The 3 Fundamentals of Profitable App Marketing

Welcome to the RoundSquared Weekly Download Report.

The purpose of this newsletter is to share with app founders and marketers the fundamentals as well as the cutting edge strategies for exponential app growth.

Over the years we’ve had the opportunity to work with hundreds of clients and help scale some of the largest apps dominating the app store today.

This experience has taught us a lot of what works and equally as much about what doesn’t when it comes to scaling apps fast and economically.

Our goal with this newsletter is to help dramatically increase the profitability and effectiveness of your app marketing but sharing with you these lessons.

With well over $100 million dollars of ad spend managed profitably across virtually every platform we believe we’re in the unique to provide unique insights into what it takes to today to make a wildly successful app.

The first of these newsletters is going to focus on the fundamentals of app marketing. Where most app marketers focus on flashy gimmicks to get attention we want to share with you what works. There is a time and a place for advanced strategies but I promise you no clever tricks will get your app results if you’re lacking in the fundamentals.

Most often the secret to successful app growth is not found in interesting sounds “new” strategies but relentless focus on the basics that drive results.

Don’t worry however, once we have a solid base of the fundamentals we’re going to be revealing some of our most powerful advanced methods of growing apps in the current marketing environment as well.

You can expect case study breakdowns of some of the most successful apps today, in depth walkthroughs of powerful marketing strategies, and access to all the tools we have to help apps grow insanely quickly.

In the next few newsletter we’re going to be pulling back the curtain on what it really takes to grow a successful app. Most of these strategies and topics will apply equally to apps that are just starting out and those that have some success already.

A quick disclaimer however before we get started, at our agency we focus on helping apps grow fast. Fast growth typically requires one of two things, either time or investment of capital. This is something you can’t get around like laws of physics. 

Now, you don’t have to work with us to implement these strategies but I want to let you know in advance that they will often require investment to deploy effectively. This isn’t meant to gatekeep anything from underfunded apps, it's just the reality that fastest growth is only possible with funds to invest in marketing.

If your app is just starting out and doesn’t have a ton of funds to invest, these strategies will likely still be beneficial in helping understand the fundamentals of app marketing. There may even be some applicable at small scale. This just won’t be the focus of this newsletter.

The reason for this is simply that at Roundsquared our focus is helping scale high growth venture backed apps. The strategies we share will therefore be focused on addressing the needs of apps in this position.

Great, now it’s time to get to what you signed up for in this newsletter, the proven methods of exponential app growth. 

Over the next few newsletters like I mentioned we’re going to be doing deep dives into the fundamentals of successful app marketing. This again is going to be where almost all of your results come from. Whenever we take on a client that is struggling to get results the first thing we always go back to is these fundamentals.

Here’s a quick outline of what every app needs to be successful with their marketing efforts.

The 3 Fundamentals of Profitable App Marketing

There are three primary factors that drive results of all app growth campaigns. 

The first of these is understanding your ideal client avatar. The second is developing a compelling creative that drives these people to act. And third is ensuring that your product offering has a strong enough value proposition to convert users in revenue. 

In this section I’m going to share a high level perspective on all three and then in future newsletters we will dive into each one.

1. Defined Ideal Client Avatar

The first and single most important fundamental of any marketing strategy is to understand who your Ideal Client Avatar is.

Understanding who your ideal user and customer is will help dictate every other marketing decision you make. It will tell you which platforms you should be leveraging, what messaging you should test, and even how to develop your products' features.

The single most common mistake I see other apps make when marketing their product is not having a clearly defined ideal user. Frequently people gloss over this step assuming they know who they want to target, then moving on to focusing on creative and messaging.

Unfortunately, the challenge with this is that without a clear understanding of who you want to successfully attract you end up with watered down creative that doesn’t convert.

You need to understand your customers almost better than they understand themselves.

Successful ads all have one thing in common, they get attention. There are gimmicky ways of doing this like pattern interrupts and flashy creative but the most powerful option is far simpler.

The secret to developing highly profitable ads is being able to speak so directly to the needs and desires of your audience that they forgot they’re even watching an ad.

Flashy creative will get attention but if you don’t back that up with a real understanding of your potential customers and their needs that attention will evaporate pretty quickly.

Understanding and clearly defining your ideal customer avatar means you need to not just have a rough idea of who you want to target, but you must get inside their mind and their emotions. You must understand the language they use and what motivates them on the deepest levels.

For example, if your app helps people with improving their flexibility it would be simple to assume you’d just create ads that say “improve your splits and flexibility”. This is one level that can work to some degree but to make really compelling ads you must know WHY your audience has this desire in the first place.

