My day job brings me the good fortune of working with the majority of the top-grossing app developers. For the AppNation conference in San Francisco earlier this month, I was asked to organize and moderate a panel, “Rants From Top Grossing App Developers.” The panel consisted of Giordano Bruno Contestabile (EA/PopCap Games), Cat Silvestre (DeNA/ngmoco), Daniel Pfeiffer (FunMobility), Jamil Moledina (Funzio), and me.

Rants from top-grossing developers might seem odd. As Jamil pointed out, why would a top-grossing app developer complain since it is, by definition, generating the most revenue? Therefore, included in my highlights are a few anti-rants.

Mirage of cross-platform. Giordano pointed out that the promise of cross-platform app development was talked about for 10 years, and we are still not there yet. From Jamil’s perspective, we are seeing some progress as interfaces and monetization solutions are becoming more consistent across platforms.

Fragmentation is still an issue. From their experience working with feature phone apps pre-iPhone, Giordano and Cat both agreed that fragmentation issues have subsided a bit. With that said, fragmentation issues are still prevalent, and we aren’t just talking Android. During Funzio’s recently released hit iOS game, Modern War, Jamil said his team spent several sleepless nights working through fragmentation issues with older iPod touch devices.

People problems caused by the bubble. Daniel said it’s difficult to hire good talent at a reasonable price due to unrealistic expectations versus the value and impact an employee brings to an organization. From my perspective, the trouble with talent acquisition largely stems from so many venture-funded mobile app companies. I’m reminded of the dot-com bubble, and how that impacted the early growth of my company. Daniel believes that a lot of dumb money is pouring into inexperienced startups with thoroughly unprofitable app concepts. Jamil disagrees, however, that we’re in a bubble. He believes investments are generally rational given how big the mobile app space will be. From a hiring perspective, Jamil said the problem is not just hiring developers. The greatest issue, he said, is hiring top-notch artists.

Randomness of smartphone store policies. Daniel expressed frustration over the randomness of smartphone store operators’ policies including their procedures and enforcement thereof. For example, Daniel cited the recent approval by Apple of Big Fish’s use of subscription billing in a game, which was only days later rejected. Also, Apple forbade the use of incentivized app downloads in April 2011, even though our company’s research shows that users who receive incentives can be highly engaged.

More intelligent ways to drive user acquisition are needed. While pleased they can generally target by country, Jamil would like to see mobile ad networks support demographic targeting.

Got a rant or anti-rant of your own? Please share in the comments.

Rob Weber, Senior Vice President of Mobile Business Development and Co-Founder, W3i, LLC
Rob is an Internet marketing pioneer with over ten, profitable years evolving W3i in the consumer application industry.

W3i had a rockin’ year in 2011–doubling sales.  You could say…W3i’s on Fire!  Thanks to all our partners, employees and the tech community in the Twin Cities, San Francisco and St. Cloud.  We couldn’t have done it without you.

Team W3i

I just returned from the GDC Online (Game Developers Conference) in Austin, TX, and found many of the sessions focused on data and how to use it to grow an app business. This is a subject dear to my heart, as it has helped my company grow our business over the years. For example, in 2004 we created our first business intelligence system and grew the business by more than 400 percent. (Making all the employees quite happy, as they won a trip to the Florida Keys.) Here are some examples of how you can use your data for actionable insights that will have a major impact on your app business.

Optimizing Images for Huge Performance Improvements

It is very important to test and optimize images. Our game investment company, Recharge Studios recently optimized an image in My Pet Zombie that increased the click-through rate (CTR) from 6.6 percent to 32 percent. Just by testing and optimizing the creative, 4.8 times more users clicked the image.

Optimizing the Tutorial Reduced Churn

Not many developers think of optimizing their tutorial. The new iOS game called My Pet Zombie from Riptide Games had a huge churn rate during the game tutorial prior to optimization. By optimizing the tutorial and improving the user interface, My Pet Zombie reduced the churn from 41 percent completion rate to 81 percent completion rate – a 98 percent improvement.

