Rovio: no secret sauce for apps success

15 FEB 2011

Mikael Hed, CEO of Rovio, told the audience at App Planet Forum that “there is no super secret sauce”  to guarantee that an app will be a success, but that the basic needs of a successful product are clear: “at the end of the day, it is really about making great apps and finding a way to get good visibility.”

“It’s some knowledge, a lot of work, and it takes a little bit of time,” he continued.

Following the success of its Angry Birds franchise, Rovio has become something of a hero in the mobile apps market – from a competitive marketplace of hundreds of thousands of apps, the company has been able to create massive volumes across multiple platforms. Hed said that the Angry Birds has generated some 35 million downloads, using a mixture of paid and ad-funded models.

Although there are numerous business models available to support mobile apps, there is one common criteria: the need for volume. Hed argues that through this need of a large audience, the model for the mobile app industry is “something that is closer to television than gaming.”

“In the current situation there are hundreds of thousands of competing apps out there, how do you get visibility? There is no easy answer. Every app must find its own way,” he said.

However, the desire to achieve these volumes has placed significant downward pressure on prices, making it more difficult to build a business based on a pay-per-download model.

 “The standard pricing is fast becoming free, and the premium price is $0.99. If you price yourself higher than that, you risk falling out of the top ranking very fast.”

As a result of this price pressure advertising has become a more popular option, with the launch of Angry Birds on Android supporting ads. But in order to build a successful ad-funded business, again achieving significant volumes is critical – advertising is viable for “very popular apps.”

But this desire for an audience should not negatively impact the quality of an app, he warned. “It needs to be optimised for the end user. That is very, very important. That is our driver, always thinking about the end user and what gives value for them. Not ‘how do I make a buck off of it?’ Because that comes as a natural side effect when we do our job well.”


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