Mobile Distribution Hack

Posted on November 19, 2012. Filed under: startups, venture capital |

So here’s what I was thinking about yesterday.  It is no secret that distribution in the mobile ecosystem is FUCKED.  I complain about it in tweets at least once a month.  No matter which way you slice it, getting people to download your app, even if your app is dope, is really freaking hard.  As was the case 24 months ago, today there are still very few channels by which you can acquire new customers.  The fact that “get featured in the app store” is the number one method for building a native user base is completely absurd. Even if you can get people to “share” in your app, a deep link into the app store just sucks. The drop off is huge. Signing in and installing something before a user gets any value is completely contrary to the way users have become accustomed to acting on the web.  It’s the equivalent of forcing registration in a web app before delivering any value to the user. Imagine if Yelp made you register before you got to read reviews on their site…just doesn’t work.  There is this big step in the funnel from when a user is exposed to a brand to when they commit to it that is simply missing from the native mobile ecosystem.  It’s so bad, that if I had a mobile app that I was trying to spread, I would drive recipients of any share experience to a web based UX where they could interact with my application in a non-native environment…I’d try to win them there…and then attempt to convert my web users to native mobile users down the line…

Anyway, these problems got me thinking…if everyone gets a small install base out of the gate, and then struggles to grow it organically or socially the way they would a web app, that must mean there are A TON of “walking dead” apps.  You’ve heard of “walking dead VC’s” that still exist and have a brand but don’t do anything and don’t die…”walking dead apps” are apps that have install bases of between 10,000 and 100,000 but no growth and declining engagement.  These apps will never be meaningful companies, will never make any money, and at some point I’d imagine they just disappear.  BUT, one thing walking dead apps have is a footprint…small but valuable real estate on a user’s phone.  Granted the user probably doesn’t engage with their app, but they probably haven’t deleted it either…so how much is that footprint worth?  Well…if apps like Groupon or Zynga are willing to pay $5 an install, that would mean a crappy app with 10K downloads is sitting on $50,000 in IOS real estate.  What if…theoretically, there were a way for GRPN to buy “crappy app” for $2 an installed user, replace crappy app client side code with GRPN client side code in an “update”, send an email or push from crappy app to userbase saying “crappy app is now GRPN, check out the app already on your phone”…and then GRPN converts some % of crappy app’s users to GRPN mobile installed users?  I realize the mechanics of this sound ugly…but if someone were to come along and buy lots of crappy apps, put them together in one network, build a large installed footprint, and then sell the real estate plus “services to facilitate and optimize transition/conversion” from crappy apps to “buyer’s apps” …that might be kind of interesting…or better yet, what if someone built a marketplace where crappy apps could list themselves, there install bases, their recent active user base, and there category…and buyers could come along and intead of buying ads inside mobile apps that drive to deep links, they could buy blocks of installed real estate on mobile devices…then crappy apps would have someplace to monetize their now worthless apps, which would lead to more apps being built, which would be good for the ecosystem and Apple actually, and successful apps would have a channel where they could spend $ to effectively acquire IOS real estate.  I realize there are tons of problems with this (Apple’s hissy fit being the primary)…but I’m interested in the idea of fledgling native apps selling installed real estate instead of adspace within their apps.  Give em’ a performance based kicker on successful transition of installed base to “buyer’s app,” unlock more value for those who have been punished by the distribution wall of death…just a rant born out of frustration with the state of the state

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9 Responses to “Mobile Distribution Hack”

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Where is my assist? :)

There’s already a precedent for buying space on the mobile desktop, and it monetizes quite well. On Android, there is a permission that let’s app install shortcuts on people’s phones. Some of the “less savory” ad networks are taking advantage of the situation. They sell on CPI basis and the installs have 20% CTR. See Icon Ads: http://www.airpush.com/developers

One problem, users HATE it…

you don’t get an assist when i tell you an idea and you listen to it ;)

“What if…theoretically, there were a way for GRPN to buy “crappy app” for $2 an installed user, replace crappy app client side code with GRPN client side code in an “update”, send an email or push from crappy app to userbase saying “crappy app is now GRPN, check out the app already on your phone”…and then GRPN converts some % of crappy app’s users to GRPN mobile installed users?”

