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Peggy Anne Salz: “2018 will be the year of the 3Ps: personalization, programmatic and predictive models”

2017 is about to end and I wanted to start the interview section on MobAppMarketing.com talking about the mobile industry with one of the person whose opinion I value the most: Peggy Anne Salz, speaker, author and researcher who writes for Forbes, Harvard Business Review or Venture Beat. She also leads MobileGroove, top 50 ranked influential technology destination and a research and consulting firm focused on mobile search, contextual marketing and business transformation. I met Peggy in 2016 during the Mobile Growth Europe event in Berlin. Since then, we’ve been having great talks about the present and future of mobile marketing. Now, I’m delighted to share with you a very insightful conversation.

First, Peggy, I’d like to know a bit more about yourself. How did you end up as a mobile analyst?

I’ve been in mobile since the start, first as a journalist and then as a mobile analyst. I started out writing about the massive impact mobile was poised to have on everything we currently do on a desktop, for example, but in the early 00s, it all sounded a bit too science-fiction. I was writing about the interplay between mobile and content – as it was the early days and the mobile content industry that would become a billion-dollar industry was nowhere in sight. It was going to change fast – and Nokia’s release of a device dedicated to gaming  – N-Gage – followed by a service for music told me mobile was the space to watch and document. It was going to change how we live, play and work – and it did. I was excited to watch the trends and analyze the impact – writing the first reports about ringtones and mobile media for BWCS and later the first ever report about mobile search for Informa.

My focus has always been on the people-side of the equation. Now the industry has re-focused on the user journey as the starting point for a sustainable app or business, and I am extending what I do and the guidance I provide as an analyst. For me, this means consulting with mobile companies and offering the ecosystem actionable insights and analysis via all the content I write and off – most free of charge – via my books, papers and posts.

“Mobile is also at the heart of a new economy, where the mobile ecosystem functions almost like a parallel universe”

How do you see the current mobile ecosystem?

It’s exciting times. At one level, mobile is bridging digital and physical worlds. At the other end of the spectrum, mobile is also at the heart of a new economy, where the mobile ecosystem functions almost like a parallel universe. Companies come together to enable advertising, take the friction out of transactions and commerce, enable new on-demand business models that have out-innovated traditional companies that have their roots in Internet or bricks-and-mortar. However, as mobile continues to take on the role of a “connector” in multi-channel or even multi-dimensional experiences through AR/VR, it’s clear that there are going to be more companies at the table than there is revenue to go around. Who owns the customer, who influences the customer and who converts the customer and who can measure and show this – all these are the types of companies that are going to move up the food chain.

Which 3 main trends would define 2018?

I want to call my predictions the 3Ps

Personalization– Yes, it’s a big buzzword – and has been for a while – but this is the year that we will see more companies taking it more seriously. The data is there, and the demand – from users – for experiences that are more enjoyable than annoying is also there. This alignment in what users want and what companies are capable of delivering – thanks to sensor networks, machine learning and AI and the blurring of boundaries between channels – will move the whole concept of contextual relevance to a new level.

Programmatic –  Programmatic is evolving and the impact on how we develop and deploy campaigns – whether to acquire or retain users – will be seismic. At first, programmatic was all about buying digital advertising space automatically, with computers using data to decide which ads to buy and how much to pay for them, often in real time. Now, algorithmic buying and selling is much more – taking place at many more levels.

We talk about mobile programmatic, programmatic search and other applications of data and algorithms to enable marketers to make decisions in real-time about the advert they want to deliver to the consumer. It’s a lot of data points and ‘signals’ to consider and sift through, and a lot to learn. Therefore, companies have to stop thinking of this as a trend ‘just over the horizon’ and build capabilities to move up the curve. The automated and intelligent capabilities ability to target your audience and their context – and ‘learn’ with that audience based on how they interact with digital, mobile and the real world over time, is what will separate leaders from also-rans.

Predictive metrics – Mobile marketers and UA managers can no longer compete on their knowledge of “surface” data such as the cost per acquisition grouped by ad networks and partners. To gain and maintain competitive edge marketers must open the aperture of how they view and pursue growth opportunities. With this in mind, app marketers and brand marketers alike will focus on calculating predictive metrics – such as LTV. And it’s about time as spending on UA without considering key variables such as LTV is a great way to operate if you want to set yourself up to burn money as fast as you make it. That’s what has been happening in many cases, and why we will see more app companies harness unit economics and highly accurate LTV calculations to pinpoint precisely when, how and how much they should spend on app marketing and paid user acquisition to reach new heights.

“I think the biggest challenge is the shift in how companies approach UA and the North Star metrics they follow to gauge success and failure”

You work consulting many mobile oriented companies. Which do you think are the biggest challenges they manage? Challenges for UA? Challenges for monetization?

