Why Apps Aren’t The Killer App For Mobile Marketing

It was more than 10 years ago that I listened to my first sermon about the growing importance of mobile as a marketing channel. It was late 2000 or early 2001; I was working at DoubleClick at the time, and my boss left the company to join a mobile startup, claiming we should’ve already had a mobile ad offering in place because it wouldn’t be long before smartphones replaced PCs entirely.

Suffice it to say I’m still waiting anxiously for a chance to throw away my computer -- and likewise, marketers are still waiting for mobile to become a genuinely important marketing channel. It’s not that they’re pessimistic: In fact, the marketers in our surveys rank mobile just a hair behind social media in terms of channels they think will grow in effectiveness over the coming years. But anticipation has never quite equaled reality -- and so most interactive marketers across the US and Europe continue to bide their time, waiting for a mobile marketing opportunity that’ll match the hype.

And that’s where mobile apps appear to come in. Few interactive marketing opportunities are more hyped than mobile apps, but in our search for a mobile marketing channel that really works we’ve lost sight of one crucial point: Marketers’ target audiences don’t care nearly as much about branded applications as the marketers themselves do. In fact:

  • Mobile apps remain a niche opportunity. According to our latest surveys, just 7% of mobile American and European phone owners regularly download mobile applications -- and only 11% of phone owners in the US have ever downloaded an app from an app store or marketplace. Meanwhile, data from mobile analytics firms shows that on average 80% of free apps are never used again after the day they’re first downloaded.
  • Mobile marketing apps rarely get traction. Sure, a handful of outstanding branded apps have found an audience. (Another former DoubleClick colleague, Ed Kaczmarek, helped create the Kraft iFood Assistant app that’s most commonly offered as an example.) But too many marketers tell us their apps were neither downloaded nor used by very many people -- and how many marketing apps do you see on the iTunes Top 10 lists?

So should marketers just ignore mobile altogether, then? No, but they have to be smart about how they leverage the channel. The POST process we recommend marketers follow to plan social media marketing programs (study the people you're trying to reach, set measurable business objectives, plan a marketing strategy, choose the technologies and platforms you'll use) works well for mobile marketing too.

One of the first things marketers will find when they follow the POST process is that most audiences would rather sign up for SMS updates or visit your mobile site than download your mobile app. A small number of marketers may find that apps really are the mobile technology most likely to reach their audiences -- just don't count on it.

For more thoughts on how the mobile marketing space is evolving and how marketers can use mobile effectively, I'd encourage Forrester clients to read our reports The State Of Mobile Marketing In Europe, 2011 and 2011 US Mobile Marketing Predictions.

Comments

Couldn't agree more. Nobody

Couldn't agree more. Nobody is going to download an app to take advantage of one company's coupons or special information. Apps have to at least work across broad interest sectors (eg, groceries, used-cars, building supplies) and even then it's a stretch to use a specific app. Well designed mobile web apps paired with generic tools like QR code scanners or NFC are much more attractive to end users because it gives them broad applicability and access to info. It doesn't lock them in to one company's parochial view of the world, even though companies would love to do that.

Follow-up

After developing some Android apps myself, I've gotten a little better perspective on the app vs. web-app discussion. I still think developing an app that does nothing but give you the same information you can put on a well-designed mobile page is not worth the effort. However, offering a unique value or capability that's hard to deliver in a pleasing manner on a web page is worth it. The difference in user experience between an app and a web page is striking. The ability to exploit and play nicely with the native UI framework, utilizing custom dialogs and gestures, and it particular on Android, the ability to leverage other apps already on the phone make a real difference.

My observation about an app for one company vs an app across companies in the same market still holds, tho. Consumers prefer apps that give them choice, not lock them into one company.

Thanks

Thanks for that update, Joe. It's a fair point: apps do give you better flexibility and functionality (and sometimes usability) than mobile web pages. But it's just the latest version of a long-standing dilemma: You can make something amazing using bleeding-edge technology, or you can make something that your audience can actually use.

I remember developing Flash ads a decade ago when marketers wanted to use the amazing functionality of the then-new Flash 6; the problem was only 10-15% of the population had Flash 6 installed at that point. The answer was easy: Develop first and foremost something that works for the majority of your audience (in that case, Flash 5, which had 50-60% penetration, or Flash 4, which had 80%+ penetration), and then if you have time and resources left you can build something better for the handful with the new technology. But most marketers realized there was little point in spending the majority of the time and resources on something only a few of their audience members could see or use.

The same has been true of HTML5 for the past couple years. Developers have been chomping at the bit to focus exclusively on making amazing stuff that works in this format -- but responsible marketers have realized they needed to focus on serving their entire audience first with older versions of HTML. (Happily, we seem to nearing a tipping point where HTML5 can start to take center stage.)

Again, I'm not saying apps can't work for marketing, or that you shouldn't do them. I'm saying we need to be realistic about how many of our customers can or want to use those apps - and make sure we've got the basics of mobile (ie a mobile web presence) right first.

Any mobile has to deliver a

Any mobile has to deliver a value proposition: Does it make my life easier? Does it help me to fulfill a task quicker? It's has to be a utility for the customer, not a channel for the marketer.

It's not about the numbers?...

Hi Nate,
Thanks for sharing this. One question this raises for me, at the same time, is whether or not there are certain branded apps that marketers may not even worry about reaching iTunes top 10 ; what I'm thinking of really is the difference between a large consumer brand that wants 10 million followers on Twitter, and a B2B brand that may want a select audience which they know is much smaller.
Also, would you say that this applies to enterprise apps in the same way?

Thanks :)

Michelle

Questionable Stats

It is still important to take into consideration the relative newness of mobile Apps. This week total mobile Apps available is poised to reach 1 million, that is quite a bit considering the mobile App phenomenon premiered in 2008. So, in a mere 3 years we have seen a huge explosion of Apps available. While you state, "only 11% of phone owners in the US have ever downloaded an app from an app store or marketplace," PEW's stats differ. PEW studies have found "the share of adult cell phone owners who have downloaded an app to their phone nearly doubled in the past two years – rising from 22% in September 2009 to 38% in August 2011." http://www.pewinternet.org/Reports/2011/Apps-update/Overview/Findings.aspx

You're free to shop for the highest number

And many people who are especially excited about any given technology trend are inclined to do just that. You'll also note that survey samples, questions and methodologies vary -- all of which can influence results. But the bottom line for me: our survey sample for this data is more than 4 times bigger than the survey you reference, and so I'm happy to rely upon our data on this matter.

And you're right; apps are a relatively new phenomenon. They'll grow in use as time goes on. But right now they're still niche - and until they emerge from the niche into the mainstream, I stand by my comments: They shouldn't be the first mobile marketing option to which companies turn.