“When you combine ignorance and leverage, you get some pretty interesting results.” Warren Buffett
Gimme Fuel, Gimme Fire! No, just gimme downloads.
I've been working with the guys over at Openfeint for a while now and they've got a great thing going. Their company is blowing up and they are making huge moves to get into the global market of social gaming. Openfeint is a social gaming network, much like GameCenter, with a few hundred million users and an awesome business model. I'm fired up to work with these guys and wish them the best.
We worked out a deal to feature Alpha Combat as a free game of the day in order to find out the total impact of this kind of promotion on an arcade game as such. The game is featured on the website (seen above) and in their app, along with a few other distribution channels. The market reach is enormous, and forecasts for download numbers have been anywhere from 15,000 to 200,000 in the weeks following the promotion. And for good reason – the price tag on this gives you reason enough to be serious about making something happen.
I spent a few days creating all the necessary promotion graphics and PSD files, updating meta copy and getting ready to see what happened. I followed my own app pricing strategy and changed the app to paid right before the promotion in order to maximize the lift of the free promotion. Everything was all set and I was watching the charts through my AppViz software.
Here's what happened.
User base increase of 60%
Sorry if you can't read the text on this graphic – if you follow it left to right, the boxes read
- Red – Free
- Blue – Paid ($0.99)
- Red – Switch to Free 10AM EST
- Black – OF Promotion Goes Live
- Blue – Switch back to paid ($0.99)
On the day of the Openfeint promotion, I received my biggest one day total to date – 14,303. The next day was 12,254, then 10,793. Beyond the Openfeint networks, I had a major lift into the Italy iTunes market and enjoyed a top 10 Free Games spot for about four days. Before the promotion, I had about 90,000 users in a little under 3 months. In the week following the promotion, I now have 150,000. That's good stuff.
Daily Revenue Increase of 75%
You'll see that the shape is relatively similar to the sales graph – the days after the promotion, the app was pulling in about $80-100 a day. My usual daily revenue hovers between $30-40 off the app. It is important to remember, however, that I actually make MORE money from the Playhaven cross promotion widget in the app than I do off the sales and in-app purchases of Alpha Combat.
Collectively, I made about $220-250 a day for the week following the promotion until I made it paid again (last blue box).
Back to where it all began….yeah right.
So now that the Openfeint magic has essentially worn off, I'm back to my regular life of marketing the hell out of this app with traditional marketing. Or am I? I stepped back and realized that I now have an ocean of users using my app, about 40 new positive reviews, and above average metrics across the board.
A good analogy is to being a builder – you can work on houses and make 15% margins and live a comfortable life or you can work on corporate buildings and make 15% margins and retire when you're 40.
This promotion gave me a big step from building houses towards building corporate structures – I'm doing all the same things but with a leverage arm that is 50% more powerful. And, as the obsessive marketer I am, I immediately wanted to capitalize that.
Making Money with Apps – Status Updates on Steroids
So this promotion is great and it made me a nice chunk of change, but you should never look at promotions as a way to make your money back – all they do is provide users that you can deepen your leverage with. The number one way to do this? Updates.
I released a Version 1.1 update in tandem with the Openfeint promotion that I held for developer release so that I could time it with the next weekend and with a second price cycle. Now I have 60,000 users that I am going to engage in the first week of being a client (See RFM modeling for more info on this) and 150,000 total that I can re-engage. New icon for retina displays (makes a big difference) and increasing the value of my best performing in-app purchase to incentivize people to pull the trigger.
My developer friend just did an update on a basic hotel booking app and this is what happened when he released an update to 500 people:
I'll be sure to update this post when I get some data from the Alpha Combat update (which went out 1/14/12 at 9:30AM EST).
Would I recommend the Openfeint promotion to someone? Absolutely – but they need to be aggressive marketers with a 100 day plan if they want to make their money back (unless, of course, your daily numbers dwarf Alpha Combat, which many do).
No matter what, it's a hell of a lot more fun to work with big numbers than it is to work with small ones! 😛