Integrated Solutions. Measurable Results.

360i Point of View on

Mobile Applications

July 2010

Overview

Applications have become an enduring form of mobile media, thanks inlarge part to the ease of buying apps from Apple’s App Store and theincreasing usage of apps on Google Android handsets. With apps’ popularitycome new challenges for marketers, as consumers’ attention is splitbetween apps and the mobile web. Marketers will have to prioritize andmake tough decisions when allocating finite resources.This is the fifth in a series of reports on mobile marketing, with more tocome. Read the others on360i’s Digital Connections blog, where you canalso subscribe to receive subsequent updates. The previous report onMobile Social Marketingcovers how marketers are using mobile socialapplications and complements the insights below, while a future edition willcover barcode scanners and other commerce-centric apps.

Mobile app usage trends

One of the biggest drivers of app usage is smartphone penetration. As noted inthe first POV inthis series, Nielsen reports that by Q3 2011, roughly half of US mobile subscribers will usesmartphones, and smartphone market share will only increase from there.Mobile ad network AdMob, which Google recently acquired,surveyed mobile usersin Februaryand found that Android and iPhone users spend about 80 minutes daily using apps, while iPodTouch users spend even more time. iPod Touch users spend more money, too - $11.39 per userthat purchases apps, compared to $8.36 for Android and $8.18 for iPhone. The App Store garnersabout twice as many paid app downloads per user compared to the Android Market.It’s not just smartphone owners who download apps, though. Nielsen reported that users of bothsmartphones and the simpler feature phones show similar preferences in terms of the apps theydownload, with games, music and social networking ranking among the top categories for both.

Integrated Solutions. Measurable Results.

360i Point of View on

Mobile Applications

July 2010

Smartphone users are more likely to download apps and on average have 22 apps installedcompared to feature phone users with 10. Nielsen also notes the variability within the averagenumber of apps per user of smartphone operating systems. iPhone leads with 37, followed byAndroid (22), Palm (14), Windows Mobile (13) and BlackBerry (10).Apple’s leadership here is uncontested. Over 5 billion apps have been downloaded across Applemobile devices as of June 2010, and over 225,000 apps are currently available.The second largest app market, GetJar, doesn’t belong to any operating system or handset makerin particular. This independent provider offers apps across various platforms and is only thesecond app store, after Apple, to record over 1 billion downloads. GetJar currently offersapproximately 75,000 apps across 2,200 supported devices.

Integrated Solutions. Measurable Results.

360i Point of View on

Mobile Applications

July 2010

How marketers can use mobile apps

Marketers have three primary options for reaching consumers through mobile applications:

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Advertise

: Ad networks such as AdMob, Quattro Wireless, Millennial Media, Medialets,Greystripe, Celtra and countless others can run ads within applications. It’s also possible torun custom promotions directly with many app publishers and developers. Major publisherssuch as top news and weather apps may offer app ads bundled into a broader cross-channel deal. Ad formats may include text, video, polls, lead generation forms, click-to-call, store locators and games.

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Integrate

: Marketers can work with select app publishers and developers to createcustom, integrated experiences that are far more involved than ad buys. Several suchexamples are included in theMobile Social Marketing report. Some apps even rejectstandard ad units and will only run custom promotions. These are of course harder todevelop and scale than running a mobile banner across thousands of apps, but the impactcan be considerable, as the marketer may find deeper ways to connect with its targetaudience.

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Build

: Building applications is an option for marketers, and the examples below show howapps have successfully been developed to fit in with a marketer’s overarching goals. Thereare several challenges though:

As shown above, most popular apps are for gaming and entertainment, which maybe a fit for certain entertainment and CPG brands but is often not in line with theobjectives for other marketers.

There needs to be enough budget available to build the app and promote it. Withouta strong commitment to promotion, the app may never gain enough visibility tobreak through the tens or hundreds of thousands of other apps. Marketers shouldconsider what channels they have available for promoting the app, from email to in-store to branded social profiles.

It requires an ongoing commitment. The best apps, branded or unbranded, gothrough constant iterations as they improve based on consumer input, internal ideasand changes in the technological capabilities of mobile operating systems andhandsets. Updates also encourage consumers who may have moved on to otherapps to return and give it another shot. This kind of commitment takes strongleadership and buy-in to muster the time and budget required to keep it going,especially if the app takes time to gain traction.