LTV of your users is an iceberg disguised as a sundae cone and it can mean the difference between following your own dreams in creating a real foothold in the industry or sinking like the Titanic.


Other posts that might be of interest:
Are Apps Really Money Makers

Using Yahoo Answers for Free Advertising and Backlinks

One of the main activities of any blog or website is, wherever possible, to take advantage of free targeted traffic; this is why webmasters spend so much time trying to find ways of improving their position in the Google search results. However, there is one very simple method of getting free traffic which is often overlooked by webmasters: Yahoo Answers. The bottom line is that Yahoo Answers is the largest community of knowledge sharing on the Web and getting some of this huge audience interested in your products or services can yield huge benefits.

Not only is Yahoo Answers a great method of generating targeted traffic, it is also a terrific source of free advertising. If you add this free publicity technique to your marketing strategies, you will soon discover how incredibly powerful it is.

One of the key aspects of this strategy is that it is all about participation; so, the first step you need to take is to sign up (by visiting answers.yahoo.com) and to complete your profile, adding as much information to it as you are happy to share. It is also a good idea to upload an avatar; probably not your logo; perhaps your photo; or some other friendly graphic associated with your brand.

Next, you need to familiarize yourself with the Yahoo Answers platform: browse through the categories of question which are relevant to your niche; and decide which types of question you are interested in answering.

Before you begin to answer any questions, however, you should have a clear idea of what you want to promote. This way you can home in on those topics that will be relevant to the site you want to promote via Yahoo Answers.

Your first public activity will be to answer lots and lots of questions; try and aim for the maximum allowed, which is twenty questions per day. The reason for this is that Yahoo operate a system of points and levels: when you sign up, you are a level one user and Yahoo allocates you 100 points; in order to reach level 2, you need 250 points; and, until you reach level 2, you will not be able to include backlinks in your answers.

You are assigned 2 points for every question you answer; so, if you answer the maximum of 20 questions, you will earn 40 points daily; and, in four days, you will have reached level 2 status. However, if any of your answers is picked as the best answer, you are awarded an extra 10 points; and also, every time you yourself vote for answer, you are awarded an extra point. So, as you can see, achieving level 2 status is not a tall order, and it is definitely worth the effort.

Once you have reached level 2, whenever you reply to a question, you have the possibility of including a website link in the "Source" box accompanying your answer. This is an easy way to get some free advertising and to encourage visitors to find more information on the subject discussed in the question.

Even after you have reached the coveted level 2, it is still beneficial to supply the best answers you can. Answers which are picked as best answers will achieve a higher rating in the Yahoo search results and will inevitably bring more traffic to your website or to your affiliate offer. So spend some time studying those answers, which have been picked as best answers and try to analyze what made them appeal to the person asking the question.

Due to the large number of people who may reply to questions, it is also important to be the quickest to respond to questions, which are still open for answer. You should also do your best to answer each question as thoroughly as possible and be sure to address the person who sent the question by his or her first name (if possible). This will increase your chances of being chosen as provider of the best answer.

Yahoo Answers includes a spell checker; so be sure to use it whenever possible to minimize errors; or type your answer in Microsoft Word, check the grammar there and copy and paste into Yahoo Answers when you are happy with it. Take your time to get it right; do not forget that your ultimate goal is to be selected as the best answer.

Once you are up and running with Yahoo Answers, it simply becomes a question of optimizing your efforts to ensure you get the best results possible.  Here are the key points you should keep in mind.

• When choosing which questions to answer, look for recently posted questions with either no answers or only one or two.
• Ensure that the URL you post in the source box contains the topic mentioned in the question: for example, if the question was about "acne cures", your URL might be something like "mysite.com/acne-cures.html".
• Try to include your niche keyword within the body of your answer; this is useful for search engine optimization.
• You can even include a backlink within the body of the answer (using an HTML a tag with an href attribute); but do this sparingly and make sure that it appears totally relevant to the topic being discussed.

Compared with many advertising techniques, using Yahoo Answers may seem like hard work. However, the rewards can be huge: it is not only the Yahoo search engine, which will pick up your answers (and links). Google can also index your answers; so be sure to answer as many questions as you can every day.

Top Five Tips for Using Google AdSense

Monetizing your website traffic can be a tricky business, but with an intermediary like Google AdSense, it doesn’t have to be.  For large corporations, this usually means hiring an entire department to manage ad revenue, but for a small business or your own personal blog, using a service like Google AdSense is the most efficient way to connect you with the advertisers who want to give you money.  Like anything, there is a right way and a wrong way to go about this, so here’s a list of the top five ways to make the most of your partnership with AdSense.

1. Getting Started

The AdSense website has plenty of information on getting your account up and running, but some simple things might get lost in the shuffle.  You can have up to three ads on your page, so you might as well have all three.  Link units are also a good option.  And, as a general rule, use the most open settings you can for selecting ads.  Having both images and text enabled, as well as sticking to the standard sizes – 160x600, 728x90, and 300x250 – gives you and AdSense the most options to draw from.

