When tech site Softonic was at its peak roughly three years ago, it attracted 120 million global uniques searching for downloadable computer software.
But when mobile app stores took over the role of software search and review, Softonic and its peers got into the toolbar downloading business, accepting huge bounties from toolbar creators to push software that often injected ads into a user’s experience.
When Google clamped down on the practice, the money from toolbar operators evaporated. And for good measure, Softonic was banned from using Google AdSense or Ad Exchange in 2014.
“Companies that didn’t have a diversified revenue plan were immediately impacted,” said Softonic CEO Scott Arpajian, who oversaw CNET’s download.com when it launched in 1996. He joined Barcelona-based Softonic in February 2015 with a mandate to turn around the site, which was operating in the red.
In seven months, he returned the company to operating profit by improving advertising yield and taking advantage of restructuring that left Softonic with a leaner organization. Shortly after, in November, Google unblocked Softonic’s account. The site anticipates 40% revenue growth in 2016.
A primary goal – learned out of the toolbar boom and crash – was to diversify Softonic’s revenue.
Softonic still had a strong asset, a site that attracts 100 million unique visitors a month. But it knew destination websites are on the decline and needed another way to be useful to consumers that leveraged its knowledge of software.
Because it saw what people searched for and downloaded, Softonic had plenty of data about what apps users wanted. More importantly, in a “brutally expensive app install market,” Arpajian said, with cost per installs often north of $6, it could use its own distribution channel to promote the apps at no cost.
So it decided to go into the app development business.
It initially assigned a team of four people “to prove the concept,” Arpajian said. The team has tripled in size since then, and Arpajian anticipates having 20 employees dedicated to the apps by the end of the year.
So far, Softonic has released three Android utility apps: Turbo Booster, which optimizes memory on stuffed devices, came out a year ago. A few months ago, it followed with antivirus tool Security Warrior and Screen Lock Guardian, which snaps a photo when someone tries and fails to unlock your phone. The apps use a combination of advertising, subscriptions and in-app purchases to earn money.
That said, Softonic’s audience still accesses the site primarily on desktop, which accounts for 65% of its traffic. Softonic hopes to change that metric so it won’t get cut out of the thriving app market.
It acquired AppCrawlr, which suggests apps a user might like based on ones already downloaded on a device, in March 2015. It plans to add sponsored native placements to the suggestions AppCrawlr makes for users.
By this year, Softonic expects the app business to account for 20% of total revenue. Most of the company’s current revenue growth is driven by the apps, Arpajian said, a step toward the diversification he wanted as the company moves from being a destination website to a model with multiple points of contact with users.
