Mobile Dating Steers Publishers & App Developers To Monetization

Mobile Dating Steers Publishers & App Developers To Monetization

By Amy Vale

Finding love and romance isn’t always easy, especially in a world where people live on-the-go and are always rushing to the next activity with multiple devices in their hands. It’s this very rushed style of dating that’s driven the huge surge in popularity of online dating sites. And that popularity is moving to the small screen too, as mobile dating is on pace to overtake online dating as the preferred channel for finding love around the world. Statistics now say that 80% of single people prefer mobile dating apps over online dating sites. If that isn’t proof enough, a Snap Interactive survey of 50,000 people found that four out of five single people prefer using Smartphones to get dates, compared to online dating sites. With the number of mobile users worldwide rising at a pace faster than we could imagine, how can publishers and app developers monetize the high traffic of mobile users searching for love on-the-go?

According to a New York Times article, mobile dating apps are fast becoming the favored method of finding love due in large part to the ease of use and immediacy offered by location-based targeting capabilities. Essentially, users can flirt and set up dates at a much faster rate on their mobile devices. With the added benefit of “instant dating,” these app users can find someone with similar interests who is nearby instantly. So how can publishers and app developers prevent their dating apps and mobile sites from becoming a one-hit wonder and generate consistent streams of revenue from them?

Since a growing number of mobile dating sites and apps leverage location-based features, using geo-location targeting in the mobile ads and in-app ads has tremendous value because they fill the instant and local needs of mobile daters. In late 2011, the hugely popular online dating site OKCupid delved into the mobile world with its ‘OKCupid Locals’ app. The dating site’s bid to monetize with mobile is a very smart move, and exactly the type of mobile move analyst Mary Meeker would approve of. OKCupid Locals has found that a tenth of its 2.5 million active members use the location features within the mobile app. Given these high numbers, location-based targeting will make mobile ads a lucrative business for publishers and app developers. Imagine a thirty-something female professional sitting at a local coffee shop on a Saturday afternoon, idly browsing through the OKCupid Locals app on her Smartphone. Geo-location targeting ensures that the mobile ads served within the app on her Smartphone are geographically relevant to her. When it comes to dating, the more relevant and targeted these ads are (whether on a mobile-optimized dating site or app), the greater the likelihood of converting mobile site visits into a consistent source of revenue.

Another way to monetize these dating apps and make them stand out from the pack is the Freemium model, whereby it’s free to download an app initially and a healthy portion of revenue comes from in-app purchases. According to IHS iSuppli’s market intelligence, revenue from in-app purchases is expected to increase to $5.6 billion in 2015, up from $970 million in 2011, and will account for 64% of total market revenue. To make the case for in-app purchases in the world of love and flirting, let’s look at one app that’s monetizing a bit differently from other socially-driven apps like Instagram, Pinterest and Tumblr. Skout boasts some pretty serious engagement numbers asthe dating app supports 300 million messages a month,  its average user checks in about 8 to 9 times a day and it’s signing up about one million users each month. Instead of using mobile ads, Skout’s mobile revenue stream comes in large part from in-app purchases. Essentially, Skout app users can purchase “points” which can be used in a number of ways, including sending virtual gifts, seeing who is viewing their profile and sending “wink bombs.”

Clearly, mobile dating is gaining favor with consumers around the world. And the benefits of finding instant, local love on the small screen aren’t only confined to daters; there’s plenty of revenue to be made long-term following the route of in-app ads and in-app purchases.

The Monetization Rush For Mobile Payment Apps

By Amy Vale

As people trade in their older, clunkier mobile phones for sleeker, more advanced Smartphones and tablets, the number of benefits to their lives increase exponentially. That can be said for the mobile shopping experience, with the percentage of mobile shoppers who are Smartphone users jumping from 75% in 2010 to 93% in 2011. With this up shift in mobile use, so does the need for retailers to create a seamless shopping experience for their customers, both offline and online. As retailers rush to adopt mobile-first strategies, we’ll likely see the release of more mobile payment apps to cut down on time shoppers spend waiting in line at their stores, much like the one launched by Carphone Warehouse last week. But how (well) will publishers and app developers cash in on these mobile payment apps?

