Acquiring mobile users is expensive, but here's why they're worth the cost

Even as cost-per-install rates soar, the cost of loyal users is going down. Here's what businesses building mobile apps should know.

Image: iStockphoto/Nongkran_ch

Apple's App Store may have created 1.9 million jobs, but it's unclear how many of those jobs pay a living wage. After all, VisionMobile's survey data has long revealed that most developers live below the app poverty line, making less than $500 per app per month.

There are signs, however, that life is getting better for mobile app developers.

SEE: Mobile device computing policy (Tech Pro Research)

App Annie, for example, is forecasting that the App Store will generate $101 billion by 2020. More importantly, however, the cost for acquiring a loyal app user, and not simply someone who installs an app, is in decline. With roughly 30% of all mobile advertising currently focused on getting people to download apps, everyone benefits if those billions of dollars start to create real brand loyalty, and not simply app churn.

Loyalty comes at a price

The cause for hope comes from recent Fiksu data. Fiksu, which specializes in helping brands build and run app acquisition and re-engagement campaigns, issues a monthly index that tracks the cost of generating app downloads and app loyalty, defined as a user that opens an app three times. Those numbers show though the cost per install (CPI) keeps going up, the cost per loyal user (CPLU) has declined a bit over the past year.

On iOS, CPI rose 12% to $1.64, a 28% increase over January 2015. On Android, CPI went the opposite direction, declining 44% to $1.91 from December 2015 while rising 25% since January 2016:

Now, compare this to the cost of acquiring a loyal user (CPLU), which plunged 34% since last month to $2.78, and experienced a year-over-year decline of 4%:

In short, the cost of corralling new users into your apps keeps going up, but the cost of generating loyal users seemingly paradoxically has been going down.

What gives?

Are we there yet?

The Verge's Casey Newton writes that "the App Store's middle class is small and shrinking. And the easy money is gone," which is correct, but doesn't tell the whole story.

For one thing, more and more companies aren't even trying to sell apps. Either they offer in-app purchases or, if they're a big brand like a hotel chain, they generate revenue through their app. For these companies, it doesn't matter whether the App Store economy is $101 billion or $1.01, because the revenue they generate is facilitated by apps but not counted as part of the "app economy."

Selling apps, in other words, is old school.

This is implied by the Fiksu data. When I asked Fiksu co-founder Micah Adler why CPLU has declined even as CPI has gone up, he made it clear that it has a lot to do with "higher quality" of installs.And yet, big brands still need to find ways to get users to download and engage with their apps, and so should be concerned by CPI inflation. The good news is that mobile marketers appear to be getting better at generating app loyalty, and not merely app installs.

"This is because the average install this year has a higher likelihood of turning into a loyal user, compared to last year," Adler said. "So, even though it is more expensive to get a download, this is more than made up for by the higher quality."

By higher quality Adler really means better use of data, or "the ability to extract the right audiences from that data," as he told me. "By getting the right people to download the app, they are more likely to be long term users of the app."

Spending on engagement

Adler's response is understandably focused on optimization of ad spend, given that's what Fiksu does. But, lost in that analysis are the myriad other things that app developers are doing to foster loyalty in their user base.

While companies have increasingly focused on app engagement for years, it's only been in the last year that mobile marketing automation and related technologies have become more science than art. What used to be "dumb pipes" has become real-time, data-driven orchestration of notifications that nudge a user along a desired purchasing path.

SEE: On the cusp of the next wave of mobile monetization (TechRepublic)

Between optimized app user acquisition campaigns and ongoing improvements in engagement strategies, marketers are finally starting to get real value for their mobile marketing spend. That's good news for the app economy, but it's great news for every business that depends on mobile...which is every business.

Reference & Courtesy: http://www.techrepublic.com/article/acquiring-mobile-users-is-expensive-but-heres-why-theyre-worth-the-cost/

Intuit sells Quicken to private equity firm in management buyout

33-year-old personal finance software will be bolstered by more Mac development, improvements in reliability on Windows, says current Quicken manager

Credit: Intuit

Intuit yesterday said it had sold its Quicken personal finance software unit to H.I.G. Capital, a Miami-based private equity firm.

Financial terms of the deal were not disclosed.

The announcement put an end to a sales process that went public last August, when Intuit told customers it was unloading three parts of its business -- Quicken, QuickBase and Demandforce -- to focus on its most profitable software and services, the QuickBooks small business accounting division and the seasonally-skewed TurboTax tax preparation group. In January, Intuit sold Demandforce to Internet Brands for an undisclosed amount.

