A new report from Deloitte has confirmed what many app developers know already: the majority of mobile apps commissioned by brands are failing to take smartphones by storm.
The report was based on analysis of apps published on iPhone, Android and BlackBerry by big healthcare and consumer brands. Deloitte says that less than 1% of these apps have been downloaded more than one million times, and that only 20% had been downloaded enough to be considered for its survey.
Or, to put that latter stat another way: 80% of branded apps analysed by Deloitte had been downloaded less than 1,000 times. This, despite the fact that every month, the three stores in the study generate 1.6bn downloads – 1bn for Apple's App Store, 500m for Google's Android Market and 90m for Research In Motion's BlackBerry App World.
"Brands view apps as a golden opportunity to communicate directly with consumers and in a more meaningful, long term manner," says Howard Davies, media partner at Deloitte. "When brands get it right, the returns can be huge." The problem appears to be that most are getting it wrong.
It is easy to forget that one of the first big hits on the App Store – fuelled by word of mouth – was a branded app: Carling's iPint, which racked up several million downloads in the first few months after Apple's store launched. There have been other brand-app success stories too, like the Barclaycard-branded Waterslide Extreme iPhone game, which had been downloaded more than 12.5 million times at the last count.
Some branded apps have been successful, then, so why are the majority flopping so badly? A few reasons suggest themselves:
First, the majority of these apps are low in quality, and/or are pure marketing. iPint's success as a novelty branded app turned out to be one of the exceptions, rather than the rule. Actually, the way forward for brands is more likely to release apps that have real functionality, solving a problem for users or providing features that are genuinely meaningful.
Pizza Express' iPhone app, which enables people to book tables and pay for their food, falls into that category. Tesco Groceries is another: in fact, most of the large retailers' apps have majored on functionality rather than pure brand messages. Lynx Stream, meanwhile, was an ambitious attempt to wrap social location features – sharing photos of nights out – around a deodorant brand.
The second reason many branded apps have struggled, though, is that they have been eclipsed by apps and games that have come from nowhere to become brands in their own right.
To name three specific examples: Rovio Mobile's Angry Birds is now well past the 200m downloads mark on all platforms, and when the company launched a spin-off game for blockbuster animated movie Rio, it was clear that the former was the lead brand, rather than the latter.
Mobile gaming firm Storm8 has passed 210m downloads for its free iPhone and Android games, while Outfit7 just passed the 150m mark for its talking character apps for iPhone and Android. In an ecosystem where three new (or in Rovio's case, unknown outside the Java game industry) developers can total 560m downloads in three years, the news that most branded apps are struggling is not a surprise.
But the third reason is more of a shock: branded apps simply are not being promoted very well. Whisper it, but it is not actually that hard to pass one million downloads even on one platform, if you have money behind you.
Strategic use of promotional services like Free App a Day, along with some intelligently-targeted advertising within other apps or mobile websites, mean the seven-figure milestone is far from insurmountable even for an average app. The fact that few branded apps are promoted in this way suggests a belief that the brand itself is sufficient to cut through the app store clutter.
It is not. Deloitte's report suggests that the answer is to make more use of smartphone hardware, including the accelerometer, touchscreen, camera and GPS. That will help – albeit with caveats in the latter case as smartphone owners get more savvy about sharing their location – but brands must ask themselves two basic questions too. What is their app for, and how do they plan to promote it?
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