As some of you may know I have been building web games for different social networks with some friends for the past few months. I have noticed a downward trend in revenue with apps and wanted to highlight it here. To generate a discussion, ideas and possible solutions:
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1- On social networks in general the audiences are low value. These are kids spending money on a certain set of things: clothes, cell phones, food, movies & gasoline. Clicking on ads for other things isn’t that appealing.
2- The older demos are not installing applications. They have the money and/or provide money for their kids who are using the applications.
3- Saturation. There are now 100 million+ new page views a day that cubics, google adsense, lookery, etc…can provide ads for. That drive eCPMS down to ~$.10 or lower.
4- Scale. Your page views aren’t significant enough. Let’s say you can create 100,000,000 page-views a month. At $.10 / 1,000 pvs (eCPM) you are now making $10,000. Considering that might be 1-2 full-time people + hosting costs means you won’t be a trillionaire anytime soon.
– Use your app as a marketing vehicle to your own destination site.
– Reach out to brands (try hard) for individual sponsorships. Great but not too scalable.
– Virtual Goods? It’s huge in Asia. Great read here. Thanks Dave.
– Fun. Do it as a hobby or lifestyle business. Nothing wrong but this will be well suited for college students or part-time hackers.
Any other thoughts?