TAMZIN TAYLOR: My name is Tamzin,
and I'm a partner development manager for the UK and Nordics.
Now, I've been involved in mobile content since 2001,
and I can tell you I'm so excited about how
well the industry's grown.
And it just makes me really happy
to see the rich potential that we're
building for partners like yourself
in the Android ecosystem.
So I think we've heard a lot today about monetization
and improvement.
Monetization is not just about pricing, obviously.
I think we've heard today some great tips from people,
like Illya Michael, about quality
being the cornerstone of success, things like design,
using the platform tools, like beta testing
and staged rollouts.
And if any of you attended Mateo's session
on engagement techniques, it was absolutely fantastic.
So things around understanding your users
to drive engagement retention and understand lifetime value.
So-- let's see, is that-- so let's look
at the growing opportunity now.
I know that we touched on this earlier in the day.
So in Mark's welcome speech, he gave you an idea
of the growth of the Android.
And I guess, what I'm trying to get across here
is there is a massive capacity to earn,
and there are increasingly more ways for people to pay.
I know we touched on this earlier,
but local forms of payment, like direct carrier billing,
gift cards, and PayPal, are opening up new audiences
for you to target.
And I've actually seen with my own eyes,
when we launched a new form of payment in New Zealand,
we actually got new users in incremental sales.
So we're actually opening up new audiences for you
to sell to in New Zealand.
They buy content.
So we're seeing great success today.
Just a couple of key pointers.
We've unlocked the domestic market of Germany.
When we launched a new local payment,
we saw a 70% growth in year-on-year buy growth.
And one thing I'd like to call out as well is just to show you
that the capacity of play to earn money.
We had 38% year-on-year growth from primarily
international sales.
So given this increasingly global market,
how should you price your quality application?
Note, I said quality, because you've heard everything today.
And I know you're going to go out and implement it.
So the global market is ready for your products.
Your application is built. You've improved the design.
You're using all the platform features.
Pricing for globalization is very important.
And my esteemed colleague, Yashi,
who's getting mocked up somewhere,
is talking after me about go global.
So he'll tell you more information
about other factors on that.
But I'd like to start with a few key points
on setting and managing your prices.
Now, you may say to me, ah, Tamzin, that's common sense.
And some of it is common sense, but you'd
be surprised how few developers actually implement it.
So I'm going to call them out today really quickly,
and you can tell me to sit down if it's boring.
And these will include matching the model to the market,
taking into consideration purchasing power parity, which
is how much consumers can afford, local price
preferences, as [INAUDIBLE] mentioned,
will be the $0.99 not going well in Japan, audience
segmentation, and just checking in on your pricing strategy
regularly.
So to kick things off, matching the model to the market.
So we know that there are multiple ways to bill customers
at Google Play-- free, freemium, premium, subscriptions,
et cetera.
So it's really important to make sure
that you carve out a pricing model that's
going to meet the cultural and economic factors
within that country.
So if you were targeting a country that
has very high prepaid penetration and perhaps very
low credit card penetration, you might
want to consider more transactional type of payment
models, like in-app billing or premium,
to take into account perhaps the less regular cadence
of top apps they might have on their phone.
And of course, the model should support the value proposition
of your content.
For example, if you have a subscription offering,
make sure that the content or the functionality
is refreshed regularly, or that the user has a reason
to go back into it daily to get value out of it.
Hands up here.
Who has heard about the minimum price reduction in India?
Excellent.
And who actually did lower their price and go into India?
Fantastic.
If I had a fruit basket, I'd give you one.
So what we did recently is we lowered the minimum price
that you could charge out on the Google Play Store in India,
from 50 rupees to 10 rupees.
Now, I guess, to put it in context, a can of Coke in India
costs about 10 rupees, but it costs $1 in the US.
So OK, that's fine.
That's fine.
But we know that, actually, $1 US equals 66 rupees, if you
take yesterday's exchange rate.
So then, hang on a sec.
So they're charging 10 rupees in India, but 66 rupees in the US?
So what we're seeing here is a clear example
of Coca-Cola basically pricing to what the market can afford,
purchasing power parity.
So that's kind of what we were trying to get at,
is we know there's a market exchange rate,
but there's always a soft consumer price that kind of
will get you more conversions.
So some results after we launched the minimum price was
that, after four weeks, we had 560
titles across 220 developers that
changed their prices for India.
So you're one of 220, sir.
