Revisiting Our 2014 Mobile Predictions

One year ago, we sat down with Ian Sefferman of MobileDevHQ and Ryan Morel of GameHouse to share our predictions for where mobile apps were headed in 2014. We predicted that 2014 would be the year of customer retention and engagement. We concluded that metrics around customer experience would rise in importance and become high priorities for customer-centric brands.

How well did we hit the mark on our mobile predictions? Check out our newest installment of App Marketing Conversations in the video below to see just how well reality measured up.

Interested in seeing our last year’s predictions for yourself? Check out what we had to say one year ago. We’d also recommend tuning into the GameHouse blog for the scoop rising acquisition costs, and what they mean for mobile engagement and retention in 2015.

Transcript:

Robi Ganguly: Good morning, welcome to another edition of App Marketing Conversations. I’m Robi Ganguly from Apptentive. As always, I’m joined by Ryan Morel of GameHouse and Ian Sefferman of MobileDevHQ by TUNE. So, we’re going to talk a little bit about last year’s prediction and judge whether or not we’re correct. Ryan’s already discussed the UA side of things. I’m going to talk about the loyalty side of things and then Ian’s going to talk to us a little bit about ASO. So, last year I said I was just going back awhile using the same prediction as 2013 which is that retention’s going to matter in a pretty meaningful way. I felt like it was going to be really important and that finally the companies wake up to it and really invest in a meaningful way.

A large part of our conversation discussed what that looks like and why that might not be true and what actions they might be taking around retention. So, for example Ryan you made some real good points about the fact that of course retentions are truly important and every company should invest but it’s kind of easier to expect the customers around user acquisition. In 2014, do you think that you saw companies spending easily but starting to invest more on the retention side of things?

Ryan Morel: Yes and I don’t really have a lot of firsthand experience here but I talk about kind of what I hear and sort of see. It seemed like 2014 was the year of people really starting to get really serious about reengagement which I think is maybe not directly parallel to retention and loyalty but it’s kind of like realization that oh my gosh, we should probably like pay attention to retention and loyalty because it’s so much easier to keep a customer than it is to get anyone of these good customers. Yeah, I think we start to see some of that, a lot of shift.

Robi: Yeah and it seemed like fix you in particularly starting to push a big narrative around acquiring loyal list and then what are you going to do afterwards too. So, I think that was part of what was also in the market from a conversation perspective. Then when we were talking about reengagement we also talk about tactics and the tools that companies are using in order to do this. I think in 2014, we can be comfortable saying retention was a bigger emphasis because push became bigger as a place for trying the engagement campaigns. Ian, you led a conversation with us talking about how at Amazon and email and marketing division you were thinking a lot about delivery and the cost of delivery and whether or not push providers are actually doing that kind of analysis. If the company is using that analysis so do you think you saw strides in being more relevant in the push?

Ian Sefferman: You know, I’m not sure that I actually saw a lot of companies really place a huge emphasis…. I guess I should take that back. Urban actually did put a big emphasis on doing push the right way. They have some tagline. Yeah, exactly, so that’s great. Personally as a consumer, I saw more apps going the right way with a few apps going off the deep end like crazy. I find that certain games are just incredibly push heavy to the point that I turn it off.

Ryan: Right.

Ian: But a lot of Apps that were pushing crap are no longer pushing crap, they are pushing interesting relative things for me.

Ryan: I would add one thing here that I still see at least from my perspective people doing it wrong from a permission’s perspective. I just download some the other day where I immediately opened it and you push notifications. I don’t know yet. [laughing] I think consumers especially just from time zero-sum game, they don’t know if they like it or not yet. I think there’s still a long of ways to go as far as developers asking at the right point to optimize in giving a good consumer to say yes.

