When a new app publishes, it has to overcome the challenge of discoverability. In the iOS ecosystem alone, there are around two million different apps available in the App Store on any given day. And there’s a reason for this high volume: Apps are pretty lucrative, with total app revenues projected to top $75 billion by next year.
Relatively low barriers to entry allow for the possibility of being quickly discovered and earning coveted ad revenue. Consider the colossal success this year of Pokémon GO, which sent Nintendo’s stock skyrocketing on the back of 30 million daily active users at peak popularity. But if you don’t have Pikachu to hook nostalgic millennials, standing out can be tough. After all, more than 10,000 games are submitted for consideration to the iTunes App Store every single month.
Even narrowing it down to a single category doesn’t make the environment any less competitive; there are, for instance, more than 165,000 fitness apps in the App Store. So if you’re a marketer tasked with driving downloads for your run tracker app (which, like most options, is probably free to download and can’t rely on classic marketing levers like price) how do you hit your goals?
Enter mobile rewards marketing. The concept really began with incent, born out of the need to get apps discovered. Being found was the key driver of success when apps first became popular. The more downloads you have, the higher you rise in the ranks, and the more successful your app is considered. Incentivizing downloads and running a “burst” campaign became – and still is – a popular and extremely effective way to drive app discoverability, boost initial engagement, and increase organic installs.
As the app ecosystem evolved and matured, rewards marketing did, too. Marketers began leveraging rewards to solve not just the problem of discoverability, but to address the challenges around engagement as well.
Sports, gaming, and the spirit of competition
This desire to use rewards to improve engagement eventually led marketers to in-app competitions. Users who join competitions send a strong signal to marketers about their motivations. Smart marketers use this motivation to reinforce desired behavior and create repeatable habits within the app.
Competition brings out the best in us. While this platitude has been recited by everyone from athletes to economists, it remains not only true but relevant even to fields like marketing. Marketers would be remiss to overlook the psychology behind competition. Just as rewards — monetary and otherwise — have the power to drive a desired action, competition has the power to unlock a more intrinsic motivation in users. Studies have found that most people who play sports do so because the game itself is its own reward.
When we think of competition as a motivator, most of us will jump to athletics. Professional athletes are incentivized to perform by obscenely large paychecks, but most would agree that their willingness to participate in an often grueling, potentially dangerous competition stems from more deeply held psychological factors, rather than behavioral conditioning.
Thanks to technology, the genetically gifted aren’t the only ones who can play games professionally or satisfy that urge to compete. eSports, the soon-to-be nearly billion-dollar industry, now connects video game players across the globe by hosting competitive gaming tournaments. From Call of Duty to Madden, the best gamers can compete for prizes in competitions that are streamed to thousands of live viewers, just like any other professional sport. According to market intelligence firm Newzoo, more than 89 million people spend over 3.7 billion hours watching eSports every year. Deloitte has reported that more than 40,000 individuals attend live events, with tens of millions tuning in to watch online. More people will probably watch the upcoming Halo tournaments than did the last Cubs-Indians World Series game.
The app opportunity
Marketers are now realizing that it’s not just the Counter-Strikes and League of Legends of the world that are appropriate for a little friendly competition. Casual, mobile games are also looking to eSports to drive engagement. Take Doodle Jump, the wildly popular multiplayer game that announced its own eSports league this summer. Brands are increasingly bringing the fun of the massive eSports craze to the consumer, so they aren’t fighting against ads but instead participating in an immersive experience that ties right into the game. Anyone who has had to sidestep Pokémon GO players walking down the street realizes just how immersive competition can be. While all games can’t take advantage of augmented reality, embedding real competition — challenges for badges, recognition as a top player, etc. — is part of what made the game so difficult to put down, even in traffic. In fact, the first person to catch ‘em all was rewarded for their prowess with free trips across the globe from Marriott and Expedia — a real (expensive) prize for competing in a virtual world.
The secret is moving that spirit of competition and enthusiasm to the mobile world — before the consumer clicks through what is perceived as an intrusion.
Playing to win the game
Psychology has gone hand in hand with marketing since the ad men on Madison Avenue realized the power of pulling behavioral levers to incentivize a particular action. Before De Beers equated devotion and self-worth to gemstones through clever ad copy in the 1940s, there was no market for diamond engagement rings.
Today, marketers should focus less on spinning a product and more on how to align their goals with the behaviors that their customers already are engaging in. Basic rules of economics describe both incentives and competition as essential forces in driving an outcome. Marketers would do well to take some cues from economists and get their customers competing. The possibilities are endless. Imagine a tournament-driven McDonald’s Monopoly game on the phone, driving hundreds of thousands of users to the app each day to compete against each other for rewards. Or consider an annual international Candy Crush tournament that doles out huge prizes to competitors. MapMyRun, a fitness app that uses GPS and location tracking to log your run, already uses coupons as a reward for achieving certain goals, but one could imagine that runners would be even more likely to use the app if they had a chance to compete against friends and strangers. Maybe introducing a virtual 5K race, for example, where each user runs his or her own unique 3.1-mile course with the app tracking times — and rewarding the top finishers — could inspire more sustained engagement with the app.
Just as marketing evolved along with mobile technology to solve the problem of discoverability in an oversaturated market, it is now evolving to address the need for engagement. By aligning with the natural preferences, motivations, and even instincts of consumers, apps have a fighting chance of becoming the next big thing. Intrusion and obstruction will only serve to repel users, so it’s imperative that app marketers create an experience that feels intuitive, unobtrusive, and fun. Marketers who recognize that the tide is turning and invest accordingly are sure to stand out from the competition.
Spencer Scott is the CEO and founder of Meed, a mobile rewards platform dedicated to helping brands grow and engage their audiences and acquire high-quality users. Having spent more than 20 years in tech, he has helped app marketers drive hundreds of thousands of installs and led teams that drove more unique U.S. traffic than any other incentivized ad network. An active advisory board member of Yesware, he has also served on the board of companies acquired by Facebook and Groupon. He is considered a prominent thought leader in the ad tech space, having spoken at events including Digiday, ad:tech, Casual Connect and more. Spencer previously served as the CEO of FreeMyApps, the world’s largest mobile app and game discovery network, which will continue to operate as a Meed offering.