It’s an App, App World: Are You Ready to Add Mobile Apps to Your Plan? (Fast Company)

FC Expert Blog

It’s an App, App, App World: Are You Ready to Add Mobile Apps to Your Plan?

BY FC EXPERT BLOGGER STEVE KERHOThu Oct 28, 2010

This blog is written by a member of our expert blogging community and expresses that expert’s views alone.

App StoreLooking back on 2010, the only thing to grow faster than the development and download of mobile applications is unfortunately our federal deficit. Most marketers believe that the last thing they need is another media channel to consume their already limited resources. But native apps, especially those for tablets like the iPad, create a very rich opportunity for marketers to engage with consumers.

Let’s be honest, creating emotionally engaging advertising content within the world of the browser is a challenge. Engineers, not marketers, designed today’s Web browsers. One of the foremost marketers and designers of our time, however, drove the creation of the iPad. This could be the long awaited mash-up of the best of the Web and TV–seamlessly blending interactivity with a beautifully rich, video friendly format.

The Numbers Speak For Themselves
Apple’s App Store opened in July ’08 with a little over 1,000 apps. Let’s look at it today, a little over two years later:

* More than 250,000 iPhone apps; about 35,000 iPad apps at iTunes (Source: Apple)
* Over 600 new apps added daily (Source: Apple)
* Approximately 70% of apps are paid for by consumers– yes that’s right, consumers are actually paying for digital content in this format (Source: Royal Pingdom)
* More than 2 million iPads were sold in just two months. In Apple’s most recent financial quarter, their best ever based on total revenue, they sold over 4 million iPads. This added $2.7B in incremental revenue or about 13% of Apple’s total revenue (Source: Adweek’s Digital Hot List)
* The market for tablet apps is expected be over $8 billion within five years (Source: GigaOm)
* Early adopters spend more than 18 hours a week on their iPad (Source: NPD)

And if these numbers weren’t impressive enough, they don’t include apps created for other popular mobile platforms like Android, Symbian or Blackberry, or the fact that the market is about to be flooded with new tablet offerings.

Can You Afford Not To Have Experience Marketing with Apps?
I believe that few marketers can afford to NOT have experience in this growing channel. The combination of the incredible growth of apps with the ability to deliver an emotionally rich interactive experience is a new venue of unparalleled opportunity. Marketers who master this environment early will have a first mover advantage over their competitors and will likely own more of their consumers’ time in this space.

This is not to say this channel will replace any of our other key media channels. Just as radio didn’t kill print, TV didn’t kill radio, and the Web didn’t kill TV, apps are not going to kill any other media channel. Apps will, however, likely cannibalize some time from all these channels. Waiting to see “how big” the app trend gets before getting experience with it could be a dangerous mistake.

New media devices are reaching a critical consumer mass in increasingly shorter time frames. And because creating meaningful and high performing app content is no easy task, postponing this experience could mean giving your competitors an open invitation to engage with your customers in a space that you aren’t in. As with any new medium, there will be a period of exploration, or trial and error, and many marketers have already started to gain valuable experience with apps. It is much better to learn these lessons when we have less than 10 million iPads in consumers’ hands than when we have 30 or 40 million.

Additionally, consumers are spending more of their digital time inside “walled gardens.” While this is largely being driven by social media, mobile and tablet apps will only add to this. Marketing in a digital walled garden presents several unique challenges for marketers–not the least of which is measurability. This is yet again another reason to obtain some direct experience with this channel.

Some marketers have already embraced this new medium and created some outstanding advertising-friendly apps–whether they are branded applications that are marketing vehicles in and of themselves (such as the new apps from The Gap and Victoria’s Secret) or apps that use display advertising as a monetization strategy.

A few of the favorites within our agency, Organic, are:

Content Sponsorship
Cadillac and Coolhunting
The app uses the Cadillac brand to introduce great content to people in an integrated, non-disruptive manner.

Brands Creating Content
Tabio
This offers a playful and engaging way to look at socks–yes, that’s right, socks. The fact that a cool and engaging app can made for a product like socks speaks volumes about the potential of this medium.

Content to Purchase
Net-A-Porter
Net-A-Porter provides great content and an outstanding selling experience with its dual-view, magazine-style app that flips vertically to bring consumers into the shopping experience.

Content with Utility
Kraft–Big Fork Little Fork
The app puts Kraft and Epicurious right in the heart of cooking and the family. Big Fork Little Fork is a resource for parents to use in teaching their kids about smart eating habits and have some fun while doing it. The new app is easy to use, has great pictures and contains lots of nutritional information and healthy recipes.

Gibson Guitars
Gibson offers a free app that functions as a metronome or a guitar tuner. Though the company could be viewed as building tools that cannibalize its real-life products, it actually enhances the consumer experience. This could go a long way towards developing lasting brand loyalty with their consumers.