Robi: Yeah, yeah. I think the broader point about retention and doing that is something that would become much more important in 2014. From what we saw, that conversation was a lot more common. A lot more companies asking question about how are we going to keep people around. We know we are actually making money mobile. It felt like 2014 for us was at least full of companies that had said we got our legs under us we know what it looks like in an app that’s useful used on a regular basis. We know that they are going to consume enough media that the advertising is worth it or that they are going to purchase it in some way so now we’re really in. We’re in this business, we’re invested and we’re running it so we’re not just running from the acquisition side we’re really growing from the LTV side. I heard a lot of propositions about LTV media in particular which makes me feel like I think we were pretty right about this prediction. How have you heard the conversation around LTV?

Ryan: Yeah. LTV, there’s a lot more conversation now about user acquisition based on LTV and not CPI than there was a year ago. So, a year ago it was really just a volume game, and there’s still some volumes but it’s really like how’s the LTV coming out. We see it with our customers like we’re going to we shift the CPI up or down based on what the LTV is doing on the back end. I have a question for you, which is this is also the year that we really heard a lot about like ecommerce on mobile is ginormous right, like 60% of Amazon holiday sales came from mobile or maybe it was 60% of their mobile sales came from an app, I can’t remember. Either way the numbers are huge. Which has to be driving people are going to pay attention to this.

Robi: Yeah. Yeah. I think if I understand your question correctly is the ecommerce shift to it leaning more of the LTV accounts because ecommerce companies have done by LTV for a long time. I think that is absolutely true. That is definitely a place where you talk to m-commerce companies or ecommerce companies that now have a big mobile presence, their math; their understanding of what it looks like to hit and retain the customer is much more sophisticated. I think the thing that we’ve been pleasantly surprised by is that the analysis from those companies is much more forgiven. In the mobile world a lot of the math has been driven by games companies.

Games companies tend to think about 3 days, 7 day, 30-day retention and a commerce company will say well we’re just trying to see if they’re active over a 6-month period. Because customers aren’t here all the time but when they come back and they make a choice, we want to see them. I’ve seen more sophistication around that. You guys do a lot of attribution tracking and see a ton of data at TUNE, are you seeing similar things?

Ian: Yep, absolutely. Almost nothing to add. I think everything that you’ve said we’ve seen. The one piece that I think is still missing is around the brand side. Brand side who may not ever really care about an LTV calculation, not clear to me that they’ve been particularly well suited in that ecosystem yet, as the ecosystem pushes toward LTV, where are they going to go and where are they going to fit in.

Robi: And when you say brand side, are you thinking like Proctor and Gamble?

Ian: Yeah. Coca Cola.

Robi: Coca Cola. There’s still trying to maybe figure out what’s the purpose of their apps and how does that get included in there…

Ian: That’s right.

Robi: …there LTV for their…

Ian: Exactly.

Robi: …for fundamentally an offline consumer.

Ian: Yeah. Exactly and what are they thinking about in terms of how are they allocating their advertisement budgets towards mobile campaigns. Because they’re doing it, right? Those guys have apps; they have things they are trying out and experimenting and they’re buying on. What’s its real purpose? Feels a little bit like the 1990s, 96, 97. Where those guys knew they needed a website but they had no idea what they’re going to do with it yet.

Robi: Yeah. And we’re starting to see several brands you mentioned or people that we know pretty well. We’re starting to see those folks say maybe it’s not something I should be thinking about right now as a modernization channel or that I can attribute like dollars to you but I do know that if I’m somebody’s pocket I can do interesting things with consumers that I’ve never done before. That’s part of the conversation we’re starting to see which is oh so us being on our phones mean we can actually communicate with them, we can learn from them and if you combine that with other things that we do the $150,000 market research study we do, the $10,000,000 test ad be buy over here we start having a better picture of the consumer and maybe that’s how we evaluate mobile right now on the brand side. So, I think that’s an interesting aspect it’s not really retention related as that notion.

Ryan: Oh, because we have an engagement and retention is kind of the same thing, right? So, while you were talking this is totally tangent but I’m noticing you were still wearing your watch.

Robi: Yes, my watch.

Ryan: So, I was thinking about whether or not wearables become a potentially more interesting medium for brands to engage consumers especially as they kind of move through the real world.

Robi: Yeah.

