We are live on the ground in San Francisco this week for Macworld 2011, and one of our first meetings was with Navigon, which has reinvented itself in the US over the past few years, going from a company that makes personal navigation devices to strictly a software company thanks to the MobileNavigator iOS app and its variants. The overall smartphone nav app market has grown by 117 percent in the last few years, and largely due to the iPhone app (which reached 1 million downloads last August, a number made much more impressive when you realize the app usually sells for US$50 and up), that's pushed Navigon's own growth hugely as well.
In the past year, the company released version 1.7 of the software, which added improvements in the form of a paid in-app Zagat rating tie-in as well as free updates, like Google Local information. The last update also added across-the-board compatibility with the iPad, and Navigon told me that many of its iPad users were not using Apple's tablet in the car itself, but at home to plan out and see in motion the routes they later transferred over to their mobile devices.
The company hasn't released any hardware in the US for a few years (though "our main business is still hardware" in Europe, they said), but that will change with the Design Car Kit, an iPhone 4 holding stand that attaches via suction cup to your car's window -- it's designed to hold your iPhone while it runs MobileNavigator (or any other app, really -- there is a charging cable included that's "extra long" for easy access, but there are no electronics in the kit itself). Navigon told me that they thought there was a place for a quality holder on the market, and the device certainly seems well-designed, with the suction cup attaching via a release that won't let go easily when locked down.
The cradle for the iPhone also detaches from the kit base itself, which Navigon says will be useful when the next version of the iPhone is released -- you'll only have to replace the cradle, not the main base. Otherwise, the kit seems very simple. It was designed for a low price, but it's sturdy and versatile enough to securely hold your iPhone as you drive along. One caveat: the cradle fits pretty closely around the iPhone 4, so most cases will probably have to be removed before the phone is snapped in.
Other than the car kit, Navigon is also planning more updates for the app, of course -- road coverage is due for a big update, bringing in over 87,000 more miles of roads, increasing the various maps by over 76 percent in terms of coverage. The Traffic Live functionality is also getting updated soon -- that's a separate in-app purchase service that provides live updates on local traffic, and it's getting a free update for folks who've bought the in-app purchase to improve inner city traffic reporting.
Finally, Navigon's Vice President of Mobile Phone Business and New Markets, Gerhard Mayr, chatted with me a bit about the numbers behind the app. Despite the relatively high price, Navigon has seen a lot of success on the iPhone, and Mayr attributes that to the quality of the app and the perception of that quality. The company did put the app on sale a while back, and "over those four days," Mayr said, "our sales were tremendous." But while a lower price point would probably sell more apps, the higher price point actually helps the app's perception, said Mayr. "It's not a cheap app," and that means that users willing to pay the premium will find their money's worth in the download.
In-app purchases are another area where Navigon has seen a lot of success. Traffic Live is seeing a buy rate of 25-30 percent among the app's customers, according to Mayr -- the purchase rate was higher when it first debuted, but it has since settled down to that (still relatively high) level. The Zagat rating package isn't doing quite as well -- Navigon is only seeing about 10 percent buy-through, but they're still satisfied with that since it's not as necessary in terms of functionality (not to mention that there are other apps with the same kind of information, including the free Google ratings already included in the Navigon app).
And finally, we talked about Navigon's approach to Android and other mobile app platforms. The company has already released apps on Android, Windows Mobile and Windows Phone 7 around the world, and is planning to support any other mobile platforms that crop up as well. While the split on iPhone and Android used to be 80/20, Mayr said, "this changed." While the iPhone is still leading the charge in smartphones, "we as a business decided we have to keep on Android." He also called the platform "an interesting animal" -- Navigon saw a huge rise in app sales during the end of last year when a lot of new Android devices hit the market, and though their communications with Google aren't as easy as picking up the phone and talking to Apple, Navigon is on Android for the long run.