Mobile apps... of the future!
I’m here in Cambridge, MA today watching the Xconomy panel on next-generation consumer mobile applications. The panelists today are Meredith Flynn-Ripley of HeyWire, Jeff Chow of Spring Partners, Michael Putnam of Jana and Charles Teague of LoseIt. The panel is being moderated by FitnessKeeper CEO Jason Jacobs.
1:31 p.m. — Panel question — how much of what you do is mobile?
Flynn-Ripley: I firmly believe it’s a post-PC era and it’s smartphones and tablets that are driving everything.
Teague: What makes LoseIt work is when a user sticks with it… If we can get a user to engage then they succeed… Our mobile users engage longer, they stick with it longer and they succeed more. We always look at mobile and we say mobile needs to be a first-class experience.
1:37 p.m. — How much is app store featuring a strategy?
Chow: It can be a slight addiction. We’ve all been featured at some level. In our experience, you see these numbers go 5x, 10x on number of daily signups after we’ve been featured on the Android front page. We always hope they don’t take us down and then they do and you have that hangover feel. Word-of-mouth is the best way to do it.
Flynn-Ripley: Since I’ve never been featured I don’t think it’s a strategy you can count on. We employed social media, a Twitter handle, a Facebook page. It’s much harder to make a name from yourself unless you get picked up by Xconomy.
1:42 p.m. — What percentage of users are typically a loyal usage of that app since many consumers download an app but never use it?
Putnam: Companies usually say we have x-million downloads but it really is a vanity metric and it doesn’t matter. What you really care about is your monthly users. Across the board you see much more engagements in apps than in mobile web. With an app it really is brand loyalty, they come in through your front door and engagement is really two-to-four times more than average.
I think the analytics for apps are less mature, although companies like Localytics are doing a great job of it.
Flynn-Ripley: 30% of your registered users are your active monthlies, 10% of those are engaging with your app daily.
Chow: Just imagine a free app how many people download it. We try to make sure we have our “power user” base in mind. But at the same time you do obsess over people you’ve lost.
1:47 p.m. — What are business models and how much are you thinking about business models at early stage versus growth?
Teague: We want to make sure we have a product that creates value in peoples’ lives and gives them results, and then worry about the business model. We’re focused on creating a great experience for users and we don’t think advertising produces a great experience. This is the year we’re working on business model and we have not yet figured out what we’re going to do. We haven’t yet talked about it.
Flynn-Ripley: Mobile advertising does intrude on the user experience. You really have to have a technology person focus on advertising. You have to manage those ad networks just like you would anything else.
Chow: Is there a way that brands and consumer advertisers can help consumer outs instead of being the dancing mortgage guy on banner ads? We’re slowly rolling out the idea of advertising assist. Movie studios can partner with Fandango, for instance. We want to make sure the consumers love our product for what it is.
Panel #2: Mobile comerce revolution.
Andrew Paradise of AisleBuyer, Seth Priebatsch of SCVNR, Chris Gardner of Paydiant,
Moderated by Bob Hower of Advanced Technology Ventures
1:59 p.m. Seeing an explosion of mobile payment options, the question is who has the leverage in the payment cycle?
Seth: In the end, the consumer controls pretty much everything. Whatever consumers want to use is what everyone ends up getting behind. While everyone has a lot of blocking power at the end it’s going ot be consumer choice that drives adoption.
Paradise: One of the companies that has been trying to gain in this space has been PayPal. I think overall it’s very difficult to drive merchant acceptance because it’s very hard to drive the mindshare of the consumer to pull out their mobile phone to pay for something instead of a credit card.
Gardner: For a period of five years ubiquity is going to be difficult to come by but in the end I think there will be a few winners, not one.
2:02 p.m.: Starbucks currently has the most successful mobile payment platform but it’s a relatively closed system. Is that the kind of model that’s going to succeed?
Gardner: These guys clearly want to contorl their own wallets in addition to allowing for other ones. Loyalty, coupons, receipts and returns are what makes it compelling to users and that’s what they do really well.
Paradise: There’s a huge difference between Starbucks’ success and being a huge player in mobile payment. Until we get the consumer used to pulling out their mobile phone and paying, it’s going to be fragmented.
Seth: If you’re a local merchant you’re saying “I think I’m getting paid just fine, I don’t want to have to retrain my staff.” Part of the reason Starbucks pushes their own card is that you preload $20 onto your card and you pay the transaction fee just once. You can keep more of your money and give less of it to big banks. On consumer side, the real catalyst will be ‘Show me the money.’ If I can save a dollar or two by paying with my phone.
2:07 p.m.: Which platforms will survive?
Gardner: Folks like Google would like you to think that Google Wallet is the one wallet to rule them all. But in reality, the phone is the wallet and you have a lot of different options. We’ll see multiple apps that have wallet-like functionality.
Paradise: NFC’s jumped to being on 7.5 million phones. They’re teaching the consumer the behavior of using your phone instead of your wallet.
Seth: Think there will be three winners, maybe two. People don’t necessarily want to have their data shared across multiple different networks and merchants certainly want to have access to the most widely-used platforms. I think there will be competition but it will narrow down to the more widely-used apps, in the same way that we today have four major payment cards. The universe will start off incredibly large and will compress down to three to four different platforms that work at tens of thousands of merchants. Just like people only wnat one social network, they only want one platform to let them pay with their phones.