Ryan: And whether or not you’ve seen any examples personally like beacons effecting notifications or your location affecting notifications and your engagement with brands.

Robi: Well since I am on Android ecosystem, beacons don’t really apply to me unfortunately.

Ryan: They still have beacons.

Robi: Do we? I don’t know if really.

Ryan: iBeacons.

Robi: So, eye beacons. So, yes I guess that’s funny, I think about beacons being at this point. I haven’t seen any of that stuff like physical triggers kind of stuff off but I am seeing like on deck apps doing a better job getting you to like pay attention to certain things they are doing. Slack has a pretty nice notification that shows up on here and it’s relatively very convenient. I have been real happy with that. Google continues to set me in their ecosystem. I’m now like a Google Fit user on accident because of this thing. So that worked to their advantage pretty meaningfully. But I didn’t expect that at all. Maybe the other part I missed was this is a point you made towards the end of our predictions was if you’re going talk about retention, you’re going to talk about the quality of that. That at a certain level yes you can send out push, you can do app messaging, you can do feedback, you can do lots of things to reengage with the customers but if your app is no good…

Ryan: Doesn’t matter.

Robi: …doesn’t matter, right? And that was basically your point and you said I think this year around retention aspect some people are going to hit religion about the quality of their app first. I feel like that’s true, I feel like across the board the conversation is about what apps are good or what apps are not and what people are doing in order to invest has led to a massive tidal wave of if we’re doing it native, we’re finally just going native. How do you feel about the quality of apps and the emphasis on that?

Ryan: I think we kind of talked about this at our predictions for next year’s segment or it’s like there is no such things as a MVP at this point, at least you have to have, your MVP has to be really good or no one is going to care. So, I think it’s becoming clear everyday like quality level of polish, volume design kind of lines or that on Google are incredibly important to even have a remote shot of getting some users. I think that is only going to get more competitive as we go.

Robi: Yep.

Ryan: Did that answer your question?

Robi: Yep. No, it does. I mean, I personally right because we live in this. I’m biased. Everyone I talk to says yeah, we want to hear from our investors, we’re going to talk to them, our app has to get better and this is the best way for us to get better faster, it’s the best way for us to prioritize but we’re biased so I’m curious about what you are saying, are you hearing more conversations of quality? You work with some of the largest apps in the world.

Ian: Yeah, I mean to a certain extent in working with some of the largest apps in the world excuse our judgment too because those guys they are there because they are the quality and they are the best. But with that being said, that just points the needle in the exact direction that we are talking about. In order to be the best and to be the largest in the world, you have to have high quality. So, yes high quality is unequivocally important.

Ryan: I would say from a games’ perspective it’s harder today to start with a lower quality game and iterate rate to a higher quality game. Simply because of the cost of user requisition is so high. So, you can’t you’ve got to spend the time up front to make sure you have something of quality that people want or at least give you a starting point.

Robi: So Flappy Bird happened in 2014. Is Flappy Bird the exceptional cruiser role? Like, how do we think about that?

Ryan: I don’t know.

Robi: That was a crappy game, right?

Ian: I’m not convinced it was a crappy game actually.

Robi: That’s a fair.

Ryan: I can say it was a haunted service. So if you think of Clash of Clans and Candy Crush, etc, services so Flackin Bird was not that. It was a good game that filled a need…

Robi: Yes.

Ryan: …in a short period of time. But I think it proved that the power of word of mouth is still going to be strong. And that there is meritocracy in the gaming business.

Robi: Yeah. So I’m going to say wrapping this up. Last year’s predication around retention we did about 80%. I think we were right that it’s going to be a more emphasis, there’s clearly a lot more focus on LTV. I think that conversation around LTV will continue to explode this year but I think maybe we’re a little bit optimistic about everybody talking about the notion of talking to their customers and hearing from them. I think that more people are doing that, it wasn’t so universal. So we definitely made some predictions about this stuff for next year, be sure to check those out and check out the other recaps from Ryan and Ian and like this and share it. Thanks.

Hungry for more? Check out our mobile predictions for 2015!