Behind the surface desire to improve their flexibility they may want to impress their friends, or prove to themselves they can do something challenging, or remove pain and sleep better. When you develop ads that communicate these messages through stories and visuals you will have much greater success than just directly saying what you do.

The second major way that developing a clear Ideal Customer Avatar will improve your app marketing is that it helps make hundreds of other decisions much easier.

When you’re deciding on what to include in the text for your app description, or what new features to add, or what marketing channels to explore, understanding your avatar makes all these decisions obvious.

As you refine this avatar and focus all your marketing communications and efforts towards them your app will become increasingly magnetic to those individuals who are a perfect match. This will increase your conversion rates, reduce costs, and dramatically boost profitability.

Here’s some quick questions to help you more clearly define your Ideal Customer Avatar.

• Why does this person really care about what your app provides?

• What questions do they commonly have about products like yours?

• What frustrations have they had with other products in the market?

• Where do they spend most of their free time? What communities are they part of?

Once you've clearly defined your Ideal Customer Avatar the next step to successful app marketing is developing compelling creative. 

2. Developing Compelling Creative

Developing compelling creative is critical to standing out from the crowd in the modern era of app marketing. Consumers have more options than ever before and attention is harder than ever to capture as a result.

We’ve already discussed how understanding your audience is the first step to creative compelling creative but now we want to dive deeper.

There are three elements we look for in all strong creative. Missing just one of these will significantly impact your chances of success and profitability. Hitting all four will virtually guarantee profitable marketing and rapid growth.

The first element is Relevancy. It’s critical to understand that when your potential users go online they’re generally not there to consider downloading a new app. They’re on social media to be entertained and have social interactions with their friends.

For that reason the first question you must make sure all creative answers almost immediately is “Why is this ad relevant to me?”. If your ad doesn’t immediately let someone know who it is for and that doesn’t line up almost perfectly with the person watching it, you’ve already failed.

One of the simplest ways to communicate relevancy is to start by describing the problem or need that your app solves. You don’t want to do this however with tacky direct language that screams ad. The ideal way to do this is to tell stories and show how you can help them.

That leads us to the second element of highly effective creative which is Authenticy. With the amount of advertising in our world today people are conditioned to ignore 99% of marketing. Just watch anyone scroll TikTok or Reels and you’ll see how fast people can identify and skip anything that even remotely feels like an ad.

That’s why if you want your app to stand out and hold attention it is critical to come across authentic and trustworthy. Your potential users have likely been burned countless times by promises in ads that didn’t materialize. Their trust is at an all time low. 

In order to gain their trust and drive profitable downloads it is critically important that you focus on sharing relevant authentic content that communicates the value of your app. 

Fortunately it is easier than ever to find and develop relationships with great content creators in almost every industry today. By creating partnerships with them to develop compelling authentic creative you’ll dramatically increase the effectiveness of your marketing efforts.

The third element of compelling creative is making sure it is Intentional. Every creative that you develop should be strategically planned and aligned with your marketing strategy.

Far too frequently when we take over a new client’s account I’m surprised by the lack of intentionality with their creative. Most people unfortunately use the “throw stuff at the wall and see what sticks” approach to creative development. You can imagine how wasteful this is.

Each creative you spend time, energy, and money developing should have a purpose. It should be pushing your marketing strategy forwards and helping you learn something new.

When developing new creative for your app make certain to always have something specific that you’re attempting to learn with it. This will prevent you from getting stuck in the cycle of producing repetitive creative that is only marginally different than your current stock.

Every week we’re looking at the past week's performance for our clients and reviewing creative. Then based on that data we go to work strategically designing new briefs to continue our testing process. When you approach marketing this way you’re basically guaranteed to succeed.

Once you have clearly defined your Ideal Customer Avatar and have committed to the process of developing compelling creative there is only one step left.

3. Strong Value Proposition

The final fundamental of every successful app marketing effort is having a strong value proposition for your product. Nothing else matters unless you get this part right.

A strong value proposition means:

First, that your potential users and customers can easily understand the value of what you’re offering. You don’t want people to have to figure out how your app can make a difference in their life. This has to be incredibly clear and the rewards have to be near immediate.

Second, they have to be able to easily judge that the value they’re getting from your product is at least worth the cost they’re going to have to pay. Ideally you want the perceived value of your offering to be significantly higher than what you’re charging for the product or service.

Without a strong value proposition none of your marketing efforts will move the needle in your business. In fact, nine times out of ten, when we have a client struggle to get results it isn’t their marketing that is the problem, it's the product's value proposition.

We frequently have clients where from an ad perspective we have a wildly successful campaign. Cost per install will be well below industry average but we’re still not profitable. The problem in these situations typically lies with the product's value proposition.

