Wednesday, July 30, 2014

Is Yahoo entering the heavyweight app league ?

Yahoo’s acquisition of app analytics and advertising company Flurry this week showed just how serious the web firm is about using a coherent mobile strategy to turn its fortunes around.
The company has been busy revamping its mobile offerings and acquiring developer talent and app technology under the stewardship of CEO Marissa Mayer. And this approach is clearly having an effect.
In its second quarter results last week, Yahoo revealed it has 450 million monthly active mobile users, a 36 per cent year-on-year increase, and more than double the figure of two years ago. In addition, the time Yahoo users spend accessing its services via mobile devices has increased 79 per cent year-on-year.
This is impressive progress for a company that was really struggling to convert its previous online prominence into success in the mobile world.
And apps appear to be central to the success of Yahoo’s mobile strategy: it claims to have more than 400 employees developing iOS and Android products, and smartphone users spend 86 per cent of their time interacting with Yahoo within apps.
Recent successes include the Aviate homescreen, which saw rapid user growth in the first week of availability, with those accessing the technology doing so an average of 50 times per day.
The new Yahoo Mail has seen iOS users spending an additional one minute per day using the app compared to its predecessor, with a 65 per cent increase on Android.
Put simply, focusing on apps has been the major driver in the company becoming more relevant in the mobile world.
The Flurry announcement takes Yahoo’s mobile strategy to another level as it is clearly addressing the wider developer community, as well as boosting its in-house expertise.
Flurry’s reach is significant, with 170,000 developers in 150 countries using its analytics tools and a total of 540,000 apps running on the platform.
Yahoo said the agreement to acquire Flurry is “a meaningful step for the company and reinforces Yahoo’s commitment to building and supporting useful, inspiring and beautiful mobile applications and monetisation solutions”.
The proposed acquisition shows that Yahoo wants to work with third party developers by offering analytics services and improved monetisation options through Flurry’s mobile advertising technology.
Yahoo’s mobile advertising play is having success already: its unified mobile search and native buying platform, Gemini, has made a promising start, now accounting for 50 per cent of the company’s mobile display revenue in the US.
The addition of Flurry’s app-focused nous will undoubtedly boost Yahoo’s efforts to become a more important player in the app ecosystem.
Although Yahoo is at an earlier phase, the best comparison is Facebook, which acquired tools company Parse in April last year and agreed to purchase Little Eye Labs, a Bangalore-based start-up that builds performance analysis and monitoring tools for Android app developers in January this year.
Facebook’s efforts recently saw engagement company Fiksu describe it as the most effective channel to promote mobile apps, providing higher conversion rates and better return on investment than other approaches.
Amazon too is becoming a more prominent mobile player with app promotion and monetisation services to attract developers. Of course, the e-commerce giant has the added motivation of stocking its Appstore and a growing device portfolio.
Even Twitter recently got in on the act with the introduction of its mobile app promotion service, through which developers can drive installs and engagement via the microblogging platform.
Out of all the web giants, Google has clearly gone the furthest, developing the world’s most popular mobile operating system and app store, allowing it to have a different and deeper relationship with developers.
Yahoo can’t hope to compete with this (and likely never will), but as a model for how an online search and advertising company can embrace mobile, Google can’t be surpassed.

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