And as a result, we've seen an 800% increase in revenue.
I mean, that's outstanding.
And the great thing that we like to point out
is-- are you're based in India, or the UK, or EMIR?
AUDIENCE: [INAUDIBLE].
TAMZIN TAYLOR: UK.
So you're one of the 75% of those 220 developers
who actually changed their prices for the Indian market.
So it's a very international market we're happy to see.
One call-out I'd like to make is Nova.
So Nova do a browser launcher.
And they originally were priced at $499 USD,
which equated to about 325 rupees.
That's like 32 cans of Coke.
So they took advantage of this offer,
and they changed their price, I believe, to 15 rupees.
And you can see the impact there,
a 136% increase in orders and 27% increase in revenue.
So again, a very happy developer.
Oh, and it's live.
So if you haven't done it yet, and you still
want to target India, you should get in there.
And we know that many of our top partners
are doing their own testing on prices across the world.
One amazing learning application did some ABCD tests
in the US and Russia recently.
And they found that, for the USA,
they tested four different price points,
and the optimal one was 23% lower than their original.
And that generated them 95% increase in conversion
and 52% increase in RPU.
Similarly, for the Russian tests, it was a 12% drop.
You can see the stats there.
So I guess the caveat here is, don't take these price
drops as what you should do, because your content is unique,
and your markets will be the ones you choose.
But if you can find a way to test different prices
across your markets, we recommend
this is the way to find the optimal price
to help you increase conversion and gain incremental revenue.
Now again, we touched on this earlier a bit.
So you know, I'm from Australia, not New Zealand.
And one thing that really annoyed me is I'd
go into the Play Store and I'd go in looking for an app,
and then find the app.
Fantastic.
And it would say, you'll be charged $1.16, or $3.74.
I'm like-- [GROANS].
I kind of feel like the developer
doesn't care about me.
And we know from what we discussed before,
that in Japan, they prefer whole figures, like 700 yen,
not 701 yen.
So in the Developer Console, we actually
enable you to customize the prices
of your in-app SKUs, or premium prices, or subscriptions,
by country.
And the great thing about that is you do it once,
and then we will, on our side, convert that
to the local currency so that, when
users see an optimized price and a value offering that
works for them, they're more likely to,
if they like the content, to make the purchase.
And who here attended Mateo's talk about engagement?
Excellent.
OK, so this may seem familiar territory,
but I just want to touch on it again,
because it's so important.
So we know that users are not homogeneous.
It's best practice to know who your customers are,
what their behaviors are like, and what they'll pay.
If you can do this, you can carve out different strategies
to help them along the purchase journey.
Mateo talked a lot about Google Analytics,
but any analytics are important.
And really, if you can find a way
to differentiate your segments to then identify
who are the spenders and who are the non-spenders, who
are the engaged and who are the not engaged,
and then present them different offers,
we've seen good success.
So Wish, for example, used this system.
And for those of you who weren't in Mateo's speech,
Wish basically created different product offers,
so cheaper offers for less engaged users,
and more expensive product offers for the more engaged,
and saw a 10% increase in conversion.
Anyone sell to Russia here?
A few.
So you're probably familiar with this graph.
But essentially, one of the last best practice
pricing initiatives is really to check in on your pricing
regularly.
For example, if a developer set their price
in 2014, February 1st, and didn't change it for a year,
they would have seen their gross revenue
from Russia nearly half, because of the four exchanges.
So we recommend going in and checking your pricing
regularly, so you can see where you are versus your competitors
and versus the exchange rate fluctuations.
So we've just touched on all the best practices.
And I'm running slightly late, so I'm going to continue on.
The running theme here is that not all users are the same.
They've got different price sensitivities
and different needs.
So how can you deal with this, when you're
talking about a global market?
So I'm going to touch now on AdMob,
and then give you a bit of an update on what we're
doing with subscriptions.
Clicker, come on.
OK.
So anyone here use AdMob?
And I won't be upset if you don't.
Great.
Excellent.
So AdMob, for those of you who don't use it,
is our industry leading ads and mediation platform.
It's earned over 650,000 developers over $1 billion
in the last two years.
And as you can see here, the growth statistics
are very, very impressive.
And it tells us a bit AdMob, of course,
but it really tells us something about the ecosystem.
And what it says is that advertising
is a very important part of that monetization,
and it's growing each year.
