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What Part of Free Didn't You Understand?

  |  February 24, 2011   |  Comments

There are two kinds of apps in this world: those that intend to make money, and those that intend to market.

All I hear about these days is apps. They're the newest digital currency, and if you've got a ton of them on your device, your cred goes way up in some circles. Of course, as with any new technology, only a fraction of the apps that are created are worthy of your time and attention - and hard-earned cash. We know this as consumers, so why is it that, as marketers, we forget all about it?

For my first ClickZ column, I want to take a step back and help marketers think about apps in a way that will take a brand forward. Tom Robbins wrote: "There are two kinds of people in this world: Those who believe there are two kinds of people in this world and those who are smart enough to know better." He was right, of course, but allow me to take the stand that there are only two kinds of apps.

  1. Apps that intend to make money
  2. Apps that intend to market

How do these differ? It's pretty simple. For apps that intend to make money, the app itself is the end product. It might be part of a line of products or come from a company that makes other products, but it is a discrete item all by itself.

The second type, apps that market, are trying to get a consumer to do something else. That "something else" might vary: establish brand love, watch a TV show, buy a car…you get the idea.

My company deals almost exclusively with the second type. Apps, when appropriate, are a part of our overall marketing mix for a client and can be an extraordinarily valuable tool. The problem occurs when marketers confuse the two types of apps.

Honestly, I'm not sure what happens - but I'm pretty sure it goes something like this: the internal team or the agency comes up with an app idea as part of a mobile strategy. Somebody decides that the app is so good that they shouldn't give it away; the world is going to beat a path to their door to buy it. This fine app will become the new hot thing on phones. Forget about defraying the costs to build it, we're going to make big money on this baby!

Remember, the company already has products on which it has built the organization, so let's not lose sight of the goal. As marketers, we're trying to create more loyal, long-term consumers of and advocates for a set of products. The way we do that is by showing that:

  • The brand understands you (making a product that appeals to the target audience)
  • The brand cares about you (making it easily available)
  • The brand is relevant in your life (providing you some value by having it)
  • This is a good guy brand

Nowhere in that list is "the brand can sell you its marketing" - and when you try to do that, the results are predictable. In my opinion, even the successes fail to improve the brand.

For example, Kraft, one brand that has been lauded in this area, has also gotten significant backlash for charging $0.99 for its app - which then runs ads for Kraft products once it's installed. It's a fine piece of software, and although the statistics will never be published, imagine how much revenue the app has generated as a percentage of product sales. Then think how much more broadly Kraft's app would be distributed if it were free (and multiply that by five for Weber's $4.99 "On the Grill" app).

On the other hand, I have to give ABC a lot of credit; since being the first to bring full TV episodes to the Web in 2006 (disclosure: I led the effort on the agency side), it hasn't stopped innovating, and its iPad app is a great example of providing customers with something truly valuable (and being willing to spend time and money doing it).

"Advertising" is sometimes viewed as a dirty word in our business, but it doesn't have to be that way. Apps can be the best form of advertising, driving rich interaction with a brand, putting it top of mind, and providing a valuable reminder of the core product. Remember, these are investments, and the more people who experience your brand, the better these investments work.

So: kudos to those who are getting it right - and please feel free to share your stories about making people pay for their advertising. All perspectives welcome!

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ABOUT THE AUTHOR

Andrew Solmssen

Andrew Solmssen serves as managing director of Possible's Los Angeles office, leading the firm's West Coast client teams and determining best practices for engagement management.

He previously served as managing director at digital firm Schematic, where he played a key role in developing some of the earliest advertising models for delivering broadcast content via the Internet. Andrew was also responsible for providing strategic guidance to clients such as Comcast, ABC Television, and NBC Universal in the areas of digital strategy, content distribution, mobile entertainment, and Internet TV. Before Schematic, Andrew served as executive producer at Web design and consulting firm Kaufman Patricof Enterprises.

A frequent speaker at industry events such as Digital Hollywood and CES, Andrew is also regularly quoted by business and trade media on the topics of digital advertising and technology innovation. Prior to his involvement in digital media, Andrew lived in Namibia as part of the Harvard Institute for International Development.

Follow Andrew on Twitter @asolmssen.

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