Improving just one particular image in the tutorial saw the churn rate go from 25 percent to 4 percent. The developer focused on the elements circled in pink.

Distribute Through Multiple Channels and Measure the Results

Not all app developers believe in paying for distribution. However, buying the right traffic and knowing the return can have a major impact on scaling your business. By knowing the return on investment (ROI) for each source of distribution, you can make smart buying decisions, but you need to experiment and understand the data. Also, some of the more expensive channels may have the most qualified users and can prove to be your best source of traffic, but you will never know unless you look at the data.

On the left side are various sources of traffic, and on the right side are the user retention rates after 30 days. As you can see, there was a lot of variance in the traffic sources. Once you know what traffic has the best ROI, it is a pretty easy business decision to buy more of that traffic. If you are interested in more information, check out my blog article.

Offer Users More Than One Revenue Stream

Only around 5 percent of users are willing to pay for an app or make an in-app purchase. By adopting an incented purchase model – offering users virtual currency for installing another app, for example – app revenue can more than double.

In this game, Dolphin Play, the user is offered Dolphin Bucks for installing Tap Fish 2.

In a recent case study using the incented, offerwall system, My Pet Zombie’s average revenue per user (ARPU) increased by 131 percent.

Do I have you convinced that to grow your app business, testing and optimization is important? (It’s almost as fun as playing the game itself.) Getting actionable insight from your app stats can turn an unprofitable app into a profitable app. Are there other tests you performed that made a major impact on your revenue? If so, please share the data in the comment section.

Rob Weber, Senior Vice President of Mobile Business Development and Co-Founder, W3i, LLC
Rob is an Internet marketing pioneer with over ten, profitable years evolving W3i in the consumer application industry.

Often times, marketers focus solely on getting their product installed by as many users as possible. Although high numbers of product installs are important, retaining users may be more valuable in the long run. W3i understands the importance of user retention and has a few different ways of finding the right user for your product using InstallIQ℠, the installation manager for smart software distribution.

One way W3i assists their clients with finding valuable users is through the Affiliate Feedback System (AFS). AFS is an optimization tool that gathers information on users’ computers compatibility that would show preponderance for an advertiser’s application. To implement AFS, W3i provides the advertiser with a unique ID for each install. The advertiser then relays performance data back to W3i for each ID. W3i uses this data to find common characteristics (similar traffic sources, browser versions, operating systems, etc.) among users and then recommends users for the advertiser’s application based on where the application performs the best.  Now that’s smart software distribution.

Another source that W3i uses to gain insight on users is the InstallIQ Updater (IQU). IQU is a resident application that provides users with an enhanced download and software usage experience. The benefit of IQU is that it tracks statistics for both installs and uninstalls, which can then be used to understand attrition, create a better user experience, and add insight into issues with installs/uninstalls.

W3i also allows full customization with the thank you page. The thank you page is the first experience users have with your product and W3i sees the value in giving clients the ability to customize it so as to see the most impact. A few ways a thank you page can be used is for remarketing, additional product information, or confirmation that the product has been installed.

How great would it be to make more money from each install? W3i has spent considerable time finding solutions to help clients make the most out of each install using InstallIQ.  When are you going to start capitalizing on smart software distribution by becoming part of the W3i Application Network?

Jessie Golombiecki, Marketing Specialist, W3i, LLC
Jessie uses her experience in internet marketing, graphic design, and testing to lead the charge in marketing management optimizing all touch points with consumers.

W3i Improves Ad Revenues with the Yahoo! Toolbar 

W3i searched for a way to offer consumers more value and to increase revenues through its free and trial computer applications.  The Yahoo! Publisher Network helped it do both by adding the Yahoo! Toolbar to W3i’s application network to monetize search ads and by partnering with the company to optimize user experience. 

Yahoo’s Full Case Study

There are many options available for building desktop applications; however, before you start there are three things you must consider. First, decide whether to build a cross-platform application or target a specific operating system. Next, choose the development tools to build your application. Finally, select an installation technology to deliver your application. Each of these decisions depends on a number of factors including your target audience, the type of application that you are building, and the distribution method that you plan to use.