There are three major ways to improve your value proposition to make certain that your app marketing efforts are successful.

1. Improve The Communication

The first thing we typically look at when working with a client to help them improve their value proposition is actually not changing it. Instead the first thing we focus on is improving the communication of it.

We’ve found that the majority of apps have far too much friction that stands in the way of their users having an “ah ha” moment with the product. It’s not that the product isn’t good, or even that the value proposition isn’t good, it’s simply that it’s not being communicated well.

As a rule of thumb you want to remove all unnecessary steps between your user first opening the app and when they can experience the core value of it. Every unnecessary sign up form or onboarding screen should be eliminated to let users experience the value of your app fast.

Trust me, there is almost nothing worse than spending thousands of dollars to drive a ton of users to your app, only to have almost all of them delete it after a day. When this happens it is very often because they didn’t get to experience the value of the product easily enough.

If you’re struggling with converting users, first focus on removing friction for new users. Then once that is done, shift your focus to improving speed and ease of getting to that “ah ah” moment where they can clearly see the value for your app.

2. Changing The Price Point

The second they do when working to improve our clients value proposition is to look at their pricing model. This is often the second highest leverage tool you have to increase conversion and start generating paying users.

Remember we purchase products when we believe the value they provide is greater than the cost to us. That means to increase sales you can either increase the value your product provides or lower the costs you’re charging for it.

Only you are going to know the margins for your business and where you need to be price wise to be profitable but I’ll provide some general recommendations here.

In general I’d recommend starting with as low a price as possible when looking to optimize your product. The reason for this is that if sales are not where they need to be, it’s far better to get a ton of new paying users even if they’re worth a bit less, than to get none at all. 

Once you have users you can use analytics tools and surveys to find ways to improve their experience and increase the value of your app to be able to raise prices.

The next thing I would test is the positioning of your price points. There are a ton of ways you can charge basically the same price but have it perceived differently by the consumer. 

For example you can charge $60 per year or $5 per month. One of those may be way more attractive to your customers and lead to a huge increase in sales.

Another example would be promotional discounts. For example $50 per year at full price looks way different to potential customers than $100 per year at a 50% discount. At the end of the day they’re the same revenue but often the performance will be very different.

Now in case you’re wondering, these concepts of value and cost do apply equally to other monetization methods. If you monetize through ad revenue your app still has to provide enough value to keep users there for you to get paid. If you increase the cost (by adding too many ads) then users will leave out of frustration.

3. Improving The Product

Once we’ve done our best to improve the communication of the value of the product and optimize the pricing, the last fundamental left to cover is the product.

Your product will always be at the core of what determines your success with marketing. Contrary to what some people may believe, great marketing can’t save a product that the market doesn’t want.

This is especially true for apps that often have to keep customers and have low enough churn to be profitable long term.

For that reason it is critical that before you invest heavily in any marketing efforts you make sure you’ve developed an incredibly desirable product.

In fact when we work with early stage venture back start ups a large part of our initial marketing isn’t focused on sales, it’s focused on driving users for feedback.

Early apps often struggle because they need to attract users to help inform the development of their product but they lack the budget to do so. It is incredibly difficult to optimize your product when you’re only getting a few new users each month.

Marketing however and open the flood gates and get you the users you desperately need to learn more about what the market wants. This will help inform feature development, monetization models, and help identify issues faster.

One of the biggest mistakes we see apps make is actually pausing all marketing and going into “stealth mode” to redesign their product. When apps do this they typically end up wasting months and racking up huge development costs only to find out that the market still isn’t responding.

That's why we always recommend leveraging your marketing budget to iterate your app in rapid development cycles. This way you can be responding to real user feedback and tracking key metrics as you go.

The apps that focus on this approach typically achieve profitably much faster and due to focus on their customers typically end up with a much better product.

Well that’s it for this first newsletter. We’ve covered a lot and I hope this gives you a good idea of some of the fundamentals of successful app marketing.

In the future we will be doing more deep dives on our processes for defining your ideal customer avatars, developing compelling creative, and optimizing your app.

The goal of this letter was just to give you the foundation of the core principles we look to achieve the incredible results we get for clients.

Over the next few weeks we’re going to continue to expand on these topics. We will be covering topics such as the common mistakes we apps make when trying to achieve hyper growth. We will be sharing how we plan which platforms to pursue.  And we’re going to be revealing some of our cutting edge strategies for achieving incredible profitable results.

We look forward to hearing from you in the future and if there is anything you have questions on and would like us to cover in this newsletter, definitely shoot us an email!

Best,

Patrick