Last summer, Intuit's CEO explained that Quicken, which unlike QuickBooksand TurboTax lacked a cloud-based service or subscription offer, was essentially a dead end for the company. "Quicken is a desktop-centric business and it doesn't strengthen the small business or tax ecosystems," said chief executive Brad Smith in a conference call with Wall Street last year. "Our strategy is focused on building ecosystems and platforms in the cloud."

Quicken's contributions to Intuit's bottom line have been minuscule: In the 12 months preceding the August announcement, Quicken, which starts at $35.10 (Amazon price), contributed just $51 million to the firm's total revenue of nearly $4.2 billion, or slightly more than 1%.

But the company pledged to find a buyer who would invest in the 33-year-old Quicken software. That buyer turned out to be H.I.G. Capital, a global private equity firm that manages some $19 billion.

Eric Dunn, the head of Quicken, announced the sale in amessage and video posted to Intuit's website.

"[H.I.G. is] confident, as am I, that Quicken will thrive with increased investment, leading to product improvements and advances that will allow Quicken to continue to serve you well for decades to come," Dunn said.

The sale, said Dunn, will allow Quicken to double the number of engineers working on the Mac version -- which has long lagged behind the Windowsedition in features and functionality -- and devote more resources to improving the program on the dominant platform, Windows.

"We all know that Quicken could use some TLC, some tender loving care, to be as great as it can be. I'm very aware that Quicken isn't perfect," said Dunn. "Quicken [for Windows] could probably use some attention to the fit and finish, the polish, usability, resilience and reliability."

Dunn has his work cut out for him.

In many ways, Quicken is software that users love to hate. With years of data in the company's proprietary format -- and few alternatives -- they not only feel trapped but also regularly rail about the product. Quicken's listing on ConsumerAffairs.com, the consumer advocacy organization's website, makes for dismal reading: The overall satisfaction rating is one star out of a possible five.

"Like many other Quicken users, I ran into problems with Quicken 2016," complained someone identified only as "John" last month on ConsumerAffairs.com. "Quicken has the worst customer service of any major company with which I have had to deal. Their representatives are uninformed and untrained in the most simple issues."

The sale was a management buyout: Dunn confirmed that he was a "significant personal investor in the transaction." How that will work out over the long term was, not surprisingly, unclear.

Typically, a private equity firm that has partly financed a management buyout -- in such deals, managers are required to make personal investments to guarantee that they have a vested interest in success -- wants out after several years to recoup their investment and, assuming the transition has worked, to take a profit. At that point, the firm may be in the hands of management; or the equity firm's stake could be sold to another buyer or investor.

H.I.G Capital has invested in other software or software-based services recently. In January, H.I.G. was among the investors that bankrolled the purchase of Salary.com, a Wellesley, Mass. firm that focuses on employee compensation data, software and services. That was a management buyout as well: Salary.com's founders bought the company from IBM, which had acquired it in 2012 as part of a larger purchase of Kenexa.

The Quicken sale is expected to close by April 30.

Reference & Courtesy: http://www.computerworld.com/article/3041032/desktop-apps/intuit-sells-quicken-to-private-equity-firm-in-management-buyout.html

Ubuntu convergence finally impresses me

Image: Jack Wallen

It's taken me a long time to get on board the Ubuntu convergence train. I've been very pessimistic about the whole platform, based on the terrible state of Ubuntu Phone (as run on the Bq Aquaris handset).

But then, I happened to watch a video, by the wonderful people of XDADEVELOPERS, from Mobile World Congress, in which John Lee (of Canonical) demonstrates convergence with Ubuntu Phone running on an older Nexus 4 handset.

This video came just a week or so after Canonical made the first official announcement of a Ubuntu tablet to be released. This table will be manufactured by Bq and will be a part of the same Aquaris line as is their Ubuntu phone. The specs for the tablet aren't too shabby:

• Display: 10.1-inch IPS touch display (1920×1200 pixel resolution at 240 ppi)
• CPU: 64-bit MediaTek MT8163A 1.5GHz quad-core processor
• RAM: 2GB of RAM
• STORAGE: 16GB (micro SD memory card is included, adding storage expansion of up to 64GB)

All of this is fine and good...but up until now everything I have seen from Bq has been less than impressive

Let me explain.However, after digging around a bit (and watching the above video from WMC), I realize that all the criticism tossed at Ubuntu Phone has been premature.

First and foremost, we get what convergence is. You use a single device for all your needs:

• You carry your phone with you all day
• You work on your phone
• You plug your phone into a monitor and switch it to desktop mode
• You work at your desk with your phone
• You unplug your phone, switch it to phone mode
• You go home
• You plug your phone into your monitor at home and switch it to desktop mode
• You play on your phone at home
• Wash, rinse, repeat

For some of us, this doesn't make sense. Why? Because we're of an older mindset that precludes us from making a smartphone or tablet our only device. I do things that require some serious power (rendering videos and audio). But the truth of the matter is, a large percentage of people (especially of the millennial generation) have forsaken the tried and true form factor for their mobile devices. So when you consider this, convergence makes perfect sense. And, after watching the Canonical demo, the light goes off over my head and I can finally shout, "Ah ha!"

