Survey Points to App Marketing Flaws

'Incentivized downloads' don't lead to loyal users

A popular tactic for promoting smartphone apps may not actually be paying off, according to a new survey commissioned by mobile ad startup Pontiflex.

The survey, conducted by Harris Interactive, covered a range of mobile app- and ad-related topics, but the most interesting results came on the subject of "incentivized downloads," where users are offered rewards (usually virtual currency or goods) to download another app. But while that may encourage people to download your app, the vast majority won't come back.

Of the respondents who had downloaded an app for an unrelated incentive, only 3 percent said they used the promoted app very often, while 62 percent said they downloaded the app just to receive the reward, then either uninstalled it or used it only once. Another 17 percent said they "hardly ever" use the app.

Pontiflex CEO and co-founder Zephrin Lasker says he's not completely opposed to incentivized downloads, but he argues that they're currently overused.

"There's probably a place for them if they're priced appropriately," Lasker said. "But they should be the model of last resort. You see a lot of incentivization, and in the end, those aren't long-term, sustainable business models."

Incentivized downloads received a serious blow earlier this year, when Apple (arguing that developers were using promotions to distort the App Store rankings) decided to crack down on them. However, Pontiflex says that the model is still thriving on Android phones, which have no such restrictions. Of the 2,810 survey respondents, 7 percent had downloaded an app based on an incentive. (That's more significant than it sounds, since only 958 of the respondents owned smartphones.)

And even though developers who promote their apps this way may face the biggest challenge turning downloads into real usage, the issue is broader than that. For example, mobile analytics firm Flurry recently released a report saying that among the consumers who download a given app, an average of 24 percent are still using it three months later, a number that shrinks to 4 percent after a year.

So Flurry says that for developers in general, the problem may be the real challenge isn't getting people to use the app—it's getting them to come back.

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