I think the biggest challenge is the shift in how companies approach UA and the North Star metrics they follow to gauge success and failure. I interview a wide range of UA ninjas for my regular podcast – including the Liftoff Mobile Heroes – and the standout issue is how to trigger actions deeper in the funnel and boost retention. Some, such as blogger and growth marketer Gabor Papp, even suggest a complete rethink – arguing its time marketers turned the model completely on its head and focused on retention “above all else”, including acquisition. I wouldn’t go that far, but it will require a new mindset to calculate retention accurately – let alone improve it.

“App marketing in 2018 is de facto data-driven marketing”

And the biggest threat?

The issue I see is app marketers are putting too great a focus on the data and paying too little attention to mobile creatives and proper A/B testing in order to make the match between the campaign and the creative – and the audience you seek to influence. As app marketing in 2018 is de facto data-driven marketing, it’s to be expected that companies will eventually reach a point where they are all armed with roughly the same analytics and attribution tools and tech. In this scenario, finding and maintaining competitive edge will get tougher than ever. This is where a focus on creatives, and segmenting them according to demographics, psychographics, and other approaches, will likely pay dividends.

“Non-gaming apps have loads to learn from these gaming pioneers”

Which would you say are the main difference between gaming and nongaming verticals?

I have been watching both since the start, when I researched fast-movers across all app categories for Apponomics, my free ebook. Gaming app marketers are by far more sophisticated in their approach to UA and to pinpointing post-install events to power predictive metrics. Non-gaming apps have loads to learn from these pioneers – and smart brand marketers are doing just this right now.

In fact, many of my clients have made it a goal in 2018 to learn from gaming apps and apply their best practice to their campaigns. To be fair, gaming app marketers also have loads to learn from non-gaming apps as they seek to harness above-the-line advertising – including TV and outdoor advertising – to build a brand. Summoner’s War is a great example of a multi-channel campaign showing the way this is done. And, as more users search for apps by name (a phenomenon TUNE picked up on a few years back), then branding is going to be a big part of what distinguishes leading games from everything else that ends up on the heap.

Peggy and myself podcasting during MGE Berlin in Oct’17.

 

One of your latest post for Forbes Magazine was about new distribution channels out of GP and App Store, how big do you see this opportunity?

For me, this is the one to watch. I view this opportunity through the lens of retail since apps are digital products. If you get in this mindset and think like a real-world marketer, then the choices and opportunities are crystal clear. Let’s say you are marketing detergent. To be successful, you want that product on the shelves of every shop in every location – or country – where you can reach an audience likely to appreciate and – ultimately – buy it.

Of course, if you are monetizing your app with advertising, then it’s all the more reason to want to get your app in front of new users and extend your reach. So this is the strategy that should spur you to explore new distribution channels beyond the duopoly of Apple and Google. How big is the opportunity? When we consider that these alternative app stores include the likes of Amazon and Tencent – then it’s clear these are routes to market you can’t bypass because they are growing in size and importance. In my book, the inclusive strategy will always win over one that excludes possibilities – or in this case app stores. So, I encourage app marketers to aim high – and wide.

“No question that AR and VR are coming”

How much hype do you think VR/AR are having? Do you really think they are the future? And if so, when is it expected?

No question that AR and VR are coming – more likely AR first because of the exciting use cases emerging in verticals such as advertising consumer goods or delivering amazing retail experiences. We are already seeing pockets of AR innovation and – more importantly – campaign and app success stories.

VR will be a little longer in coming  – partially because there needs to be consensus on platforms standards and a critical mass of VR devices in the market. That said, don’t pursue the technologies because they are cool. But, it they are a fit with your app and audience, then don’t ignore the opportunity to get in now to be ready when we are out of the chasm and into the bowling alley.

“Focus on data, shortcuts and high-value users are the key to succed in mobile”

As an analyst who has studied many different cases. Which would you say the 3 main ingredients to succeed in mobile are?

1) Pay attention to the metrics and the data, and never settle for surface knowledge. Dig deep and get your hands dirty and don’t get into the trap of being blind to what doesn’t fit in your spreadsheet or align with your analysis.

2) Look for shortcuts, so you can focus on what really matters. If you’re in marketing, you’re drowning in data and analytics – and that’s going to get worse before it gets better. If you’re going master the data deluge, you need to be more effective and efficient in how you deal with data. Look for ways to make your life easier. It can be something as basic as making the extra effort to define consistent naming conventions between different sources for better unification, or using programmatic to automate bidding or programmatic search to customize ad copy to match keywords. Look at your daily routine and your stretch goals and streamline where you can using tech and AI to save time for the work that requires human thought and inspiration.

3) Learn to look for high-value users. High-quality users are also hugely expensive, so learn what to look for. What does a highly engaged user look like to you? You don’t know? Then figure it out fast because knowing the signs of the user (based on engagement, purchase frequency, or whatever you decide defines a valuable user) is a critical component of managing a marketing budget of any size.

It’s been a pleasure talking to you Peggy, thanks so much.

Sure! You’re welcome!

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