2. Learn the Art of Placement

Your website is your very own piece of two-dimensional real estate, so know where on it users are most likely to look and most likely to click.  Content on the left of the page is usually viewed first, so ads there are more likely to draw attention, and in general, ads above the fold (at the top of the page) are viewed more.  However, be careful to avoid separating the ads from the content, such as with a banner at the very top of the site – as soon as your reader scrolls down, a top edge banner is out of sight and out of mind.  You can even try your hand at “omnipresent” ads, which follow users as they navigate your site so they’re never missed, although this is a somewhat risky move as some users find omnipresent ads an insufferable nuisance.

3. Make Sure the Advertisements Fit with the Theme of your Website

AdSense allows you to control certain aspects of the ads that are put up on your website.  For text/link ads, you can change the color and font size of the ads to fit with the overall look of your site and avoid being overly distracting to your users.  With picture, video, and interactive type ads, you can choose where on the page they are placed, and you always have the right to say no to an ad you don’t find visually pleasing.  People (your users) are visual creatures, so having a good-looking site ruined by intrusive ads is a major problem.

4. Don't Neglect Mobile Users

Mobile users are a rapidly growing percentage of almost every website’s total traffic, so you can’t afford to have ads that won’t perform on a small screen.  Make sure load speed is AdSense’s top priority to avoid bogging down your ads and your whole site.  One especially useful option with AdSense is responsive ads, which allows your site to automatically adjust ad sizes to fit different mobile screen sizes.

5. Don't Get Lazy
You've put a lot of time and effort into making sure Adsense is working for you, and now that you have optimized you might be tempted to kick back and relax. However, AdSense is always adding new features, tweaking options, and bringing you advertisers who might be willing to pay you more than what you're currently getting. The official AdSense site is a good place to keep up with updates and new features, and after you've gained some experience you can join AdSenseExperts.com to learn some more advanced monetization strategies. In the long run, keeping your advertising strategy dynamic will pay huge dividends.

9 Tips for Startups Using Google Adwords

9 Tips for Startups Using Google Adwords

Google Adwords is one of the most prominent cost per click tools for customer acquisition on the Internet.  Because of its dominance in the marketplace, many startups use the tool to help gain exposure for their products.  The problem for startups new to Adwords is the sheer complexity of the platform.

Here are some helpful tips for creating successful Adwords campaigns and making the most of your budget.

1. Do thorough keyword research

There are a number of keyword research tools that are provided by Google including the Adwords keyword tool, Google insights and the Google traffic estimator.  Use these tools to understand the number of queries for a specific term, the competition for those terms and the cost of a campaign targeting those terms.

The general principle with keyword targeting and Adwords campaigns is the more specific and targeted your keyword is, the better the conversion rate.  Look at what customers want and what your startup provides, then think about the keywords to link the two.

2. Use multiple keyword match types and negative keywords

In Adwords you can set a type of keyword match to target (Broad, Phrase and Exact). Tailor the keyword match types with care and think about how your prospective customers will be looking for your product. If there are keyword combinations that don’t match the intention of your startup, remove them by using negative keywords. Also utilize category targeting and topic targeting to further target your advertisements. By being very specific you can stretch out a small Adwords budget.

3. Consider bidding on your business name

If your search engine optimization is not up to scratch, it is possible that customers searching for your startup by its name may not see it on the first page.  If this is the case, bid on the name of your business to help people find it easily.

4. Build ad groups around a theme

If you have a product that has multiple functions, create ad groups tailored to each function.  For example, if you were selling an iPhone video application that can change the format of videos, upload to Youtube, share via iPhone and add creative effects — create an ad group for each of those capabilities.  The “upload to Youtube” ad group would target people who are searching the Internet for a way to upload edited videos directly from their iPhone to Youtube.

5. Write great copy and use a call to action

If you aren’t the best at copywriting, hire someone to do it for you.  Adwords can be expensive and if you aren’t making the most of the short sentences in the advertisement, you could be wasting money.  Also include a call to action in all advertisements to help obtain a better click through rate.

6. Create multiple advertisements and test them

By split testing advertisements you can ascertain which ones have the highest click through rate and conversion rate.  Continue to refine your advertisements even after finding combinations that work.

7. Check ads for quality score

The Adwords quality score refers to how relevant your keywords, ads and landing page are to people who see the advertisement.  A high click through rate (CTR) indicates that people seeing the ad find it highly relevant to what their needs are.  It is important to maintain a high quality score for a number of reasons, but chiefly the fact that it leads to lower cost per click, lower first page bid estimates, lower top of page bid estimates and better ad auction eligibility.

8. Make great landing pages relevant to keywords

At the end of the day, your Adwords campaign is about making sales and gaining customers.  You should spend a great deal of time crafting and testing landing pages that are highly relevant to your target keywords.  It is a good idea to create multiple landing pages for different ad groups, so you can split test these pages.  Again, copywriting is extremely important and this last step of the conversion process requires a flawless marketing pitch that meets customer expectations.

A great landing page will also have a lower bounce rate, which is tracked by Google and helps maintain a high quality score.

