Liftoff has done its “Mobile App Engagement Index Report 2017”, where it talks about user relationships with mobile apps and how marketers must deal with this scenario.
Based on mobile app engagement rates, which according to the company “compare the average cost to acquire a new user in a paid app installation campaign, the company has focused on key participation events in entire funnel (Install Apps, In-App Purchases, Registrations, Reservations and Subscriptions).” The Index also highlights key similarities and differences compared to the previous year.
The application economy: a massively competitive market
According to the company, the application economy continues to be a monstrous and massively competitive market in which the large volume of applications that enter online each month, in fact, according to data from Pocketgamer.biz, in September is presented more than 11,000 app presentations on the App Store.
In addition, the value of the global application economy will be worth $6.3 trillion by 2021. That is, “Users and developers will offer equivalent growth in size to Japan’s economy,” the report says.
Faced with this competitive scenario, Liftoff highlights the current complexity in the face of great competitiveness and the difficulty of acquiring and retaining users, being the marketing task increasingly complex. One of the main advantages,
The good news is that today’s users can’t imagine a life without% apps, in fact, apps occupy 60 of total digital time, surpassing the time spent on mobile web browsing by a ratio of 7:1.
“Mobile apps have completely changed the digital media landscape in favor of mobile devices.”
The bad news is that users are more demanding, which puts a lot of pressure on the work done by the organizations.
According to Liftoff” significantly, CPAs (Cost per share) and engagement rates are stable, suggesting that advertisers who want to aim higher will have to dig deeper into the funnel. If the data obtained gives a greater distance, marketers will need to be more creative when trying to reach out to users.”
Marketing strategies can no longer be seasonal
Applications have changed users’ lives: the way they define and invest time, using applications as a means to get assistance, advice, and even access to both physical and digital goods and services.
In fact, users currently have what the report calls “micro-leisure,” i.e. people’s downtime is getting smaller, presenting these small bursts of daily activity that are normally invested with the smartphone. This presents an opportunity for marketers, being able to interact with them continuously, as long as the new marketing strategies are adapted to these “micromoments”.
Traditional advertising is displaced by this new scenario. The new advertising must be aimed at satisfying the user’s need to learn, do, find or buy something at that time, changing the advertising paradigm; going beyond seasonal thinking and orientation.
This is evidenced by the index that overlaps acquisition costs with conversion rates to identify areas of opportunity throughout the year – when marketers can get value for money. According to Liftoff, the correlation is not clear in many categories of apps, and the data show that scheduling this application spend of marketing campaigns in specific months or seasons is an increasingly outdated practice, requiring a change of mindset aimed at campaigns less attached to a specific schedule and more to the new management of the user’s leisure times, much more continuous.
Although it seems at first glance that the CPI (Consumer Price Index) of the cost of acquiring a user from one application vary significantly from month to month, there is only a standard deviation of $0.22, suggesting that acquisition costs , actually, they are quite stable.
One note to keep in mind is that user acquisition costs tend to increase during vacation periods and, in turn, in certain sectors such as video games, efforts to engage consumers increase during the holidays, as efforts to engage consumers increase during the holidays, as efforts to engage consumers during the holidays, as efforts to engage consumers during the holidays, as game companies are embroiled in great competition by those users who want to try the new devices as a result of Christmas gifts. However, according to the company, it is difficult to specify the periods where marketers get real value, but the conclusion does not vary: currently users are not governed by seasonality, but by their own times and schedules.
Increase the use of apps for travel or night out planning
The report uses multiple indexes, the first is the registration index, which shows the relationship between the cost of acquiring a user, which creates an account in the application, and the conversion rate—the percentage of users who complete this action. This action is not equally relevant in all categories, highlighting its importance in dating, travel or finance applications. Collecting a user’s key information can help the company in engagement campaigns, as well as creating a “social contract”. On the other hand, the booking index measures the cost of purchasing a user who, once the application is installed, continues its use by booking a flight, dinner, hotel or car-sharing service. The overall decrease in CPA is significant this year. During 2016, acquisition costs were significantly higher, indicating that many applications were trying to capture the attention of very few users. This year’s trend seems to be different, since, by presenting such a positive CPA, it indicates that either users have introduced the use of such applications into their daily lives, or that the user experience before was poor and has improved. The 2017 CPA stands out for the use of apps for travel planning or night out. This action seems to have become widespread among mobile app users.
“Marketing professionals can reduce efforts to educate users to use their apps to make reservations and apply double-click campaigns to ensure that users access their apps more frequently.” They’re recommended from Liftoff.
