A lot has changed in the iPhone App Advertising space in the past couple years.

First, you didn’t have to advertise much. In the first few months the app store was open, just creating a great lite and paid app, and updating it often worked really well. There were relatively few apps being updated often, so that added exposure could give you a nice boost in downloads. After the first 3-6 months, I think that strategy got tougher and tougher. Many more apps were being added daily.

Second, you could get a small combination of marketing activities (PR, iPhone app review sites, forum posts, and Youtube reviewers) together and this could give you a nice lift in ranking to launch your initial app. I’d say this worked in the first 12 months after iTunes was launched.

After 12 months it became increasingly harder to market your app with out spending advertising dollars.

So where do you spend advertising dollars today to marketing iPhone apps?

You might try:

• Ad Networks
• Incentivized Download Companies
• Promotional Companies

There are pros/cons to all of these. Let me know give you an overview of each and what I see as their pros and cons.

iPhone Ad Networks

Here are some things you should know about iPhone Ad Networks:

• These iPhone ad networks promote your app in other iPhone apps
• Examples of these ad networks include Admob, Millennial Media, and iAds
• You pay these iPhone ad networks typically per click (~ $.05/click minimum for Admob and $.25/click for iAds)
• They have the ability to track how many downloads they generate for you
• You run a test with them, say $500-$1,000 to see if they can help you achieve your cost/download goal

iPhone Ad Network Pros

Here are what I see as the pros to working with iPhone Ad Networks:

• Relatively easy to get set up
• You can spend as little as $50 with Admob (but will need to spend more if you want a true test)
• Most of the time (iAds not included) you don’t have a big $$$ commitment

iPhone Ad Network Cons

Here are what I see as the cons to working with iPhone Ad Networks:

• You don’t always get the results you want*
• Driving more downloads doesn’t mean you are driving revenue
• Some of these ad networks, iAds for example, have minimum spend commitments

* Typically you spend in order to increase your downloads, which increases your rank, which increases your organic downloads. I’ve seen this work. Unfortunately, I also know of developers that have spent $75 and did not seen a single download.

Incentivized Download Companies

Here is how they work:

• These companies promote your app in other apps (user is given the chance to download your app in exchange for something they want)
• The user typically gets some reward (i.e. poker chips, coins, etc) for downloading your app
• You pay these companies (Tapjoy, W3i, Flurry, etc) per download

Incentivized Download Company Pros

Important note: In April 2011 Apple began to reject apps that promoted incentivized downloads. So, although you can still work with these companies, this form of advertising looks like it’s going away.

Here are what I see as the pros to working with iPhone Ad Networks:

• Also fairly easy to set up
• You can increase your ranking quickly if you have $$$ to spend
• Many of these companies can promote iPhone and Android apps

Incentivized Download Company Cons

Here are what I see as the cons to working with iPhone Ad Networks:

• #1 con – looks like this type of advertising is going away
• You are not really driving “real” users*
• Since these users might not want your app, it could negatively impact your star ratings

* So if you don’t drive up your rank enough to get a lot more organic downloads, it’ll not be worth it. These people weren’t looking for your app. They wanted something else and had to download your app to get it.

Promotional Companies

I call them promotional companies because they have some unique way of promoting your app. The best of these offer something that consumers like and help developers drive ranking through a big spike in downloads.

The two that come instantly to mind are App Circle from Flurry and Free App a Day.

How Flurry’s App Circle works:

• Flurry’s got relationships with thousands of developers
• They’ve convinced those developers to put a “more apps” button within their apps
• Flurry will promote you in those “more apps” sections on a cost per download basis

How Free App A Day works:

• It is mostly for paid apps. You make your paid app free for a certain number of days
• Free App a Day promotes that now free app to it’s thousands of users and you soar up the charts
• I currently see several apps they’ve promoted in the pass few days (Chop Chop Soccer and Top Girl) in the top 100 free
• In most cases you pay them a flat fee for promotion

Promotional Company Pros

Pros for promotional companies (say that 10x’s fast!):

• You can get your app in front of thousands of users
• You might see a nice spike in app ranking
• You can pay per download in Flurry’s case, so you minimize your risk

Promotional Company Cons

Cons for promotional companies:

• Like all these other solutions you have to have a significant budget to spend enough to make a difference over time
• In the case of Free App a Day, you might create a nice spike, but it won’t last
• Again in the case of Free App a Day, you might upset some users going from paid to free to paid again

So there are many different ways to spend marketing $$$ promoting your apps. Hopefully this gives you some direction in where to start. Best of luck!

Photo credit: U.S. National Archives, edkohler

Tapjoy was started in 2009 and was acquired by Offerpal Media in 2010.  The combined company has since been re-named Tapjoy.  Tapjoy helps companies acquire new users and monetize existing users.

