Effective marketing in mobile apps

Consumers spend a large proportion of their time on their mobile devices. A study by Flurry analytics showed that in Q1 2012 daily smartphone app consumption rose to 77 minutes per day.

Flurry calculated that consumers spend an average of 94 minutes per day using mobile apps across both smartphones and tablets. With mobile devices attracting so much of consumers’ time, apps should clearly be an enormous source of revenue for companies and developers.

However, a recent study by ABI Research on user spending indicates otherwise. For one, the results showed that 70 percent of users spend either nothing or very little on their apps, while the top 3 percent of spenders account for a whopping 20 percent of the total spending.

This great inequality in spending could potentially pose a threat to revenue and developers should continue to try and figure out ways to persuade smaller spenders to make regular if not larger purchases. What do these spending patterns mean for marketers?

App downloads are booming and free apps remain popular. In-app ads, that appear as a banner on the top or bottom of the screen, or cover the screen entirely, largely subsidize developer costs. Just as with free-to-air radio, television, and print, consumers realize this and are will to bear the with advertising in order to experience a service for free.

The costs of developing an app are prohibitive and this means that that the app ecosystem needs advertising to stay afloat. With thousands of new apps being listed on the app stores every day, mobile marketers have plenty of opportunities.

So which categories of apps are the best at making money and driving revenue? Apps that are best at generating revenue seem to be utility and productivity apps that tend to be used for more for business purposes than personal ones.

Productivity apps have seen a 66 percent increase in terms of time spent per user as well. In terms of time spent per user photo and video sharing apps have recently gained the most traction leading to an 89 percent rise in time spent.

This sudden increase is probably attributable to the Instagram’s runaway success that led Facebook to acquire it.

Companies looking to test out mobile advertising need to work towards focused targeted advertising by advertising in apps that appeal to their goal audience, not being too obtrusive, and having a definite call to action in all their ads.

By focusing on a wider range of apps companies may run the risk of spreading their resources out too thin. 

Rohit Dadwal, Managing Director, Mobile Marketing Association Asia Pacific