In choosing a development tool, first consider the platforms (operating systems) on which your application must run. The top three operating systems are:  Windows, Mac and Linux. If you want your application to run on more than one of these, you should consider using tools that provide cross-platform capabilities, such as Eclipse, Flash and Adobe AIR. These types of tools can speed development and give you a larger audience. However, they can also add significant overhead in terms of distribution size, and may affect performance. Carefully examine the run-time requirements of the development tools you choose to determine the impact on the performance of your application and the ability to distribute it. Consider your distribution method—if users are downloading your application then size and dependence on additional components is a concern, whereas if you are going distribute your application on a CD or similar media, then size is generally of little concern. Also, review the run-time requirements of your development tool. You will most likely need to distribute extra software or require your users to download and install additional components. Some tools allow you to bundle these components with your application, but others may require a separate download from their site, which can complicate your installation process.

A more traditional approach to application development is to use a programming language such as C++, Pascal, or Java. This method requires a higher level of technical skill, and your application will not be as readily platform independent, although platform independence is still achievable. There are many development tools available, such as Visual Studio, C++Builder, and CodeWarrior. The advantage with traditional development is that you can make smaller applications that are less dependent on other software or components. If you are targeting a single platform and have the technical resources, this is a very good option for building desktop applications.

With traditional development there are many frameworks and code libraries available to help speed your development time. Frameworks provide a structure to build on while hiding much of the complexities of the operating system. Libraries add additional functionality and simplify common tasks such as parsing XML files or manipulating images. Frameworks and libraries are great for reducing your work, but take care in choosing them because they typically add significant size and may require additional run-time components. Also pay careful attention to code quality, especially when using open-source or third party offerings. Some popular frameworks include MFC and .NET (Visual Studio) and VCL (C++Builder). SourceForge is an excellent source for obtaining open-source frameworks and code libraries.

Installers are a very important part of building desktop applications. It is the first thing your users see, so it is important that it looks professional and works properly. There are many good tools available, such as InstallShield, Advanced Installer and NSIS. Most tools produce a self-running executable and some can also produce MSI files which use the Windows Installer technology. A typical installation program has a wizard to walk the user through the installation steps. The wizard starts with a Welcome screen which typically displays a description of the application and a EULA (end user license agreement). Next, optional items are presented, the installation begins, and a progress bar is shown.  Your application should also include an uninstall option, typically located under Control Panel – Add/Remove Programs. All of the major installation tools provide these functions automatically.

Software developers are always looking for ways to monetize their offerings, and because the current trend is to distribute applications for free, it can be difficult to generate revenue from your products. W3i’s InstallIQ technology can help you earn revenue from your distribution by offering additional products during your installation process. Implementation is simple—InstallIQ manages the wizard process and runs your installation along with any optional products the user has also selected. To use the InstallIQ wrapper, you need a silent version of your installer, which most install tools can do with a simple command-line switch so there is no extra work involved.

Building desktop applications can be a daunting task, but there are many tools and resources available to help with this effort. You must plan carefully and assess your needs to ensure that you choose the right tools and platforms. When you are ready to distribute, the W3i Application Network, featuring InstallIQ technology, is a great way to recoup your development costs, especially if you are offering your application for free.

Bill Zitomer, Software Development Team Lead, W3i, LLC
Bill uses his over twenty years experience to build W3i’s core desktop products as well as back-end technologies.

Software distribution is always a problem that publishers face.  Unless you have a loyal audience that you can market to within your app to gain further distribution, it’s becoming exceedingly difficult to get noticed across all platforms–desktop, browser, social and mobile.  Consider these numbers: currently, there are roughly 12,000 add-on’s in the Firefox add-on gallery (AMO).  In the Android Marketplace, at the end of December 2009, there were 20,000+ apps.  At the end of January, Apple’s App Store had a staggering 140,000+ third party apps available!  The number of desktop apps is in the millions.  Just imagine how these numbers will swell this year alone.  How does a publisher get distribution in a pool so massive? 