For the purposes of this post, I’m going to focus on how Tapjoy helps app developers.

How Tapjoy Helps You (the App Developer) Drive Downloads

• You set up an account with Tapjoy
• Add their SDK to your app
• Add funds to your Tapjoy account
• Decide how much you are willing to spend per download and per day

From there this is what happens

• Other apps offer their users virtual currency (poker chips, coins, etc)
• Users can download your app in order to get those virtual currency items
• You pay Tapjoy your bid price and they split it with the other app developer
• Based on how many downloads you have, your rise in the app store charts

How it Works for Publishers

Think about the scenario above.

• The company offering the virtual currency is the Publisher
• They earn money by promoting your app
• If you bid $.55 per download, they get a piece of that
• All they “give away” is the virtual currency that the end user wants

What They Say Makes Them Different

• First CPI company in the market and have the largest inventory fill-rate
• 9 of 10 virtual currency apps use Tapjoy — more than 5,000 altogether
• They can drive 100k+ downloads per day
• They have a sophisticated technology platform that optimizes end-user targeting, reduces fraud, and tracks performance

In my experience, Tapjoy has been great to work with.

I’ve talked a lot about the various ways to market iPhone apps. Every day there seems to be more.

In this post, let’s look at Cost per Install (CPI) marketing, so you can see if it could help you.

What is Cost per Install (CPI)?

It’s what it sounds like. You only pay when someone installs (and often times runs) your application.

You pay per install to drive downloads. Downloads drive ranking. Ranking drives organic downloads. This is especially important in the iPhone app store because it is so hard to gain visibility without being ranked highly.

So how do these companies actually drive downloads? Let’s use Tapjoy, a company offering cost per install programs, as an example.

Here is how it works:

• Let’s say you make a Snow Skiing app (my favorite sport) and need downloads
• You get set up an account with Tapjoy
• You install their SDK in your app (the most common way to track installs)
• You fund your account and you are ready to go
• Tapjoy has many many app developers that offer  virtual currency in their apps
• For example, if a user plays a poker app and runs out of chips, they could be encouraged to download apps to earn more chips
• The user can look at a listing of apps (often called an offer wall) showing how many poker chips they can earn per download
• If they download your Snow Skiing app, maybe they get 100 poker chips
• Once the user downloads and installs your app, the SDK in your app notifies Tapjoy of an install
• You pay Tapjoy per install
• Tapjoy pays the poker app company a piece of the money you paid them
• Ideally you, Tapjoy, the poker app company, and the user are all happy

Hope that makes sense. Let me by answering some questions you may still have.

Cost per Install Q&A

What are the pros and cons of cost per install marketing?

Here are what I see as the pros:

• You can drive downloads, which drives ranking, which drives organic downloads
• You can drive downloads quickly…some of these companies can drive huge volumes in a few hours, driving you quickly up the iTunes app store ranking
• You can be both an advertiser and a publisher, so not only do you spend money, but make money

Here are what I see as the cons:

• It costs money
• You aren’t actually driving “real” users, so you have to be sure your overall cost/download is better than if you went without CPI
• It could potentially drive lower rankings if these incentivized downloads give you a 1 star ranking when deleting your app

What questions should I ask of a potential CPI partner?

Here are some questions I would ask:

• How many downloads can you drive per day?
• What is the cost/download?
• How does your program drive downloads?
• Is it incentivized or non-incentivized?
• Can you send me the integration documentation so we can see how difficult it is?

How much does it cost?

I’ve seen CPI programs that range from $.25 to $1 per download and higher.

I don’t get virtual currency…what is it?

Think of virtual currency as play money. In a poker app, you need chips to play poker. So how do you get this “play money”? You can get it by paying real money or doing something for the company with the poker app. So if you download an app for a poker app, in order to get 100 poker chips, you make money for the poker chip app company.

What is the difference between incentivized and non-incentivized CPI programs?

There is a big difference and it’s mainly in the quality of the user you’ll be getting. An incentivized CPI program gives the user some reason to download the app they are promoting. As in the Tapjoy example above, the user will get poker chips ONLY IF they download the skiing app. So the user is less likely to be truly interested in the skiing app.  A non-incentivized CPI program just shows users apps, but DOES NOT give them anything for downloading those apps. That being said, some users will like the apps they are downloading even if the download is incentivized. Also I’m still a firm believer in incentivized downloads because of how they improve your ranking and organic downloads.

In Summary

If you have a marketing budget you should look into marketing with these cost per install companies.

Other questions? Comments?

Important Note!

In May 2011, Apple starting rejecting apps that had CPI offer walls in them.

So this means two things:

1) If you are an app developer with a Tapjoy, Flurry, etc offer wall in your app, your app may get rejected until you remove the offer wall.

2) If you are developer looking to drive downloads using one of these companies, you may need to start looking for other ways to drive downloads.