Step back to 1995. Once in a while, a URL would pop-up at the end of a TV commercial. Unlike the ’90s, URL advertising isn’t as prominent anymore. Why? Consumers expect every brand to have a digital presence. It’s no longer a novelty; it’s mandatory. We are now in the 1995 phase of mobile apps. Some brands advertise their new flashy app just as they did their URL in 1995. Branded apps are not, however, mandatory… for now. The growing app tidal wave is an opportunity for brands to engage and entertain current and acquire new users. Just as websites are the cost of developing a business, apps will be soon be another mandatory marketing expense.
The same questions brands asked about websites in 1995 applies to apps: "why should I jump on the bandwagon?" If users downloaded 1 billion Apple apps in its first 9 months isn’t enough, consider 24 percent of US internet users downloaded a branded application. In one month, users downloaded 29.6 million apps across Apple and Android platforms alone — with a 12 app download average per iPod Touch user. OK, apps have exploded on the mobile scene, but what are the brand benefits? Branded applications can extend the brand experience, acquire customers, develop a mobile marketplace and generate app revenues:
Extend the brand experience — In November 2008, Kraft Foods extended recipes and tips from Kraft Kitchen to its iPhone app, iFood Assistant. The $0.99 app opens the door to 7,000 recipes, cooking tips, a shopping list builder and how-to videos commingled with ads for Kraft brands. Six months after users download the app, over 60 percent continued to use it.
Customer Acquisitions — Apps that fit a consumer need, such as food recipes or health improvement tools, grow organically. By capturing broader mobile user needs, a brand can go viral and acquire new audiences. In fact, 90 percent iFood Assistant users are new to the Kraft Foods environment.
Generate App Revenues — Livestrong developed an app for $2.99. Within three weeks after launch, the app hit #1 for health applications — with 3k downloads per day and 600k total. That’s nearly $1.8 million in revenues. To top it off, the app has an astounding 10 minutes per session.
Marketplace platform — Beyond app download revenues, brands can build marketplaces within apps. In fact, 37 percent of smartphone owners purchased merchandise via their phones in 2009. As users become more comfortable with their smart devices, expect mobile shopping to...