Monetize: Chapter 6 of The Math of the App Business
Monetize: Research and personalize
Research and understand your customer base more deeply
More downloads and more active users are certainly requirements for a successful app. The ultimate goal, for most app developers, however, is to make a business out of the app.
The key to getting smart about making a business out of your apps is to do research with your loyal app customers, to determine how you could expand your engagement with them through the creation of other apps they’d be interested in and to get more personalized. Some key questions are:
- What will people pay for in your app? Is it more content, additional levels, greater service or a specific product set?
- If you’re utilizing ads, do you know if your ad strategy is annoying people or is welcomed?
- What other associated apps can you build for your most loyal fans and app customers?
The emerging business models for apps are presenting us with new opportunities to build a business, but flying blind and guessing is a dangerous way to uncover the answers to your monetization questions. Instead of copying others or just throwing things against the wall with your customers, take a proactive approach to learning more about how you can succeed. Running targeted surveys to your customers is a great step to get smarter about customer needs.
Personalize your offerings based upon customer segments
The best apps are the ones that offer personalized experiences. The more deeply you understand the various segments of your customer base, the more you can tailor the paths which your customers take within your app. For example, some customers are more likely to make in-app purchases than others. Other customers are more likely to purchase paid versions of your apps in favor of not seeing ads. When your app is a gateway to your existing commerce channels, establishing differences in behavior and desire can ensure that the few moments a day a customer spends with your app are focused on the right products and services. Whether you’re selling virtual goods or real services, tailored presentations can be the difference between average revenues and extraordinary profits.
If you’ve created a customer database and understand the needs and desires of the segments, it’s much easier to program differing experiences. With sophisticated and targeted communications capabilities, it’s possible to capitalize on these differences and to match the results of your research to the capabilities you’ve built. The best apps provide distinct and personalized experiences.
Conclusion: Break down the app equation and build a business
As you build your apps and grow your business, make sure that you know the equation that impacts your success and are truly focused on every component of it. If you keep focused on maximizing your installs, retaining more them and better monetizing your audience, you’ll succeed over time. The equation might be simple, but the work is not. It requires continued investment, commitment and evaluation in order to move the needle each and every piece of the equation in order to build a sustainable app business. Fortunately, the number of potential app customers is growing dramatically every day, so the potential audience for your app, which is a number you can’t control, is growing rapidly every month.