The awkward innovation activity on a simple Alarm Clock APP
This innovation case is about a simple app and how with fundamental steps of innovation we have turned its $1M revenue to an astounding $6M run rate in just six short months .
In 2013 AVG has decided to increase its mobile presence by adding utility apps to its portfolio. That’s how the Alarm Clock has become an asset, where the innovation team had to make it valuable for the company. this post highlights, innovation based on performance discipline and market relevancy.
AVG was an anti-virus company with a freemium offering. since 2003 the company started a race of about 30% YOY growth. In 2013 the company has decided to support the mobile growth with acquisitions of utility apps from the Android Play store (Google Play).
The Alarm Clock Xtream was acquired by AVG based on the main asset it had, which was to be the first result on a search for ‘Alarm Clock’ on Google Play. That has provided 150K new users weekly to the product.
The company held the Alarm Clock asset for a couple years and realized that keeping it with maintenance mode the product will never raise enough money or recognition for the AVG security brand. They have asked to remove the product from the product board and just let it float, without maintenance.
I have thought that it was a bad use of resources as the product produced a huge number of new users, and the strong position in the Google Play Store. I saw this innovation opportunity, and used it, I asked the company to to turn the product to Innovation Labs, once there were no external barriers to doing so. The main question was, how to convince the team that we can innovate on an old existing basic function as an alarm clock?
The first stage was to run market research in which we looked at all the apps providing alarm clocks finding out what they added to make it more appealing. The other apps had to be more creative to drive users in as they were not as high in the Google results like we were. As part of the research, we also looked at different monetization methods of mobile alarm clocks, our app had used only badly selected ads from the AdMob platform by Google.
Although we were inspired by the mobile app world, we also looked at the broader concept of sleep and sleep quality, to get inspired by the functions of sleep, wakeup, going to sleep and the quality of it.
The conclusion to the research, was that the alarm clock should be sleep quality. The topic is a never-ending issue for people. It is related to the audience we are reaching, and there are many ideas on how to turn the phone to a sleep assistance. Not just to a wake-up machine, but more a sleep-quality measurement device. We learned that for better sleep functionality people are willing to pay more.
We have formed a team of: a product owner, two app developers and finally an electronics engineer. The target was very clear to increase revenue per user and in general. The leading strategy was to first improve ad performance while developing the sleep measurement functionality. Once we introduced the sleep tracking functionality, we have launched a paid version that was promoted from the app. After 4 months we already were in a run rate that was close to 6X the revenue we have had before.
The R&D work was optimized into a bi-weekly sprint that produced a new release. Performance measurements were put in place to measure everything in the app, placement of the ads, choice of the best-paying ad source, promotion of the paid version, and the selection of the premium price. The team was highly disciplined, and the results came very fast. The iteration and the religious way they were kept, gave the team a strong gut-feeling for the next steps. The result was very impressive, improving our play store rating from 4.4 to 4.5 and the paid version take rate has jumped by more than 10X!
After 6 months we were happy with our performance, but we have reached the top of what you can squeeze out of the topic of this app. What would be our next step?
We still had the same new user rate!
The question now was being top of the Google Play Store, the only leader is Google pre-install alarm clock that was part of the Android based package. Now we wanted to take that position from Google. That meant to get distribution through the manufactures of Android.
We have started looking for a phone maker to integrate our alarm clock app instead of the google default android solution, but we kept getting rejections as that was too small to create noticeable difference value for the phone manufacturers. It was just economy of scale where the alarm clock was not making any difference and they did not find it valuable enough. While the Google alarm clock just came out of the Android box.
While we were busy on the SW side, the electronic engineers have developed the hardware part that replaced the placement of the phone under the pillow. He created Koala, a code name for a little device with no interface at all no activation or led to interact with as a sleeping sensor. with 2-year battery life, for constant usage and a Bluetooth connectivity to the phone. That was our IoT story for the Alarm Clock Xtreme and the sleep quality measuring, with a soft wakeup at the right time.
Once the design and the casing of the sleep sensor came out, we have shown it to the device manufacturers (Sony, LG, TCL, etc.) they found it as a game-changer, willing to integrate the app as a default app on the handset. The hardware factor and the extra payment they could get for this alongside the market interest in sleep quality has helped to position their handset with a strong differentiator, one that they could understand and show. At those days’ year of 2015 the IoT was hyped and the manufactures looked for creative solutions.
The summary of this post, before you start innovating the broad detailed research is highly important, as well as discipline setting up targets and constantly measuring results and reviews. Innovation should contain a mix of incremental but also staggering innovative steps.
its amazing how the banalest product can transform into something advanced and creative.
