Businesses struggle in marketing of apps

CONSUMER APPETITE for smartphones and apps is a source of frustration for organisations and brands which struggle to turn it into an effective marketing tool, according to a new Deloitte report.

Analysis from the consultancy firm shows that attempts to ride the apps bandwagon – where 45 per cent of smartphone owners download an app at least once a week – have been largely unsuccessful.

Fewer than 1 per cent of apps published by global consumer and healthcare brands were downloaded more than a million times.

“Having a low percentage of downloads is worse than having nothing at all,” says Harry Goddard, a partner at Deloitte.

“Organisations are threatened by not being able to fill a need that customers are identifying, a need that could be potentially filled by a third party. They are working hard to find a way to respond effectively.”

Goddard compares it to the early days of the internet when static corporate websites failed to hit the mark and it took interactive content to get things moving.

To succeed in the mobile market, Deloitte is telling organisations to enrich their apps with functionality that makes use of smartphone features such as portability, touchscreens, location-based services and on-board cameras.

While traditional advertising is not going to work, Goddard believes there are already examples of personalised services that successfully target smartphone users. In Canada, a DIY chain has an app that offers short-term promotional discounts to consumers who are near a store.

“If you use the technology to tell you where the person is and wrap a useful service around that information, it will have a much better impact,” Goddard says.

Another challenge in turning apps into a commercial opportunity is that different apps stores serve different mobile operating systems, making it hard to scale meaningful media campaigns.

Developing an app that works with Apple, Android and Nokia is not cost-effective, Deloitte says, calculating that the cost of developing the same application for two platforms is 160 per cent of the cost of developing for one.

“At the moment, you have to target the apps based on the demographics associated with an operating system,” Goddard adds.

“Particular consumer segments are attracted to particular consumer devices. It’s definitely an issue and there will have to be some convergence.”

The evolution of the apps market may be uncertain but the Deloitte research highlights how it isn’t going to go away.

“The app market has some way to go before it rivals TV or the web for penetration, but it is of growing importance for brands,” Goddard says.

“Brands view apps as a golden opportunity to communicate directly with consumers and in a more meaningful, long-term manner. When brands get it right, the returns can be huge.”