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SAN FRANCISCO — So you’ve spent months (or years) building an amazing, one-of-its kind app that will make peoples’ lives better. But like the proverbial tree in the forest, it only matters if there are people around to experience it.
User acquisition one of the most complicated and frustrating performance indicators (KPIs). The mobile app market is noisy and competitive. Startups with small budgets can’t afford to spend hefty sums on comprehensive advertising campaigns, and even companies with marketing budgets don’t always know where to funnel their money. Attracting user attention, much less getting them to download and use with a product, is a challenge for businesses of all sizes.
Poshmark, HotelTonight, and Swiftkey are among the most successful mobile apps out, there with dedicated followings and active users. Executives from each of these companies spoke at MobileBeat 2013 today, sharing their experiences with capturing users.The panel was moderated by Peter Hamilton, the CEO of advertising analytics company HasOffers which helps companies measure the effectiveness of their advertising campaigns.
Poshmark is a mobile peer-to-peer marketplace for resale fashion. Its users are uploading $1 million in inventory each day and the site has a dedicated following of highly engaged “enthusiasts.” Poshmark cofounder and VP of merchandising Tracy Sun said that part of Poshmark’s success is due to the strength of its community. Women who use Poshmark encourage their friends to sign up as well, turning it into a makeshift social network as well as a source for shopping.
“Rather than focusing on one metric, we look at a suite of KPIs with leaders to champion these metrics to make sure we are keeping everything in balance,” Sun said. “We have a lot of pride in our product and community and try to reflect that value in our message.”
Poshmark throws “Posh parties,” themed feeds where people can submit their clothing for a certain amount of time. These parties see upward of 30,000 items, which drove Poshmark to release “showrooms,” feeds curated by a host. Then next step was to take these parties into the offline world. A Poshmark team traveled to 30 cities around the country holding events with local members and fashion folk. Sun said that while the company did not measure the returns on this initiatives, she has “faith” that the buzz and excitement surrounding the events created value.
Measurement, however, is a key component of understanding what it takes to acquire a user. Companies have to consider who their users are, what it takes to get them engaged, and where money is best spent.
Swiftkey is the No. 1 selling app on Android in the world and has a 4.5 rating based on 205,577 reviews. SwiftKey is an alternative keyboard for Android that uses semantic analysis and text prediction. Chief marketing officer Joe Braidwood said that SwiftKey ran a testAdMob campaign once and only got six conversions from the whole campaign, with over 200,000 impressions. He said rather than advertising, most of its traction came organically.
“Gaining recognition and being heard is the hardest challenge,” he said. “We have to explain to users that they can challenge the status quo — that they can actually change how they communicate on their phone.”
Same-day booking site HotelTonight does put money into advertising, but director of marketing Adam Grenier said it focuses more on quality than quantity when it comes to user acquisition. The company only makes money if travelers book a hotel room through the app, so it is more important to market the app to specific, niche customers that will use it consistently. This requires sophisticated technology and expertise.
“As a buyer, I want to know where I should actually be spending my money and how I manage it,” he said. “Everyone and their dog is coming out with a mobile demand side platform and remarketing solution today. There is a mess of people out there and none of them really do anything that great, money is being spent haphazardly.”
Data analytics are giving brands and startups greater insight into their user behavior, what works and what doesn’t. Marketing automation is one of the hottest sectors right now as companies realize that to remain competitive, they have to use all the tools available to understand and then act on user behavior. User acquisition is just the first step. Like dating, the real challenges come down the road.
VB's research team is studying mobile user acquisition...
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