Mobio Talks with CEO Appnext about the CPI market and trends in the mobile applications industry

    The CEO of Getloyal, Alexey Pisarevsky, in the framework of the Mobio Talks project, interviewed the CEO of the Israeli platform for the monetization and promotion of mobile applications Appnext - Elad Natanson.

    In an interview discussed:

    - Prospective markets for the development of mobile products;
    - Bootstrapping and investment;
    - Trends in the mobile industry;
    - Super Apps and Instant Apps;
    - CPI market and attribution models;
    - And much more.

    In the video there are Russian subtitles, and under the cut you can read the text transcript.

    Pro Appnext Team and Market Development

    How long have you been working in this office in Israel?

    About two years.

    How many employees in Appnext - more than a hundred people?

    Yes, there are 120 employees at Appnext. And we continue to hire.

    You call the company's employees "AppNext". Who is the perfect appntexter for you?

    We value creativity, ambition, team spirit, flexibility in many aspects. People who come to the office in the morning with an understanding of what needs to be done, and, of course, with a desire to work.

    Who would you not have taken?

    Indifferent people. Those who cannot be part of the company will not invest, will not enjoy our tasks. People without enthusiasm - those who believe that working means sitting at the table every day. We are looking for those who seek to develop and invest, and you can sit at home.

    Does it happen that at the beginning an employee is very active, but after a while his interest disappears?

    This happens. Our task in this case is to figure out how we can help. First of all, you need to understand how well the employee understands his role and goals, as well as how his work is evaluated. If it is not possible to solve the difficulties, we always strive to offer such employees another position in the company. Some of our employees moved from one department to another, and in some cases this promoted career growth.

    In addition to the main office in Tel Aviv, Appnext has five more offices - in Beijing, Seoul, San Francisco, Lviv, Cyprus, right?

    In fact, there are seven of them - two others in Japan and Bangalore.

    With Beijing, Seoul and San Francisco everything is clear. With India and Japan, too, there are local markets. Lviv - R & D center. But why do you need an office in Cyprus?

    Cyprus is a special place for us. There I personally opened our first office outside of Israel. That was 14 years ago. We then thought about where to place the technical support team and the advertising department, and stopped in Cyprus. That's why we have an office there. Technical support works in shifts practically around the clock, helping users to work with the platform.

    And how are things going in China? There is a difficult market.

    In China, it is difficult to work only if you do not understand culture. The Chinese market is amazing in terms of people, their ambition, the desire to expand, to conquer the world. Actually, it seems to me that the Israelis and the Chinese are in many ways similar. If you have your own office, the right people in a team and a well-built infrastructure, no difficulties are terrible, and then you can manage great things.

    What infrastructure are we talking about? Share examples?

    Communication at the local level is what matters most. In China, we immediately managed to assemble a team of professionals, and we continue to replenish it with new talents - precisely because of this, we managed to achieve success in recent years. Without the office and the team, this would not have happened, but if you work with the right people and companies, there is no limit to opportunities.

    How many people work in the Chinese office?

    Ten in Beijing, and another in Shenzhen.

    What can you say about the Russian market?

    This is one of the strategic markets for us, in terms of growth and activity, it is in the top five. The Russian market is strategic in the sense that we are making a big bet on it for the next couple of years. We cooperate with the largest Russian developers and publishers. We are interested in OEM-companies - our Appnext Actions product was created for them, and we are actively working to implement it in Russia. In the next couple of years, this market will definitely grow rapidly in terms of increasing the number of mobile devices, and in terms of increasing marketing budgets.

    Where will the next office be?

    We are thinking about Latin America - most likely in Brazil. Or in Europe.

    Many companies that have opened international offices face difficulties in finding a manager. Do you have the perfect recipe for such cases?

    At such positions it is necessary to look for people close in spirit. What a manager, such an office, so this person must share the values ​​and culture of the company.

    Do you hire local professionals?

    Is always.

    Have you ever made mistakes or something went wrong when you made a decision regarding the office manager?

    Errors happen, but in our case problems arose because of the location of the office, and not the employees themselves. When we started in China, it seemed to us that it would be best to open an office in Shanghai, the global financial center, and not in Beijing. We worked in Shanghai for a couple of months, but quickly realized that most of our partners were from Beijing, so we decided to move there.

    The team remained the same?

    Yes, it was at the very beginning of the office.

    About investment and boostrapping

    I have not found information on whether you use external investments.

    Appnext works on the principle of self-financing. Back in 2012, we decided on our own, brick by brick to create a platform for mobile applications. And I founded my first online business 17 years ago.

    So you used your own funds? Was there a large amount?

    Yes, over the past few years we have invested a couple of millions in the company - entirely on the principles of self-financing, one might even say, bootstrapping. Because of this, we have freedom of action.

    A couple of millions - this is not quite bootstrapping! Does the company make a profit?

    It brings, but now it is not the main thing for us, because the company's goal is strategic development.

    What do you have in mind?

    We are looking at growth, how the platform is developing, how many users and partners use our technologies. Profit and loss account is not so interesting.

    Considering the possibility of attracting additional funding?

    Now there is no, despite the fact that we are constantly making offers. About once a week they write: “Hi, we would like to know the details and, possibly, invest.” We thought about using external investments for the development of our technologies - this would require substantial amounts. Perhaps in the future we will hold a round, but for now it's too early to talk about it.