You should pay close attention to functionality as well.  If you have a shopping cart on the website make sure it is extremely fast and easy to use, make sure the text is easy to read, make sure the landing page has a sense of legitimacy and security about it.  Mobile traffic is also increasingly important, so make sure your website looks great on everything from laptops to tablets and smart phones.

9. Use conversion tracking and Google Analytics

It is critical that you understand which parts of your Adwords campaign are successful and which parts are not.  You should use Google Analytics and track successful conversions to understand what is working within your campaigns.  If your product doesn’t have a checkout process, look at bounce rates to determine if the visitors are a good match for your startup.

Setting Expectations

It’s important to remember that Google Adwords should only be one part of your promotional campaign for your startup.  When you are starting out, expect to spend money simply determining what works and what doesn’t.  The key is to start small, test often, and work your way up to having a highly targeted and successful Adwords campaign.

The Benefits of Business Networking

If you are an entrepreneur, small business or planning to set up a new business it's worth joining a local business networking group. In simple terms this is a group of people who run their own companies (or represent a company or franchise) and work to help each other out through their connections. In order to get the most out of it helps to know what networking is and what it can do for you (and what you can do for other members).

The Right Networking Group

The first thing to consider is the kind of networking group you want to join. Some are very loose and informal while others will have a more rigid structure. Some people prefer the rigid structure because they know the rules and people have to follow certain procedures and guidelines. For example some are very strict with regard to who can be members with only one member allowed to represent one type of company.

The theory with this is that people are more likely to use each other's connections if they are not in competition. Other organisations believe competition is healthy and indeed in some cases similar companies can work together in order to get more work and to benefit each other in a positive way.

There is no right or wrong as such. Most networking groups allow you at least one free trial visit so you can gauge whether or not the group feels comfortable and works for your particular needs.

Networking Effectively

In order to network effectively you need to approach it in the right way. It is about developing relationships and making connections. While you may get some sales on a first go what is more likely is that it will take a bit of time to get to know them and how they can help you and you can help them.

The latter is a crucial consideration. You need to think how your experience or service can benefit another member of the group and if not whether or not you know somebody who can benefit them as well. The benefit of this is that people will then encourage other members to use your services because you are prepared to work hard for them.

Over time it will then become easier for people to know you and vice versa. As new members come in equally you can do the same and help them.

Office Party

One of the problems of setting up your own company is that you are often alone. To start with you are unlikely to have employees as such. This can limit the amount of time you spend with other people and it can make you feel more isolated, something that often leads people to quit working for themselves in order to go back to paid for work.

Business networking can fill this social hole. You have an event you can go to on a regular basis and there are people you can talk to who are in the same situation. There is the chance to relax and discuss work in a way that would be more difficult otherwise.

The Main Benefits

The main benefits of business networking for a new business are-

• Increased range of potential clients
• More connections
• Get to know people in the local area
• Develop your self confidence
• Learn from experienced business professionals
• Social events

In short if you are setting up a business for yourself then it helps to get support and this is the best way to get the connections you need to develop. Look online to see what is available in your local area and find the best groups for you.

Turning Apps into Money Makers

Most people create apps for one reason: to make money. But before you start developing that code, there are a few realities you should know in order to understand revenue modeling for free apps. 

It’s not easy to make it. And it’s going to take persistence and money to get off the ground and get the word out for people to find your app. Don’t fall in to the trap of assuming that your app is so amazing that people will find it on their own. As of May 2015, there were 1.5 million apps available for Android devices; and 1.4 million available apps on Apple’s App store (source: Statistica).  There’s no market where competition is fiercer than the app world. You will need to be ready to create buzz, visibility and traffic to generate downloads and this will require a dedicated budget spend.

So how do you start money coming in? Here are 3 key factors to building financial success:

1.  APP UPGRADES

Attract downloads with a free, ‘lite’ version of your app which allows users to try out the app and get used to the features. Promote the benefits of a full/premium version of the app to generate conversions and paid upgrades.

2.     IN-APP ADVERTISING

This is perhaps the easiest way to generate revenue from your app, as well as build engagement for your app.  The way it works is by allowing advertising with linking to be integrated within your app. A successful strategy is to offer a free version of your app with advertising and offer users the option to remove the ads by upgrading to a paid app version. An easy way to do this is to tap into the services of a mobile advertising network like InMobi. In addition to handling effective integration of ads, they can also ensure that the advertising is delivered with the right ad experience for your app users.

3.     IN-APP PURCHASES

Your app may be free yet you can make money by providing and charging for special features or content, subscriptions and bonus offerings that can be purchased directly through the app.  Make sure that your app is set up to facilitate easy payment and delivery of purchased products. An easy an effortless integrated experience increases the opportunity for continued purchases.

Launching an app is hard work and real success is limited to the few. In addition to gaining downloads and users, you need to maintain them. Statistics show that there is often a drop off after three months. App developers need to be persistent and woo their users. The dream payoff is to make a sale like SnapChat or WhatsApp. It only happens to a few, but it's not a bad vision to have in your rear view mirror.