Considerations When Creating Tablet Apps
Creating a consumer centric, high performing advertising-friendly app is no small undertaking. It requires an updated and evolved skill set in several areas, including:

Usability or User Experience Design: an entire new world of “gesture” based navigation is being developed for these devices. Gestures are essentially a by-product of touch-based navigation. The move to touch-based is the real paradigm shift in UX design. For example, text as a navigation element is no longer valid because people’s fingers are too big.

Moreover, usability norms are still evolving, but this is a world that is markedly different from the browser or game controller. A lack of understanding and sensitivity within this evolving landscape could be costly. It is analogous to the early days of Web design when creating a poor global navigation scheme would guarantee a site’s demise and corresponding consumer scorn.

Analytics: to date, most app developers have been focused on two metrics–the number of downloads and revenue from iTunes. While this might work for developers, marketers have far more complex needs. There are several opportunities for measurement within an app that don’t include any personally identifiable information, a very hot topic with marketers these days. A short list of metrics should include time and frequency spent with the app, type of content consumed, tool usage, pathing within content and navigation elements, etc. For app usage that occurs offline, the app can retain these measures and upload them the next time the user has Web access.

The ability to obtain these metrics is driven by the app developers. The developers must include the code for these measures while they are building the app and let’s not forgot that Apple strictly dictates and controls the development code for apps. Hence, these requirements should be scoped from the very beginning of the process. Currently, most agencies need to outsource this specialized development, and so there is a risk that the appropriate due diligence for measurement is not done and “retro” fitting these functions later is both time consuming and quite costly. This is different from current website development where page tags can easily be added to a site after it is built. However, developers can specifically configure the Google Analytics package (for native mobile applications) for each application and users will need to download the update. There are no current stats on percentage/frequency of users performing updates.

Another reality of marketing within walled gardens is that while you can evaluate what is going on within your app, you will not have any visibility into how your competitors’ apps are performing. We have gotten use to and taken for granted the kind of competitive data that can be provided by Comscore, Compete or any of the number of custom toolbar providers.

Measurements that tie specific app behavior with behavior in other digital channels and ecosystems are going to be a challenge. For example, looking at how consumer behavior within an app corresponds to or drives behavior with your brand website or social media properties isn’t currently possible. Apps are clearly an opportunity for a well thought out engagement score that combines both behavioral and survey data. ROI models will have to evolve to fairly and accurately establish the return a marker has received from their app investment. I plan to dedicate a future post entirely to measurement approaches within the walled garden of apps.

Technology: Native application development generally forces developers to code for a platform’s programming language. In today’s mobile and tablet app landscape, there is very little compatibility between the major players. Therefore, in order to create apps that work across multiple platforms, developers need to build separate apps to support each platform. Developers must choose which to build for first and they must understand the nuances associated with development on each platform.

There are several third-party “write once run everywhere” platforms that are gaining popularity, but they have run afoul of Apple’s App Store guidelines and may ultimately wind up limiting developers’ access to new platform features as they are made available.

Creating Awareness For Your App
We all know, that just because you build it, it doesn’t mean “they will come.” There are several great places where people discover apps, including the following:

* OEM App Stores–such as iTunes
* Third Party App Stores
* App Discovery Apps
* Technology Press–such as Wired, TechCrunch, et al
* WOM–leveraging Twitter and Facebook as discovery channels
* In App Advertising
* Mobile Search

Listed below are some recent statistics that attest to how most people discover new apps (Source: ClickZ.com based on a study done by W3i and Ron Weber):

Apple Mobile Device Owners:
*56% prefer to search the App Store from their mobile device for the app
*17% prefer to use the iTunes desktop software
*13% prefer to have the download link sent via email
*7% prefer taking a picture of an app’s designated barcode, receiving a link via SMS
*7% prefer receiving an alert via a mobile app

BlackBerry Owners:
*42% prefer to search the App World from the mobile device for the app
*40% prefer to have the download link sent via email

Android Owners:
*72% prefer to search the Market from their mobile device for the app
*11% prefer to have the download link sent via email

And Finally – Content is King
Apps will put marketers and their agencies squarely in the world of content creation. This is not about creating an advertising campaign; it is about creating an immersive consumer experience–and let’s be clear, the two are very different. The most engaging of today’s advertising-friendly apps all have one thing in common–they are about the consumer and their experience first and foremost.

If the app is not branded, then marketing content is respectfully and thoughtfully woven into the experience. The Cadillac CoolHunting app is a good example of this.

Let’s remember this is digital content that consumers are used to paying for, so the bar is set quite high. As anyone who has tried knows, creating engaging content is very difficult, just ask a major network TV executive.

Moving Forward
If your 2011 marketing plans don’t include any apps, I would strongly suggest that you ask your marketing department and agency why not. At the very least, you should be reviewing or considering proposals.

You don’t want to be left out of this new marketing channel. And because creating successful content in this channel is a significant challenge, you will want experience with it sooner rather than later. There is a real opportunity here for brands to create their own marketing platforms that represent what they stand for and deliver on it with a new combination of both interactivity and a full emotional pallet.

Steve Kerho is the SVP, Analytics, Marketing Optimization at Organic (www.organic.com).

 

About knev

Absolutely out of my mind.
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