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Advice from the guy with two #1 AppStore freemium games: how to adapt to a changing app market

Source | LinkedIn : By 

Eric Seufert is a partner at Heracles. He shares his expertise on analytics and freemium mobile products. Follow his reading list on Quibb.

 

Eric has had a long career in marketing and user acquisition, with a focus on the intersection between analytics and product, specifically as it relates to freemium mobile apps. Currently Partner at Heracles (his newly founded mobile marketing agency), he was previously VP of User Acquisition and Network Engagement at Rovio (the company that brought you Angry Birds), and Head of Marketing at gaming companies Wooga and Gray Area.

In the most recent episode of the What I Know Best podcast, we talked to Eric about the current state of mobile free-to-play games, what’s going on in the app stores, and why virality is so important.

The app gold rush is over

Marketing for mobile apps is harder — and more expensive — than ever. The total number of installs are down, app install and mobile ad prices are up, and indie game developers are having a hard time reaching new customers. “This difficulty is a reflection of the state of the app economy,” says Eric, “because it’s reached a saturation point.”

For a long time, mobile app developers were riding the coattails of Apple and Google’s market growth. As more and more of the world bought smartphones, they also started downloading apps for them. But now, smartphone sales have slowed, meaning app sales have slowed as well:

“In countries in the West, penetration is over a hundred percent, with many people owning multiple phones. That persona of someone buying their first smartphone and discovering apps for the first time — it just doesn’t exist. Smartphone sales now are based on replacement, and replacement cycles are growing longer because iPhones keep getting better. People have all the apps they need and they’re just not seeking out new apps to download.”

 

In the “old days,” when the iPhone and other smartphones were THE new platforms, it was fairly easy for new developers with lower quality apps to gain a serious amount of traction with relatively little work or money. It’s a common characteristic of new platforms. But as the smartphone platform has matured and stabilized, so have acquisition prices and strategies. Many of the early inefficiencies to be exploited no longer exist. Is this a bad thing?

“I don’t necessarily see it in terms of positive or negative,” says Eric. “It just is what it is – you adapt.” The app gold rush was not going to last forever, and now that the dust has settled, app developers are adapting to this new era — albeit one that Apple and Google still control.

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