Mobile platform - getting smarter and growing in importance

iPhone iStock_000017188325Small.jpg.png

There are more internet connected devices in people’s hands these days than the total installed base of computers and laptops. If you add on the 440 million tablet devices to the 1.6 billion smartphones it far exceeds the total of 1.53 billion desktop and laptop computers.

Data from Mary Meekers (Kleiner Perkins Caufield & Byers) presentation at the ReCode conference on Internet Trends May 2014

Data from Mary Meekers (Kleiner Perkins Caufield & Byers) presentation at the ReCode conference on Internet Trends May 2014

We have reached this tipping point of mobile vs desktop and from here the divergence will only accelerate , especially as currently only a quarter of internet usage is on a mobile device. A few years ago we heard the phrase “mobile-first’ when describing the mindset of new tech companies, that mantra has to be a continuing theme of all business models that rely on a technical platform. When it comes to real estate advertising, there is no argument it is a technical platform that dominates real estate advertising when seen from the consumer perspective.

An interesting deeper insight into this mobile usage for home searching was highlight in data last year from the US portal of Realtor.com published in the Wall Street Journal which highlighted the profile of mobile vs desktop searching by suburb in the US. The findings showed that the higher priced suburbs saw far higher usage of mobile and that within this usage which exceeded half of all views, the Apple iOS ecosystem dominated with combined iPhone and iPad accounting for 50% of views vs. 8% for Android in these high price suburbs. 

At home in NZ we have seen a number of developments to the mobile landscape over the past year with enhancements to the Realestate.co.nz app as well as the Trade Me Property app. In addition we have had the launch of the Kiwi Bank Home Hunter app and a iPad app from Open2View.

When analysing the relative level of audience to Realestate.co.nz and Trade Me Property earlier this year I analysed the performance in terms of downloads using the tracking analytics of AppAnnie which ranks apps on a top 1,000 list per country. At the time back in Aril there was no doubt that Realestate.co.nz continued to lead the field in terms of the higher ranking in new downloads, added to which its installed base built up over nearly 4 years had given it supremacy over Trade Me Property amassing over 200,000 downloads.

Revisiting the latest stats from AppAnnie though shows a very significant difference as the two charts highlight below:




Trade Me Property’s iOS app (for iPhone and iPad) has leapt in the rankings since the beginning of July from 350th placed downloaded app in NZ to an average of around the 70th most downloaded app. Meanwhile Realestate.co.nz download ranking appears to have slipped from a high of 175th place at peak in Feb / March to 250th overall place in the past 3 months.

What could have lead to this significant lift in the rankings of Trade Me Property?

I don’t actually have the answer - I will ask Trade Me Property to share their secret if I get the chance. However if I was in their shoes the advertising tactic I would have used is the new download app placement available now from Facebook and Twitter

The sheer simplicity and contextual logic of these ad services staggers me. Both Facebook and Twitter as news and social platforms are more and more about mobile - they are also used constantly and given the profile data they have about users they can target so perfectly so as to maximise conversion and in so doing minimise advertising spam and maximise revenue per ad unit.

Look at this simple example:

Option 1 : Web advert for mobile app

Consumer experience - if on a desktop / laptop click on advert, taken to company website and the click again to app store to then sync app with mobile device. If on mobile device often face difficulty of landing page design not optimised for mobile

Cost for campaign: $4 per 1,000 impressions - company buys 1,000,000 impressions. Typical click through rate of 0.05% = 500 clicks to landing page, 70% conversion to app store and 50% conversion to download.

Result - 1,000,000 ad units, spend of $4,000 for 175 extra downloads = $23 per acquisition

 

Option 2 : In app download

Consumer experience - only on mobile as specifically targeted. Only shown if profile matches profile of property buyer

Cost for campaign : pay for performance vs. pay for adverts. $15 per download is far less than cost of traditional advert. Conversion rate of 10% - to achieve 175 downloads requires only 1,750 ad impressions and costs just $2,625.

This model is a win win for each party - the consumer is saved the extreme bombardment of endless ads, the company only pays for successful downloads, the advertising platform (Facebook & Twitter) shows far less adverts and attracts new advertising revenue.

 

This is the future of advertising and saves us from the ages old ‘shotgun’ approach to marketing. That is how I would approach the promotion of a mobile app.