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October 09, 2011

Should you invest in a mobile app?

Ever-growing market share of smartphones has given birth to the pressing need to adapt to these changes and use customized approaches to reach your market.

If you are contemplating whether or not your business should invest in a mobile app, the following considerations should assist in helping you make the right decision.

Why do you want to invest in an app?

The standard answer would be to raise brand awareness.

When it comes to transforming your marketing activities with the assistance of digital media, answers can't be black or white. Strategic marketing requires that you assess every aspect of your marketing plan, including the most important aspect, the goal. This goal might be the same across various businesses but the methodology that works for one might not be as effective for another.

Known fact is that without engagement your brand will not be able to create the impact you desire. Mobile apps are known to raise brand awareness, only when they create engagement. Quite similar to establishing your brand on Facebook, building an app should not be just about raising brand awareness, it should be one of the elements that make up your final goal but should not be your sole goal. A further reality check explains that social media engagement doesn't require a user to download your app, invest time in studying the functionality and then actually use it! Moving forward, the likelihood that a user will continue using your app diminishes over time. Pinch Media's study shows that over the period of one month, the number of users who will continue using your app will drop down to mere 5%!

For certain brands, distribution of app is an extension of the services that are already in high demand. For example: Brands dealing with news/entertainment media or events. When followers are chasing after you (think Starbucks), talking about you without you having to create much of a stir, your app is bound to retain all that customer loyalty! In this scenario, the app evolves to become yet another medium for anytime-anywhere engagement and in the process provide the user with an even more customized service. On another hand, there are the others, not so popular businesses in whose case, simple distribution of an app to raise brand awareness has an extremely low probability of working out.

Even Free apps are known to go unnoticed. The Pinch Media study shows that within this highly competitive app market, it takes a lot to get listed in the Top 100 on the iTunes apps store. Last run estimation shows that on an average, a free app would require 5000 downloads within a 24 hour period, to make it into the Top 100 alone! Over the sampled period of 6 months, number of downloads required for free apps to enter the Top 25 list has increased from 10,000 to 20,000 downloads requirement. High competition has resulted in more entry barriers, there by disregarding the assumption that distribution of a free app will help you widen your reach.

Figuring this need for developing and distributing apps is not enough, strategizing and devising a plan to weigh your options and conclude whether or not you should invest in apps should be the primary concern.

I've created a list of questions, you could add more to these...

1. Do you have mobile presence?

If Yes, then is there something exciting you can offer with an app that you can't on your mobile website? Surely, there is the biggest consideration of connectivity, mobile websites require the use of internet, an app will be available anytime-anywhere despite internet connectivity issues. Secondly, what do your website analytics say? Do you have a comparatively larger volume of people viewing your website on their phones? Furthermore, what do the demographics say? If your demographic is made up of younger people, they are more likely to invest time in apps. Study of these demographics will give you a better idea on what people are looking to get from your app.

If your answer is No and you don't have a mobile optimized website, the first step to take before building an app is to develop a mobile friendly site. If you check your analytics, you will notice that the number of people visiting your website via mobile phones should have gone up already, owing to the rise in smartphone usage as explained on  (On a side-note, you can test your mobile website performance on This should give you an idea of how your website appears on different phones.)

2. If mobile presence is not enough and you are still contemplating investing in an app, figure out what kind of an app would you want?

There can be two kinds of apps, a free app for advertising or a paid app from which you could generate revenue. Majority of businesses offering apps are distributing them for free, the revenues generated from paid apps are usually quite low considering most apps are sold at a very minimal price of between $2-$4.

3. What will your app do?

An app should reflect something about the business. Having an app that does not resonate with your business policy can create a negative impact. focuses on some great App Store Stats for Aug, 2011 which shows that on average 20,000 apps are submitted each month. How easy is it for your app to disappear in this crowd?

Defining a purpose for your app is the critical step. Will your app make ordering/booking your product easy? Will it provide the user with hands on information like a product manual/faqs tool? Will your app provide guilt free entertainment, like a game? Your app could do so much and so little depending on the creative input.

This is a good read on how bad apps can hurt brand names.

4. What platform will you focus on?

Once again, based on your analytics overview you will get an idea of which platforms are mostly used to view your website. Is the number of iPhone users significantly higher than other platforms? Will concentrating on an iPhone app be enough? Most important platforms according to are iOS, Android and Blackberry but only within the US. These statics can differ as you study different geographical locations across the globe with Symbian being popular within Asian countries.

Moreover, designing for tablets is different than designing for mobile phones. Here is a good read on the key design differences by Josh Clark.

5. Cost and ROI?

How much is this app going to cost? Based on the quality of the app, this price can range anywhere from the DIY-$0 to $25,000 or even $100,000 for high end apps.

Back to ROI and valuing the reach, for per dollar invested, how many people will your app reach? Mashable has a brilliant report on how you can reach a larger number of people for your $1 via investment in mobile webb than mobile apps!

With the figures looking such a dismay, should one not invest in an app? The answer to this question is, yet again in the gray! How long will it be until your competitor transforms their marketing efforts with mobile apps? Having an advantage of being the first will surely help you hold your position firmly. Secondly, mobile app usage will provide you a further insight into your customer's behavior and help understand their relationship with your brand. Finally, don't forget your goal! Think engagement and further conversion.

On a positive note, Google Insights on the term 'apps' for the period of October 2009-October 2011, shows the growth graph focusing on the rise in search for the term. Clicking on the link will display the entire table. The top most related search terms are embedded below the graph.

Image Source:
Hilarious HTC Infographic about Mobile Apps of the Future