In fact, Gartner predicted-- and this
is Gartner-- that by 2017, they'll
be nearly 270 billion app downloads.
And the majority of these they think will be free in premium,
or freemium.
And with the growth in free and freemium, of course,
is the growth in mobile advertising.
So we talked about consumers differing between markets
because of disposable income and cultural differences,
but we believe that you shouldn't
be forced to choose between only monetising
through in-app advertising, or through ads.
But to date, we haven't really given developers
the option, until now.
So AdMob actually is trying to help you find
the right monetization model.
It feeds in the opportunities, processes the information,
looks at your ads, your app, your users,
and your advertisers, and then will deliver
the right experience to them.
So what this means, in a nutshell,
is that you can have it set up in your apps
so that either users, who we identify
being as high spenders, will see an in-app purchase
ad for your product.
And those who we identify as being low spenders,
will simply see an AdMob ad or one of your third-party ads.
In this way, we try and help you monetize all users, not just
the high spenders, and not just those who
are not going to spend.
So this is another example of a tool called, Audience Builder
within AdMob that allows you then to go in
and, I guess, fiddle and create deeper segmentation
for your audiences, to give them different offers.
And one example here is that, if you do have very high paying
users, you might not want to show them ads at all.
And the AdMob platform allows you to do this.
So in-app purchasing and adds, two great ways to make money.
But there's a third one.
Who here likes recurring revenue?
Excellent.
So let me tell you a bit about subscriptions.
Another question for the team.
Who has a Netflix account?
Fantastic.
Who's got a mobile plan?
So you can see here that subscriptions
are tried and tested model that people are quite used to
and they like.
From a user's perspective, it's great, because then there's
no bill shock.
Once you've signed up, you can expect
to get free access to the content, ongoing.
Furthermore, it builds trust in the brand.
For developers, recurring revenue
gives you greater certainty around your cash flow
and helps you forecast your investment in Android.
And did you know that subscriptions are actually
the fastest growing business model in play?
You see the statistic here.
We had 2 and 1/2 times growth in subscriptions
between 2013 and 2014.
And we think this is due to a couple of factors.
The first factor is that people are becoming more used
to paying.
And the second factor is that leading developers,
like yourself, are improving the quality of the applications
that you put on the Play Store.
So a big thanks to you.
A couple of case studies I'll call out,
because I know I'm over time, is that Busuu,
one of our good partners, actually
has invested so much in their Android application
over the last year.
And their focus has really been about improving the onboarding
flow of users to sign up to subscriptions.
And what they've done is they've overhauled their design so
that users can really see the value that they're
getting for signing up.
So there's a large portion of free,
and then it's a graduated call to action.
"New York Times"-- I have to say this is fantastic--
but they were using a payroll, and moved across to Google Play
billing.
And they actually reduced their sign-up flow from two minutes
to three seconds.
And this speed of sign-up has been due to the fact
that all the customers signing up already
had a form of payment on the Play Store.
And that resulted in 125% increase
in subscription conversion.
So it takes a functionality to build a successful subscription
business.
There's grace periods to help people
who may be run out of-- there might be a prepaid top up,
and their DCB, Direct Carrier Billing, doesn't work.
Or it might be someone who simply has not
paid their credit card bill.
So with grace periods, you can give them a chance to fix
their form of payment, without cancelling their subscription,
which works for the user, and also works for you,
because you've got less churn.
Goodwill credits are really great for rewarding people
who've done a good-- customers who've given you good feedback.
And upgrades and downgrades are one way to, again,
ease people up the purchaser uphill journey.
And of course, this is the one slide
I was really keen to share with you today.
But I'm really, really, really pleased
to announce that, as of tomorrow,
we'll be launching quarterly and six-monthly subscription
periods.
[AUDIENCE APPLAUSE]
And you can use these to do many, many different things.
I mean, the first one is psychological pricing.
So you can look at the way that you price your packages,
and make it more attractive for someone
to sign up to a six-monthly, versus a quarterly.
And again, what we hope to do is, in this way,
give you more flexibility on your monetization options.
So thank you, very much.
I'm sorry I went over, but I just
want to touch on the wrap up, which is, number one,
Google Play is a growing market.
And I think we've touched on that many times today.
Pricing is one lever for monetization,
but quality is one of the key elements to consider.
And you can achieve success by following some best practices.
And please consider the subscription models
that you can now use.
Thank you.
[AUDIENCE APPLAUSE]
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