App Stores Must Go

appstores2014 was the year the industry woke up to the power of mobile app installs, and the advertising platforms that drive them. Facebook’s impressive mobile revenue numbers – 66% of its Q3 2014 revenue and growing  – are a proxy for the mobile economy at large, and while the company doesn’t divulge what percentage of that revenue is app install advertising, estimates range from a third to a half – which means that Facebook made anywhere from $700 million to more than a billion dollars in one quarter on app install advertising. That’s potentially $4 billion+ a year of app installs, just on Facebook. Yow. That kind of growth is reminiscent of search revenues a decade ago.

But as I’ve written before, app installs are only the beginning of an ongoing marketing relationship that an app publisher must have with its consumer. It’s one thing to get your app installed, but quite another to get people to keep opening it, using it, and ultimately, doing things that create revenue for you. The next step after app install revenue is “app re-engagement,” and the battle to win this emerging category is already underway, with all the major platforms (Twitter, Yahoo, Google, Facebook) rolling out products, and a slew of startups vying for share (and M&A glory, I’d wager).

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