Wednesday, 30 May 2012

Do tech companies (and people) misunderstand advertising?

Firstly, let me apologise for writing yet another post that mentions Facebook; I promise, this will not become a Facebook-focused blog. In my defence though, there's an awful lot happening with it as a business and much of it is incredibly interesting for new age marketers - ie. app developers. So on that note...

There's been a lot of ink (both real and virtual) expended in recent weeks analysing the current and future performance of Facebook, and putting aside its rollercoaster IPO, much of that ink has been devoted to the performance of Facebook in the advertising realm. A quick whip around the news sees stories about: declining revenues; inability to get mobile right; the loss of GM's business just prior to the IPO; and of course comparisons with business like Google who did get their advertising model right prior to IPO. Most, if not all the analysis warns that Facebook hasn't got their advertising model right and that with its weakness in mobile it's falling further behind. Firstly, this is fairly obvious, but as the actions of GM show, some marketers, some commentators, and perhaps even Facebook itself, seem to have a misunderstanding about how advertisers can make best use of Facebook's facilities - the key here is considering how users interact with Facebook.

Let's first start with those who get it right - Google and Amazon. Have a think about what is going through your head when you're using these sites; most likely you're in acquisition mode, whether for information, products or services. If it's either of the latter, advertising that promotes a specific product at a specific point in time will be helpful to you. Chances are that you'll be more receptive to the message and you might even click through and purchase. Contrast this with Facebook which is more "recreational"; in this mode you're relaxing, you're spending virtual time with your friends, connecting, playing games, etc. Any advertising that prompts you to buy there and then is either ignored or worse, is an irritant - imagine someone tapping you on the shoulder trying to sell you something whilst you're catching up with friends... not the best approach. As an advertiser your best approach in this circumstance is to brand build, allowing customers to gain a greater insight about your company and what it stands for without trying to sell something on the spot. In time they will hopefully develop a preference for your brand and products and then, next time they're using Google or Amazon they'll click and buy.

Does this then mean that Facebook is the wrong place to advertise? Not at all. What matters is what you (as an advertiser) are hoping to achieve and therefore how you advertise in that environment. GM don't seem to have figured this out - and if Facebook tried to convince GM that they operated like Google, they were probably kidding themselves as well. Fortunately for Facebook, Ford and Chrysler have figured this out and have stuck around.

So what do we take out of this? For Facebook, a couple of pieces of free advice. Firstly, Facebook should stop telling anyone (clients, users, the markets,anyone) that its advertising model is anything similar to that of Google and Amazon, clearly it isn't. With its scale, Facebook has the opportunity to be the most powerful generator of insights into the human condition this side of god. So find a way to commercialise that! Secondly, Facebook's corporate Clients currently get an incredible amount of free branding and consumer engagement via their corporate Facebook pages - actually selling that service (provided the pricing is right) would net Facebook a very handy revenue source.

For app developers, the lessons are useful - if you are developing an app that includes in-app advertising, think very carefully about how people will use your apps, when advertising will be most suitable and what sort of advertising will work most effectively. If you intend to advertise your app to potential customers using a service like Vungle, think about what your customers will be doing when they see your advertisement. What will be the most compelling way to communicate with them without annoying them? Get this right and you'll not only build your brand but you'll increase sales in the longer term.

Thursday, 10 May 2012

Facebook launches its app store

It's definitely a fascinating development.

For app developers the opportunity to be hosted on a market designed to put the universe of apps out to 1/6 of the world's population is simultaneously exhilarating and terrifying. Get it right and you stand to own the world, get it wrong and you'll be buried by everyone else with the same thought - a needle in a haystack-sized pile of needles.

Whilst customer ratings will help consumers navigate this new universe, they create a tyranny for new apps. How to be recognised, how to make you app standout before the stars start landing?

The most important thing to bear in mind is the power of this new environment, there's no need to capture all 900m users (though good luck if you can). With such a massive market, even a niche market will still contain millions of people. Think about who would most likely use your app, by rigorously specialising and simplifying your product, your customers will more easily be able to identify themselves - specialising your product becomes powerful when you can hook into a network of like-minded Facebook users. 

Wednesday, 9 May 2012

"Yes you do need to market your apps!" A Marketer's Manifesto for the App Business

As you may have guessed this blog covers marketing for apps. The title is derived from the first common mistake of app developers - expecting your app to "go viral" is not a marketing strategy. If your app does go viral and you make a billion dollars then good luck to you, you probably don't need to read this blog. That is unless you're a potential investor in other apps, in which case you do need to read this blog because marketing apps is going to become the biggest single challenge for app developers in the future. So just to be safe, everyone with any involvement in apps should read this blog.

Firstly let's establish something - you do need to market you apps. I'm sorry to say it but with the hundreds of thousands of apps (and growing) cluttering up the various app markets, the chances of someone stumbling across your app, and then being so enraptured that they want to tell everyone they know (and being influential enough for them to listen) is pretty remote. Angry Birds was a bit of a one off... and even then it took Rovio 6 years to become an overnight success.

Looking at this another way, let's imagine you've just invented a new shampoo. You think it's the greatest shampoo ever. Your chemists are modern day alchemists and your testing reveals that it's secret ingredients and excellent packaging design mean that it will make you a fortune. So you put it on the shelf in a big supermarket along side the big brands. And you wait, but your shampoo doesn't sell... people keep buying the big brands despite the fact they're more expensive and not as good as your work of perfumed, silk-hair-producing genius. Why? As we as consumers know, people buy things they know about from companies they've heard of. And more than that, we forget things easily, so we are repeatedly reminded about those things by those companies. As you can guess it's pretty tough selling pretty much any kind of consumer product in the physical world.

It works the same way in the market for apps... but unlike a supermarket where there's maybe a couple of dozen similar products, in the apps markets there may be thousands, maybe tens of thousands. And considering that it's relatively easy to make those apps (there seems to be an endless stream of 14 year old millionaire app developers out there), there's a constant stream of new apps out to swamp your app. So how do you stand out? And how do you retain the awareness of the app-consuming public. That's where the app world can learn something from the physical world.... ie. Marketing.

But here's the problem... it's devilishly hard to market well on a low (or no) budget - unlike normal consumer products the app world is more challenging and marketing is very much in its infancy. Those same developments that made it possible for you to make an app in your bedroom in your own time, made it possible for everyone to do the same, and if you're making apps in your bedroom, chances are you don't have a lot of money to spend on marketing. So what can you do? Note: Doing nothing and waiting for people to find your app is not an answer.

If you're reading this looking for all the answers I'm sorry to disappoint you... I don't pretend to have all the answers... it's just as new to me as anyone else. But I have a lot of experience of marketing under my belt and figure I can spot a good idea when I see one. So along with dispensing some general marketing advice that applies to shampoo and apps, I'll also keep a lookout for new ideas and start-ups who are developing ways to make marketing apps easier and cheaper. The aim of this blog is to become a storehouse of information, discussion and debate about how ordinary app developers can get their apps seen and sold. With luck over time we can put together some best practices amongst successful companies who built success on something more than blind luck... practices that can be shared with anyone who is interested. I have no idea how far this will go, but I get the feeling this could be in an interesting journey.