    About industry trends and new product launches

    A year ago, you began to actively promote Appnext Actions, but I did not find cases for implementing this solution. Maybe you tell about the successes?

    We have a couple of case studies from OEMs that supply devices with the Appnext Actions widget preinstalled. There is Dailyhunt, the most popular news app in India. Some of its components, in particular menus and articles, are integrated with Appnext Actions.

    How does this integration work for Dailyhunt users?

    The Actions solution is designed to create integrations between services. Initially, Appnext was a platform that helped users find new mobile applications and re-use already installed ones. Appnext Actions is a step forward that allows you to integrate services among themselves or as part of Super Apps. Through the Dailyhunt app you can order food, shop, pay for tickets, book accommodation. Therefore, instead of simply allowing users to learn about new applications from Dailyhunt, we allow them, for example, to buy a plane ticket directly from the application in one motion. The next step is to make these features available on the device immediately after purchase. In this case, you will not have to download anything - everything you need will already be at your fingertips.

    What is your platform for?

    We give access to such opportunities. We do so that the user receives the desired service at the right time.

    What about service providers? Is it possible to create an application for your platform?

    Can. If you are a service provider and want to integrate your solution with Appnext Actions, there are several ways to do this. First, if your application supports instant launch, you will be able to reach millions of devices in a short time since our solutions allow users to immediately take advantage of your application. Another way is through your API. Using your API, we will develop for you a mini-application that can be used just like the application itself. Through the web interface we created, every user action will be connected via API with your application. Essentially, the gadget will mimic it.

    Looks like the way it works in Facebook Messenger. Perhaps this is the future, but now, in my opinion, it is more convenient to use a separate application.

    Install a full application and work with it?

    Yes, that is right. The user can install and normal application. But we see it this way: sooner or later, most applications will be used only once. Take, for example, travel applications vertical - the average user reserves a hotel room twice a year. Now it happens like this: you install the application, look for the right hotel, meditate for a couple of days, and then delete the application. We give the opportunity to book a room instantly from the application where the user is located.

    But such applications are not downloaded in order to use every week, but in order to get high-quality user experience, UX. Isn't it more correct to offer at least something similar?

    I completely agree, and we are working on it. At the same time, we try not only to make the experience of interaction with mini-applications as complete as possible, but also to offer the user additional benefits. That is why using Super Apps is more convenient than installing a new, unfamiliar application.
    In my opinion, in the future, Instant Apps will solve this problem, but this largely depends on how actively developers will use the Google Instant App API.

    So, in your opinion, the application industry is moving in this direction Instant Apps and Super Apps?

    That's right, and I'm not the only one sure about this. Google has a similar vision. We would like to become a driving force that would stimulate the development of Super Apps, which would combine various tools: instant messengers, launchers, news apps - to enable them to become super apps themselves.

    Pro CPI Market

    What is happening with the traditional CPI market? Many complain that it stopped growing at a pace that was two or three years ago. Advertisers transfer budgets directly to Facebook and similar sites. What do you think of it?

    In my opinion, somewhere in the end of 2017, a turning point came for the market for attracting users to mobile applications. Today, marketers, developers, advertisers understand much better how online advertising works, how to protect themselves from fraud. The market is in a situation of high demand. Advertisers are interested in constantly attracting new users. They have already managed to spend some money on campaigns on Facebook and Google.

    The level of efficiency of CPI-models increases over time and will continue to grow. The cost of media for existing brands is increasing, so brands are looking for new ways to spend marketing budgets wisely. Thanks to the availability of information, they are looking for certain services or platforms that can contribute to their product and increase its value, instead of wasting money and risking reputation. Many dishonest companies have collapsed in a couple of years. But those who know how to work with media and technology to benefit the client are very successful. Of course, not all difficulties have been solved yet, including those related to erroneous attribution.

    Share your vision regarding attribution.

    This is an extensive topic. In general, when mobile marketing appeared, advertisers wanted to pay for the installation of the application, and not for placement in the media, because they themselves could instantly track the installation with the help of third-party agencies. At some point, everyone suddenly wanted to work on the CPI model, and some companies that did not even know how to work with the media began to abuse the situation. For them, the motivation was the desire to increase the number of installations instead of showing valuable advertising to its users.

    With the CPI model this happens all the time.

    It's true. The reason is the wrong motivation. In my opinion, with regard to attribution and the current marketing structure in terms of price and how companies work, the following is happening now: for companies that create value through media, attribution is divided between self-attribution companies, such as Facebook and Google, which find the right way to measure their contribution, and companies without self-attribution. Due to dishonest players, the latter have a lower level of attribution. Therefore, their advertising receives less value than it should, because of what an imbalance occurs in the market: real media have a low price and create less value for publishers and developers.

    If we are talking about media, you started as a DSP platform, focusing mainly on customers and advertisers. Now, it seems, the focus has shifted towards suppliers and independently collecting ever increasing volumes of traffic.

    We started as a platform for mobile applications, which primarily provided solutions to developers. Then we were the platform on the supply side, and the platform-side functionality was added at the end of 2015. Now about 45 thousand applications are integrated with our SDK, and these are only Android applications. And every month several thousand new ones are added.

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    Read the full transcript of the interview on AppTractor .

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