You could do that on Android (probably), but Apple reviews all apps updates, so it’s unlikely to work for iOS because they will not let you make that.

Crappy app pushes emails to users. Let user opt in for some redeemable discount in the future. Give users option 1) opt in 2) by doing so you are signing as part of a group 3) let lawyers present and figure out if this petition allows the release (kind of like a class action) 4) pray 5) the threat alone may allow Apple to do it once or they fight. If they allowed they would change terms and conditions overnight b) if they fought this could spin into a nasty legal battle where android and OEM’s could hang Apple about how you get lack of choice. That 1984 commercial becomes unhinged in 2013.

The only way to pull this off is to do a massive landgrab all at once.

Random late night response

Jordan,

Check out http://www.apptopia.com/ (full disclosure I am an investor). Seems similar to the marketplace idea that you are discussing. Also, there are a few new service platforms out there that let you port your app into a non-native web based UX environment to try it out. They are potentially helping the other problem that you were discussing as well. I don’t know anything about this company beyond seeing it once but check out http://kickfolio.com/.

Zach

Apptopia.com is probably the most direct way to accomplish this. A friend of mine sold an app through them around a month ago so evidently there are people willing to buy. I can’t imagine anyone paying $50k for an app w/ 10k DLs though. I think part of the issue is your numbers are a bit off when it comes to average CPI/CPI numbers. $5/install is very generous. Additionally, the value of an app would be more focused on a price per active install on GP or active user numbers based on the data based on info from an installed analytics platform. No value in the part of your user base that has already downloaded and deleted your app aside from establishing proof of concept as to the marketability of the app.

Awesome idea. I agree that mobile distribution is terribly broken, and using mobile real estate is a really interesting approach.

My concern is that while it would be help well-intentioned app makers, it could be taken advantage of to the detriment of the app ecosystem since it’s a slippery slope to spam – i.e. wealthy-but-obnoxious company buys real estate from fledgling app, spams users with push notifications/email, annoyed users delete app. If spamming became common, users would get paranoid that their “walking dead” apps could suddenly turn into spam engines and delete them preemptively. But perhaps I’m just being paranoid myself.

Hi jordan

This is ouriel from… appsfire :)

In doubt a crappy app installed on a device is worth anything at all if not used. Most crappy apps are pure dead and even if their push token is active the responsiveness to push is sooo.. bad (insisting on sooooo) that it s not even worth paying 1 cent for them. So, nice model but in the reality of push and usage metrics it just can’t work. A crappy app is a crappy app.

The reality is that it is hard for most apps out there because they buy any crap mark marketing campaign they are offered , build sub par apps not even worth downloading and spend time creating useless features rather than marketing their app intelligently and efficiently eg using analytics CRM and funnel tools. There are enough apps being successful right to land to the conclusion this is possible. And not impossible even for new comers. Many examples each months

By the way buying a crap app is also a bad idea because by doing so you lose all the push tokens you collected once placed under your Dev account.

Meaning you start from zero again. Meaning that you wasted money

So there is certainly another model to think about it but not by buying crapping apps. But by building not so crappy apps, network.

Oriel – Don’t forget that the platform bias at AppsFire is not representative of the general mobile market, there is a whole out there on android ;). The issue with push token transfer only applies to iOS, but it is certainly a consideration in those cases. This is especially true as I suspect many of these low quality apps will not have established push notification authorization for many/most of their users. Regarding the device push token issue, it only applies to the iOS APN protocol and not to push via GCM. There are definitely a few work around options on iOS if you get creative, both on the account side with Apple and client side, but they’d probably stop working if I posted them here.


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    About

    I’m a NYC based entrepreneur. I think there is one metric that can be used to measure the value of a human life and that’s impact. How did you change things? How many people did you touch? How different is the world because you lived in it and how positive was the change that you affected? (p.s. i don’t use spell check…deal with it) You can email me at Jordan.Cooper@gmail.com

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