iOS 10 just entered its first public beta last week. Now everyone - with or without an iOS Developer account - can experience the latest Cupertino has to offer, months before the final release gets pushed out to the masses.
But while most of the reactions to iOS 10 have been focused on rich push notifications, lock-screen enhancements, Siri, and iMessage extensions, there is one announcement that has gone largely ignored - Apple's new App Store Search Ads.
With Search Ads, apps will be able to pay to have their app show up at the top of App Store search results. This has huge implications for mobile marketers, as it means that organic acquisition is going to get much harder.
For years, organic app store searches have been an inexpensive baseline way to acquire users, spawning its own specialty, app store optimization (ASO), to help. Organic app store acquisition has been so effective that many smaller apps never even venture into paid acquisition and even larger apps with sophisticated marketing teams depend on the steady stream of organic users to keep their costs in check and their app businesses profitable. App Store Search Ads are poised to change the equation. We anticipate a new dynamic where you have to “pay to play” if you want to maintain a steady stream of new users.
The fallout from that will be a hit to apps’ growth rates. The cost to acquire each user will go up, so the number of users your budget can pay for will go down. That slowed growth and high cost of entry means it’s going to be hard for new apps to come in and play the role of disruptor.
Panicked yet? Don’t be! The picture may seem bleak for app marketers, but the good news is that you can minimize the impact of Search Ads by focusing on user engagement, retention, and LTV optimization. Better engagement and retention mean higher value per customer, which in turn means you’ll be able to afford paying increased costs while keeping a positive ROI. Apple is also giving us some exciting new tools in iOS 10 that will help. At WWDC 2016, several of the enhancements announced will empower app owners to drive deeper engagement outside of the app itself:
Rich push: Push notifications that can include custom-rendered UI, action buttons, etc. to make the notification more interactive.
Push attachments: Images, audio, video, and animated GIFs that can be shown in a rich push notification.
Lockscreen widgets: Interactive mini-apps that were introduced in iOS 8 and previously limited to the hard-to-find “Today” screen. iOS 10 gives them a new, highly visible location that's just a swipe away on the lockscreen.
New extensions: iMessage, Maps, and Siri have support for apps to include their own content inside Apple’s apps.
These have the potential to bring us into a new age of engagement reaching beyond the app itself.
Apps will have new and unique abilities to engage users - even if those users haven’t opened your app in months. And these new engagement tools can mean better retention and more value for each of your customers - which means increased ROI that allows you to up your paid acquisition efforts.
The old adage is “it takes money to make money.” In the App Store world of 2017, though, you might say “it takes engagement to make engagement.” Apps that don’t shift their focus to engaging and re-engaging their users will start to fall behind their competitors that do - and then they’ll fall behind on acquisition too.
The App Install Bidding Wars are coming and the winners will be the ones that can maximize their customer lifetime value so they can keep up with acquisition costs in a sustainable way. Whether that customer value is defined for you in terms of in-app purchases, ad revenue, or brand loyalty, the true currency underneath those metrics is “engagement.”
How do you focus on engagement? Starting to leverage those new iOS 10 features is only part of the battle. Notifications are going to get noisier with the new features. Literally noisier, with audio and video attachments, but it will also be harder to get your efforts to reach out to your customers noticed as the number of widgets, pushes, and local notifications rises.
The best way to cut through is to double down on relevancy - hit the right person at the right time and place with the right message. The core tenets here are personalization based on audience, location, and content as highlighted in the below examples:
We think iOS 10 is going to bring some really exciting changes to apps. App owners should be taking the next few months to do some soul searching and think deeply about some existential questions: What is my core value proposition, and how do I keep my relationship with the end-user going after the new-install honeymoon is over? If you go into this fall’s iOS 10 launch with a clear vision and answers to those questions, you’ll be ready to lead the way into the next era for mobile apps.
Thanks for signing up. Look for your first email shortly!
We’ll reach out shortly to schedule a time to talk.