But what about...

The first question that comes to mind, when you consider this relative newcomer to the mobile space, is that of apps. As it stands, there are very few apps available for the Ubuntu Phone platform. To settle that issue, there is one thing you must consider:

Ubuntu Phone is still very much in development.

In fact, I would go so far as to say Canonical was quite premature in the releasing of devices. You see, this whole schmear isn't going to spread properly until Unity 8/Mir is released. At that point, everything changes. Once the Ubuntu desktop is in conjunction with the phone/tablet space, everything will be running the same platform, the same code. That is when things get interesting. When we finally see phone/tablet/desktop running the same release of Ubuntu, we'll see convergence finally work as it should. Why? Because all those apps we depend upon (LibreOffice, Audacity, Gimp, etc) will run on the convergent platform.

It should be noted, however, that the Bq Aquaris M10 will ship with LibreOffice, Mozilla Firefox, The GIMP and Gedit pre-installed. That's right, full-blown legacy apps running on the mobile platform. The current release date of the M10 is set for March, 2016.

Premature release of the platform

Lots of work still must be undertaken before this will come to fruition. That is why I believe Canonical was premature in releasing any devices. So far everyone has been less than kind to the Ubuntu Phone platform. What we really didn't understand (even though it was staring us in the eyes) was that we were seeing software very much in beta...maybe even alpha. It's a very rare occasion that a piece of beta software is ready for release. That was the disconnect. Ubuntu Phone has not (and is still not) ready for release.

The good news is that Unity 8/Mir are just around the corner. Canonical has given us every indication that Ubuntu 16.10 will ship with the new platform. I will, however, offer up this piece of advice. When Ubuntu 16.10 does ship (October, 2016), make sure Ubuntu Phone is ready to deliver on the promise of convergence...completely. If Canonical can pull off the full blown convergent experience (as in all legacy apps run on the platform), then they will have a major victory on their hands (as well as a platform ready for public consumption).

I hope this happens. Canonical and the Ubuntu Phone developers have been working tirelessly on this project and it needs (nay, deserves) a win of this magnitude.

Do you think Canonical's take on convergence will succeed? If not, why?

Reference & Courtesy: http://www.techrepublic.com/article/ubuntu-convergence-finally-impresses-me/

Are Your Kids The Latest Target Of Hackers?

The short answer is yes. V-Tech and Hello Kitty join the depressingly long list of companies to have been hacked in 2015. This time, however, the data taken were overwhelmingly about children – their usernames, passwords, addresses, birthdays, photos, and other personal information.

At first glance, you may be wondering why hackers would bother, but there are three major reasons for targeting toy companies. First, they are an easy target. V-tech representatives admit that the company’s security was subpar. Second, children tend to reuse passwords just like adults do, so getting a password for one site may unlock most, if not all the sites that child uses, and of course, some sites require payment for various features to be unlocked, or are purchasing portals, so the child’s information may inadvertently expose a parent’s credit or debit card information.

Third, and perhaps most chillingly, it could well be about the long game. A hacker need only wait until the child is old enough to get a credit card and then steal his or her identity. It’s not like it costs anything to store the data and wait, and given how easy it was to breach V-Tech and Hello Kitty’s security, that’s as good as being handed free money.

There are two tragedies rolled into one here. The first and most obvious is that not even our kids are safe from hackers, and nothing seems sacred to them. The second is that the breach could have been avoided. It’s not like V-Tech or Hello Kitty didn’t have ample warning or ample opportunity to protect themselves against such things. Online tech portals have been screaming from the rooftops all year about the dangers, and outlining the steps companies need to take if they want to be secure. V-Tech and Hello Kitty simply opted to do nothing with the information. That makes it somewhat difficult to feel sorry for them. They got lucky for a while, skating by with minimal security. Looks like their luck ran out. How’s security at your company? If you are unsure, a network audit is probably your best first course of action.

Meet the Man Who Keeps Microsoft Safe and Secure

As the chief security officer for Microsoft, Mike Howard has more than a passing interest in the things he sees on the nightly news. Whether it's an uprising in the Middle East, the ongoing threat of terrorism or a natural disaster somewhere in the world, the former CIA officer is prepared for the impact various events could have on his company and its employees.

"Cybersecurity is a big issue on everyone's mind as we've become more globalized as a society and businesses have expanded their footprints and everything is digital," Howard said. "But, traditional security issues of theft, violence against employees, terrorism and natural disasters are all still paramount in terms of being the big security challenges for businesses."

