Ask the Developer: How SmartNews used smart UA to scale its app in a crowded market

AppLovin is a global brand and platform, which means we have the opportunity to work with developers from different markets all around the world. In our Ask the Developer series, we speak with developers to learn their strategies, best practices, and expert insights.

For this installment of Ask the Developer, we spoke with SmartNews’ Head of US Marketing Fabien Nicolas about the challenges of building an app in a crowded marketplace while finding success with a good user acquisition strategy. Founded in Tokyo, Japan in 2012, SmartNews set out to create an AI-powered news app that helps users discover diverse news.

It’s easy to see the uphill battle SmartNews faces with both Apple and Google providing their mobile users with curated news built into the operating system. However, SmartNews found that using video ads and promoting its app in mobile games resulted in doubling their daily active users (DAU) in the last 12 months.

The following is our conversation with Nicolas, edited for length and clarity.

In such a crowded news market, how does SmartNews stand out?

It’s a challenge for us to compete with news sharing platforms like Twitter and Facebook, but also having to worry about the news apps from established players like AOL and Yahoo. However, these apps don’t stand out in the market. Our challenge is to find a way to differentiate ourselves, and we’ll inevitably turn off some users, but we’ll acquire ones that stick around.

The biggest way SmartNews stands out is by maintaining our independence both from media and from platforms. And thanks to the revenue that we’re making in Japan, we’re allowed to create a virtually independent news source without having to compromise on the quality of the information we deliver.

With the tumultuous 2016 election, we’ve seen a renewed desire for people to find politically neutral news. The quest for truth matters, and SmartNews will challenge your perspective with our Top 15 news articles, which is a mix of stories across the political spectrum. You could be a climate change denier but you’ll still see stories about climate change from both sides of the debate.

We want people to break out of their filtered social news bubbles and to see us as the best news discovery network. To achieve this, we’ve partnered with over 250 major news sources in the US and we use our machine learning technologies to help readers discover news.

What were the main challenges of bringing SmartNews to the Western market? How are the use cases different compared to Japan?

In terms of different use cases between the US and Japan, we’ve found that Japanese users often use SmartNews for consuming buzz-worthy content like entertainment news. In contrast, US users tend to prefer hard political news stories. This has created a need for a different marketing strategy in each region. In Japan, we’ve already reached scale after having marketed online for over four years. Now our objective is to scale efficiently on the mobile side and get to the level of Twitter Japan and LINE.

It’s interesting to note the differences between the ages of users in both countries; Japan’s age distribution is basically a bell curve, which is diverse, but the US audience is mainly 35+ years of age.

Additionally, we found that it’s easier to scale on Android than iOS because on iOS, Apple News is baked into the operating system. Google is a bit more open, as you can download Google Newsstand if you want, but you can get your news from a number of apps. Looking at our competitors, we found that they were having similar challenges with iOS and found Android to be a better platform for scaling.

How has your user acquisition strategy helped scale in the US?

Using AppLovin for our UA efforts, we’ve more than doubled our daily active users within the last 12 months. SmartNews is back on the map in the US thanks to the ongoing fight against fake news, and we hope to double the DAU number every year.

In terms of which ad formats work the best, we found that in general, video performs better. We optimize our ad spend by analyzing our return on ad spend (ROAS), and more specifically, the first seven days of user engagement and retention.

In contrast, we’re already market leaders in Japan, so we’ve branched out to using TV ads to try to scale.

One of SmartNews’ most successful mobile ads.

Since you previously worked in the mobile games industry, what are the similarities and differences between UA strategies for a mobile game and utility app like SmartNews?  

Similarities are that you have to analyze on what’s right and wrong with your stack and iterate on your lifetime value (LTV). The baseline for both types of apps is that you have to figure out what your LTV is before scaling.

The biggest difference between the two is that it’s more clear in mobile games who you have to target. For utility apps, you have to be more disciplined with managing your funnel. With SmartNews, I learned that we had to look at more marketing channels than with gaming, as gaming works well with cross-promotion, but a utility app like ours could work better with TV, print media, or we could work with carriers to get our app installed on phones. This is tough because game marketers value targeting. I definitely see more differences than commonalities between the two app categories.

What are your plans for SmartNews in 2018?

For 2018, we plan to be bolder. We want to bring news from both sides to help people make better business decisions, but also to make better decisions about our democracies. To achieve this goal, we’re going to be more vocal about freedom of the press, as powerful individuals are targeting specific media and labelling them as “the enemy of the American people.”

Many companies including Apple, Google, and Lyft took a clear stance against the travel ban and the hate exhibited after the events in Charlottesville last year, and we hope to join them. I hope we can make a difference when it comes to providing quality information to a larger segment of the US population.