Here’s the problem: app stores are not built for software distribution for all publishers.  Only a select few are able to rocket to the tops of the charts and capture users’ attention.  These sites suit the aggregators well as they capture both the short and long tail, but what if you’re at the end of the long tail?  There are many ways to combat this; publishers need to seek more proactive ways to improve discoverability.  At the same time, publishers need to take advantage of solutions, such as W3i’s InstallIQ, that are built around distribution for all.  InstallIQ recommends relevant apps to users when they install comparable applications.  If you’re a publisher and have an app, it’s important to get face time with users.  W3i has nearly 10 years of experience connecting people to applications; that’s what makes us unique – that is our job and mission.  App stores are great for scale, great for the aggregator; but W3i can do what the app stores can’t: provide a software distribution solution that puts your application directly in front of users, out of all the clutter.

Eric Montag, Product Manager, W3i, LLC
Eric is a Pragmatic Marketing Certified Product Manager and uses his experience in internet marketing to lead the charge in product research, planning, and execution from both a consumer and business standpoint.  

I read an article by Steve Smith for MinOnline this week titled, “Vanity Fair Gets Social With Oscar Race iPhone App.”  This article discussed how Vanity Fair was going to capitalize on the Oscar buzz with its Vanity Fair Hollywood Oscar Race iPhone App and how L’Oreal will be the sole sponsor.

This is an excellent approach to application marketing—tagging into major events that naturally get a lot of buzz by providing relevant content and weaving in one sponsor.   This approach gives that sponsor more prominence since there is less advertising clutter. 

The W3i Application Network can be viewed this way as well.  Consumer application marketers with demand for their content sponsor consumer applications during the installation process.  This allows advertiser prominence when the consumer is already installing an application.

The article also discussed another problem with consumer application marketing, namely getting consumers to actually use the app once installed.  Vanity Fair tries to solve this problem using several messaging features:  pop-up instructions when the application is installed to orient the consumer with the app’s functionality and a headline crawl on the bottom of the app to showcase additional content.  Vanity Fair also built in the important “sharing” feature to ignite viral distribution by creating voting pools with groups.  These are excellent consumer application marketing tactics.

To excel at consumer application marketing not only does the app need to get installed, but it must also engage the user.  Providing timely content, ways to discover content and navigation tips are essential for an application’s success.  

Deborah Manthei, Director of Marketing Communications, W3i, evangelizing the use of consumer application marketing to engage brands’ essential users.

What separates an app rock star, from an app hobbyist? An app rock star understands the power of distribution, whereas, an app hobbyist creates an app based on personal preference, without a clear app distribution strategy.

Do you want to be an app rock star? If so, consider the following proven guerilla and paid application discovery tips when formulating your app marketing strategy:

Guerilla tactics: If you don’t have a revenue model, but want to get your cool consumer app widely discovered, here are a few tips on how you can get distribution:

1. Search Engine Optimization (SEO)- Organic search engine marketing is competitive for blockbuster keyword terms. Focus on a wider, niche-buster strategy to break through the clutter
   • Search Tips and SEO
2. PR/Social Media- Facebook and Twitter have millions of users. Make it easy for your apps biggest fans to start recommending your app to their friends
   • Some good stuff came out of VentureBeat’s DiscoveryBeat conference a week ago
3. App Galleries/App Stores/Directories- Whether you have an iPhone app and are publishing it to their store, a Firefox add-on on AMO(http://addons.mozilla.org), or a Windows app and published on a download library like Download.com (see Upload.com to submit your app).  There are many free sites where you can submit your app for a free listing.
   • Don’t Overlook Software Libraries, like download.com, as a Consumer Software Tactic

The main limitation with guerilla marketing is the lack of predictability, and the lack of scale. Most app marketers cannot get to a meaningful scale through a purely guerilla model.