This is especially true when your company is so large and so much in the public eye. Howard's security team is ultimately responsible for the safety and security of Microsoft's entire executive team, its 90,000 employees, roughly 90,000 contractors, 700 facilities in more than 100 countries worldwide and all of the visitors to those facilities. He's also responsible, of course, for all of their computers and hardware and the information it they contain.

The Microsoft security teams deals with threats of violence against executives and employees, employee violence, kidnapping threats, terrorism, natural disasters, property theft and, peripherally, intellectualproperty protection (which also falls under the purview of a separate, cybersecurity group at Microsoft).

Security "evangelist"

In Howard's time at the company, the security team has had to evacuate employees from Beirut and the Ivory Coast, has contracted forensic psychologists to examine threatening letters and regularly provides emailed safety information and warnings to all employees who travel overseas.

But it may be his role as an "evangelist" for the company's physical security business group that looms the largest in Howard's job description. Finding ways to communicate and demonstrate the importance of security — both physical and cyber — to the company's executives is the linchpin of developing a security program that manages to keep such a large and public company running smoothly, he said.

"A lot of [Microsoft's commitment to security] has to do with the evangelizing of security on several fronts within the last decade," Howard said. "My IT securitycounterpart and I have worked diligently to really get the movers and shakers, the decision makers here to understand security and to support those security efforts and the pushing down of that message throughout the enterprise."

Howard believes that his work driving home the importance of both physical and cybersecurity is part of the reason that Microsoft's company culture has come to reflect those values.

"We brief all new corporate vice presidents on security, we bring senior executives to the Global Security Operations Center in Redmond, [Wash.] and show them what technologies we employ to keep the company safe," Howard said. "We're not just guys checking doors and responding to emergencies."

Howard believes that Microsoft has come to understand what many companies never do: That cyber and physical security is integral to the company's overall business, and even its marketing plan.

"Security is important to the entire company," he said. "Intellectual property could be compromised and it can affect the company's brand reputation or lead to lawsuits," Howard said. "This realization led to cultural shift with company becoming more security conscious."

Employee assistance

To facilitate the rollout of solid security plans throughout the company, Howard's team has had to essentially deputize every employee to be the eyes and the ears of the company. Microsoft does that with a formal training program.

"Having a training program in place is essential to any security program," Howard said. "Without it, you don’t have a well-rounded security program. We have a certain amount of full-time employees and vendors to cover Microsoft globally; we could never cover the world adequately without educating and creating awareness programs that teach people what to look for."

Today, regular Microsoft employees are instructed to stop a stranger entering a building and ask to see their badge.

"That never would have happened ten years ago," Howard said.

Howard said that good security also involves working with the company's human resources department, which offers employee assistance programs that can help workers in difficult times and potentially prevent an employee problem from becoming a security threat.

"A robust employee assistance program is very important to security issues," he said. A bad economy, problems at home, even dealing with a sick relative can be things that can trigger security issues at work and having a team in place to help solve those problems can prevent them from ever turning into an incident of violence or theft, he said.

Reference & Courtesy: http://www.ittechnewsdaily.com/153-microsoft-security-officer-keeping-company-safe.html

A Bright Spot in Tech’s Gender Gap

The technology world is still run by men. They have more than 80 percent of the software developer jobs, according to the U.S.  Bureau of Labor Statistics. And they hold most of the leadership positions.

But there’s good news for the Marissa Mayers of the world. The rare woman who does manage to hack her way to a top technology job is paid the same on average as a man in that position, as long as they have the same experience, according to a report by Dice, which tracks corporate compensation. That’s been true since at least 2007, Dice found as part of historical research for Bloomberg.com.

The study, which examined information-technology jobs in various industries, found that while there’s equality for men and women in comparable positions, women tend to end up in less lucrative jobs. Women in those jobs make an average salary of $87,527, while men make $95,929, according to Dice. If only there were more ladies leading teams.

“It’s obviously very encouraging that women in the same position are making the same amount, but why do they end up in different positions?” Shelley Correll, a Stanford University professor who specializes in gender research, said in an interview.

Sheryl Sandberg, Facebook’s chief operating officer and “Lean In” author who is on a whirlwind media tour to promote her book about female business leadership, has said the gap is a result of a combination of factors. Many women leave the workforce before they have to, decide not to take on larger projects, or lack the confidence in their qualifications to apply for promotions, according to Sandberg. So she’s been advocating for women to be more assertive at the office.

Besides equal pay for men and women in the same jobs, there is another commonality between the genders: Dice found that nearly half of all male and female business professionals were not satisfied with how much money they made.