Apps have boosted online commerce
It cannot be ignored as the advancement of mobile devices and, consequently, the applications, have boosted online commerce. More and more consumers are using apps to make purchases, and this creates great competition between trading companies. For seasons, the holiday is the most outstanding in the use of applications of this type and, therefore, it is the critical period to acquire and retain users, in fact, the CPA begins to increase just before the holiday. Although it’s true that, with so many options to choose from, users are overwhelmed and complicates acquisition and loyalty strategies. The report also highlights that, during this year, it appears that mobile purchases in holiday periods will break records, just as it did during 2016. CPAs plummet by 48.2% during May and June, and continue like this during the summer. This season generates many “micro-moments”. Certainly, summer can be a crucial moment for engagement, for example, rising from 4.65% in July to 5.45% in August. Also the autumn months, such as September, which is usually related to innovation – for example, the latest developments from Apple in September – increases consumption and therefore the use of these applications and possible loyalty.
Commitment to subscription apps is fairly constant
Currently a user’s loyalty is a complex thing, but in the case of applications that involve subscription the loyalty of the users is more complicated and a privilege. These companies, having a predictable cash flow are able to acquire a higher degree of certainty and accuracy. However, considering the number of subscription applications that currently exist, it cannot be generalized. But, generally speaking, the commitment to subscription applications is fairly constant, possibly because of the user’s “need status”, rather than seasonal events. But regardless of seasonality, a campaign with effective targeting and appropriate messages can always influence users. Over the past year, the costs of this index peaked in March, at about $287.51, and during 2017 the cost peaked in September ($168.86).
“Are users more comfortable with the concept of subscription apps and therefore more open to committing to recurring costs? Or did marketers significantly improve the way they express the value your app offers in exchange for a monthly fee? We can’t know for sure. But the positive trend, coupled with lower costs, should encourage more app companies to embrace the subscription model and participate in the action.” Secure the report.
User acquisition costs have not changed much as last year
Users, regardless of gender, are increasingly using apps to do different things. For example, in booking applications, an average of 8.2% of women and 4.45% of men showed low loyalty rates. This year, the CPA for booking applications increased by 15.1% for women and 14% for men, while costs have remained unchanged.
In 2017 user acquisition costs have not changed much as last year – women: $56.58; men: $93.64 during 2016, while this year, women: $53.89, men: $91.25), yet engagement rates reach 8.5% for women and 4.4% for men.
The subscription commitment is much more complicated as seen above, and the higher price – although the data varies depending on the monthly fee. In addition, not all app categories have the same level of loyalty, dating and finance-related apps contain both higher participation and loyalty rates in men than in women – women – 2.6% and 1.8% respectively.. In addition, men have a lower CPA in this type of application ($158.27, while in women it amounts to $253.46).
iOS users have a higher CPA
According to the report’s results, iOS users have a higher CPA, but they are more participatory – perhaps because most of them are women. In general, iOS users outperform Android users in terms of loyalty. However, it varies depending on activities, for example, when you sign up for an app , which requires users to spend time and not cash – Android had 44% less to do it than iOS users. But, iOS users cost 14.5% less than Android users ($159.20, compared to $187.27), and conversion rates for iOS according to the report are more than double (3.5%).
By contrast, Liftoff reports a trend change, true that Apple’s App Store will continue to be the most lucrative app store, and will generate up to at least 2021$60.3 billion. But, merging Google Play and third-party Android stores could snatch the position from iOS.
“Android will surpass iOS in 2017, as the strong growth of the installed base of Android devices compensates for the low purchasing power of users,” the report says.
Some European countries will triple mobile payments by 2021
Among the developments that can be seen this year, the Index breaks down the data and metrics by different regions in order to enhance its usefulness among marketing professionals, facilitating the use that it may have among the strategies that are proposed develop and improve and expand its implementation over the next year.
This approach shows the different opportunities and challenges that different regions can pose, always taking into account in each of the cases the particularities they present. It could be seen, for example, how the growth of mobile applications in Latin America is very present in the market, but it will not be equated to the difficulties of users who are unable to make use of those applications by not being able to fully access, preventing the purchase in many cases. Another example would be the large implementation and use of applications in markets such as North American, where accessibility is not a problem.
In the retail market, applications show significant differences when comparing regions to each other. The Asia Pacific region always seems to have an audience prone to interaction with mobile apps, but the big challenge here is for the marketing departments, who face the challenge of creating real product fans among the audience. Generating loyal defenders is largely subject to the specific characteristics of each region, ensuring that each campaign is akin to the cultural sensitivities of each type of audience and that they are valued in different ways in different regions. Campaigns that show your apps using these concepts can make big profits, but they’re complex campaigns.
Obviously the sensitivities in Europe, Africa or Asia are very different and while in Asia user engagement with implementation may be more necessary, it does not have to be the same in the Middle East to donate market growth is a more important indicator.
On the other hand, regions must also be differentiated in terms of future potential in procurement. Some European countries, including Spain, will triple mobile payments by 2021. To date and as a general rule, buyers have shown little interest in making purchases through apps, something that will soon change.