Paid tactics: If you have a revenue model, it is easier to get scale fast.  There are a few additional options for you:

1. Paid Search Advertising: By far the most dominant way to market an application. Watch out though, keyword prices can be very competitive these days. Make sure you have a good landing page so your quality score is high.
2. OEM/Bundle Marketing Partnerships: There are bundle network solutions like the W3i Application Network that can get you very wide distribution fast. If you have a large budget, you can try cutting a direct deal with hardware manufacturers.
   • Wildtangent
     • Wildtangent became an immediate force in the casual game world because of the huge distribution agreements they signed
   • Yahoo, Microsoft Bing, HP/Ace
     • Lots has been said about Microsoft stealing the HP and Acer toolbar distribution deals from Yahoo
   • Hard drive/back-up drives and back-up software
     • Carbonite with Seagate
     • Similarly, Memeo with Western Digital 
   • Cisco thought so much about consumer app Network Magic that they bought out its parent company Pure Digital for many millions of dollars
3. Display Ads: Not as effective as they once were, but may be an opportunity. For display ads to be effective, your app needs to be supported by most platforms, otherwise you’ll end up with a bunch of users who can’t use your app anyway.
   • Optimizing Banners
4. Pay-per-download (PPD) advertising: Many of the download libraries, like CNET’s Upload.com service that manages listings on Download.com, provide pay-per-download advertising.
   • Don’t Overlook Software Libraries, like download.com, as a Consumer Software Tactic
5. Television & Radio Advertising: It might sound a little odd to many of you online marketers, but I have heard many consumer app marketers say that television and radio spots were very effective at driving web traffic.
   • Ascentive, Xeriton, and Carbonite all do radio and/or television
     • Television
       •  Carbonite                                                                                                                         
       • Ascentive’s FinallyFast.com
       • Norton 360
       • Windows I’m a PC
       • Apple series of “App For Everything” ads
         • I can’t confirm this one, but I heard at a recent conference that Apple maintains a schedule for the apps it will feature in its “App for Everything” television campaign, and they provide placement in the commercial as an extra incentive for certain iPhone app developers to meet their target release date
       • Parody- Florida/Key West travel bureau spoofed it
     • Radio
       • Carbonite- article about their use of radio
     • Retail
       • I would say don’t even bother with brick and mortar retail, but in certain app categories, you can probably get some traction.

Pick your partners wisely when it comes to paid advertising to support your application discovery. Most good channels allow you to try their model with low minimum commitments, and potentially work on a performance based pricing model.

Rob Weber, Vice President of Business Development and Co-Founder, W3i, LLC
Rob is an Internet marketing pioneer with over ten, profitable years evolving W3i in the consumer application industry.

To continue with my Add-on-Con buzz for marketers and developers of browser add-ons.  My last two postings recapped how browsers plan to lead all application platforms and the buzz on browser add-on business models.  In this post, I will cover the Add-On-Con buzz on add-on distribution channels. 

Add-On Distribution Channels

Browser galleries  

• Firefox’s gallery (AMO) is the leading source of distribution for most add-on developers.
• Firefox announced they do not have plans to have sponsored ads on AMO right now.
• Firefox revealed AMO’s install referrals come from these three primary sources – top ranked, recommended, and searched for
• Add-ons are by default sorted by popularity (cumulative installs) but will be updated to use # of active users.
• Alex Jeung, from Cooliris, mentioned that as a developer you can help your chances of getting recommended within the galleries by establishing your add-on’s popularity outside of the gallery and thereby proving that there is demand for your add-on.

Other distribution channels

• Check-out my earlier post to learn more about other add-on distribution channels including how the W3i Application Network is driving 850% more installs per application than AMO.

A special thanks to AdaptiveBlue, Yoono, and OneRiot for organizing Add-On-Con.  The excitement and anticipation I had leading up to the event were not let down.  I would invite others to participate in next year’s conference and follow their soon to be released blog. 

Please consider following W3i to stay up to date with other market information about add-ons as well as related services provided by W3i. (Twitter, LinkedIn,  Newsletter, Blog).

Ryan Weber, Vice President of Corporate Strategy and Co-Founder, W3i, LLC
Entrepreneur and pioneer of Internet marketing focusing on increasing revenue and distribution for digital downloads.