We already know that consumers aren’t as frustrated or averse to seeing mobile ads, as we once thought. In fact, the Interactive Advertising Bureau reports that 76% of mobile commerce users used their mobile devices in the retail store, and 22% of mobile commerce interactions were driven by a mobile ad. To monetize mobile payment apps, it’s not enough for publishers and app developers to simply make the decision to develop in-app ads. If publishers and app developers want to see those ads drive a significant portion of overall revenue, they must embody, respect and enhance the overall user experience. And that may very well mean abandoning banner ads and pre-roll. Instead, in-app ads for these mobile payment apps must tell a visually interactive, compelling and relevant message to users. For instance, if a regular JC Penney customer is using their Smartphone to play a gaming app, they’ll be more responsive (and interested) in interacting with an ad that says: “Interact with this JC Penney ad and receive 5 free power-ups.” What this means is that delivering the right in-app ad at the right time can effectively increase the number of clicks, impressions and revenue that publishers and app developers see. For mobile users, it’s a win-win situation because they not only get to enjoy playing the gaming app, but they’re given ads that are both interactive and relevant to their needs (super gaming users want more power-ups). For publishers and app developers, being strategic in the types of ads delivered to Smartphones and tablets will ensure greater ROI and revenue.

To top it off, just last week a group of 14 merchants including Wal-Mart Stores Inc., Best Buy and Target Corp. (calling themselves Merchant Customer Exchange, or MCX) announced plans to create a mobile payment app that would give some of their competitors a serious run for their money. In addition to creating a convenient and seamless shopping experience, the payment app plans to integrate ads offering personalized deals, promotions and coupons to customers.

The reality is that there is a systematic cultural shift happening in retail – consumers are coming to assume mobile, from full-featured apps to mobile websites, will be a large part of the shopping experience. It will not only assist shoppers in getting the right information, products and services before they arrive at brick-and-mortar stores, but these new technologies will also simplify and improve the in-store shopping experience tremendously. So the important lesson here is that publishers and app developers need to custom-build and design in-app ads that are innovative and interactive, without interrupting the overall user experience.

What Is The Future of Mobile Commerce?

By Amy Vale

The proliferation of mobile devices globally has changed the way consumers shop, both offline and online. No longer are brick-and-mortar shops the first point of contact in a shopper’s purchase cycle. They’re increasingly using mobile sites and dedicated apps to make better, more informed purchases. So the question remains – how can publishers and app developers capitalize on this opportunity?

One thing is for certain; in-app purchases can be a developer’s proven route to monetization. According to Business Insider’s Analysis of App Store Data, 93 percent of the top 100 grossing iPhone apps use in-app commerce. Of those 100 grossing apps, two-thirds are free-to-download apps. High-level or power users of apps are typically the ones making the majority of in-app purchases. And the more frequently and consistently these power users interact with an app (upwards of 10 app sessions), the more likely they are to make an in-app purchase. Take for example the largest Internet retailer, Amazon. It recently added in-app purchases as part of its larger mobile advertising strategy. This new feature will use Amazon’s one-click purchasing, letting consumers buy an item without having to exit the application they’re using. Keen to deliver more content for its Kindle Fire tablet (and compete with Apple’s iPad), each movie and book download made within the app will help Amazon make substantial revenue gains.

Another example of the monetization potential of in-app purchases is the Magic Piano by Smule app. It was first developed specifically for iPads as a pay-to-download app that costs $2.99. Months later, the iOS developer released a version for the iPhone, which was free-to-download and offered a few songs at the start. To ensure the app delivered consistent streams of mobile revenue, the iOS developer released additional songs every Wednesday from popular artists like Lady Gaga, Jason Mraz and Britney Spears – available as an in-app purchase using a special type of currency called Smoola. These Smoolas are sold in packs of 160, starting at $1.99, and tracks cost anywhere between 25 and 75 Smoolas each. We’ve already seen these types of in-app purchases prove to be huge revenue drivers for game makers like Zynga. Clearly, there is a very compelling business case for why more app developers should leverage in-app purchases to earn revenue from consumers.

