Localytics gets $5.5M to help devs turn analytics into revenue

Since launching in 2009, analytics provider Localytics has stressed the need for developers to focus on retention, loyalty and engagement. Now, the company is getting new funding to give developers and publishers the tools to pursue that with the ultimate goal of helping them generate more revenue.

The Cambridge, Mass.-based startup has raised $5.5 million Series B round led by new investor Polaris Venture Partners with participation from existing investors including New York Angels, LaunchPad Venture Group and others.  Combined with a $2.5 million Series A from last year and earlier seed funding, Localytics has raised more than $8.5 million to date.

The new money will help Localytics build out its existing analytics business, which is becoming popular not just with developers but enterprise customers. More than 10,000 apps currently use Localytics, which reaches more than 350 million devices.

localytics, analyticsBut the money will also go toward a new automated app marketing platform that will allow developers to re-engage their customers with messages that can prompt purchases or subscriptions. Unlike a push notification, which happens often outside of an app, Localytics’ messages will happen while the user is using the app and will be triggered by different actions. For example, a developer will be able to offer a user free shipping if they abandon a shopping cart or they can prompt a user to consider buying a subscription if they get to a certain point in the app. The system will be able to work in bad network conditions because it will preload some messages onto the client device.

Raj Aggarwal, co-founder and CEO of Localytics, who will be speaking at GigaOM’s Mobilize Conference Sept. 20-21, said developers have been getting better at building engagement and retention in their apps. But they still need tools to monetize their apps beyond simple advertising. By combining Localytics data with targeted messages, developers can send the right messages to people at specific times to encourage them to purchase something or take some action. They can use Localytics analytics to also see how successful the messages are and what the impact is on the lifetime value of a customer. Localytics can also adjust the messages on the fly to emphasize campaigns that are resonating with segments.

“Analytics is clearly important but ultimately, for many publishers, their concerns are about how to monetize,” Aggarwal said.

Localytics will offer free service for its marketing platform to customers for the next three months and then will pursue a per user-based pricing system similar to its analytics pricing.