Did you know that one in six Smartphone users in Europe access online retail sites and apps on their mobile devices? To top it off, one in eight Smartphone users in the EU5 countries actually completed a retail transaction on their phones, according to comScore. As recently as a few months ago, British supermarket chain Sainsbury’s put its mobile commerce strategy into motion with the launch of a mobile-optimized site that lets shoppers choose from over 200,000 grocery items to purchase using their phones. The newly launched mobile site was designed with a very specific goal in mind – to make customers’ lives easier and deliver a rich, useful shopping experience no matter where customers are when they decide to do grocery shopping. Given Forrester Research’s European Mobile Commerce Forecast, citing that mobile spending across Europe will grow to a whopping €19.2 billion (or 6.8% of online sales) in 2017, the potential to generate revenue from mobile site purchases is one that publishers cannot afford to ignore.

Clearly, the remarkable growth of apps and mobile sites has generated a number of different revenue models for publishers and app developers. But should we be worried that the success of gaming apps like Words With Friends and Draw Something (thanks to in-app purchases) is fleeting? What types of innovation are needed for publishers to monetize traffic on their mobile sites?

Hot Monetization Trends To Watch in 2013

By Amy Vale
Earlier this year, analyst Mary Meeker talked about the huge gap between time spent on mobile devices and the advertising dollars allocated to mobile. That represents a goldmine of opportunity for publishers and app developers. So we wanted to highlight some key mobile trends that show real monetization promise for 2013.

Mobile Integration

We, as consumers, are multi-taskers. We don’t just watch watch TV. We don’t just read a book. We don’t just play a game of Scrabble. We have multiple devices in our hands (and our bags) at all hours of the day and everywhere we are. We sit in front of the TV set, while simultaneously texting friends on our Smartphones, checking email on our laptop or desktop computer, and read the latest celebrity scandal on our tablet device. So it goes without saying that publishers and app developers must integrate mobile first into their overall advertising strategy (and allocate a significant portion of their advertising dollars into this channel).

To ensure that publishers and app developers capitalize on their mobile traffic and revenue, it’ll be important to cater the creative used in mobile ads to the channel specifically. That means not replicating the same creative used on a regular website and simply repurposing it to fit onto the smaller screens of Smartphones and tablets. For instance, iPad usage tends to be higher on weekends, while desktop is typically lower. It’s now thought that publishers who serve ads across more than three platforms will be 21 times more effective than those who focused on only one platform. Understand the complexities of the mobile channel, analyze and measure what’s working (and not working) and tailor your creative to maximize ad performance and ROI.

More Targeting

Who doesn’t want to see an ad at the right time, or in the right place? In the world of mobile advertising, one of the biggest keys to monetization is relevance – in other words, the ability to target and reach your audience in a way that matters. Some of the strongest parameters offered by publishers to deliver mobile ads have been location, day-parting and contextual keywords. Now, as we move into 2013, it will require publishers to strike a delicate balance and layer multiple targeting options without losing scale.

Social Media

Social networking has fundamentally altered the way users interact not only with their mobile devices, but also with ads. According to comScore, 45% of all Facebook traffic and 55% of all Twitter traffic comes from mobile. Recently, the Wall Street Journal reported that Twitter is beginning to see strong revenue growth by delivering ads across mobile devices. People who see a Twitter ad on their phones are more likely to click or interact with it in some way, which is how Twitter gets paid for advertisements. While there is speculation on why Twitter is seeing its mobile ads “click,” it will be interesting to see how social media will impact the effectiveness of, and revenue generated from, mobile ads. If you ask me, this is only the beginning for this trend.

Augmented Reality

Mobile augmented reality, also known as mobile AR, is still relatively new. But by 2015, Juniper Research predicts that globally there will be 950 million mobile handsets, over 50,000 mobile AR apps, and mass adoption of AR in ads and apps. It’s estimated that the mobile AR market will reach $732 million in 2014, fueled by pay-to-download apps, subscription services and advertising.

Recently, IBM launched an AR app for grocery stores that lets users pan the store’s shelves with their Smartphones to receive personalized product tips, recommendations and coupons. What’s smart and effective about a mobile AR app of this kind is its ability to close the gap between the in-store and online shopping experience. While mobile Augmented Reality may not offer a huge opportunity for monetization at scale, it can however, create a rich brand experience.