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What is ROI for a Mobile App?

I was on a panel on monetizing mobile  at CTIA last week and somebody asked the following question:

"How do I justify the ROI on my mobile spend?"

This is actually something we've come across quite a few times now.  Mobile application spends are currently much lower than they need to be.  At the same panel Christian Lindholm of Fjord complained that companies were routinely trying to get apps built on a shoestring when a comparable design project should have a budget of at least $250,000.  The reason for the difference was put starkly by the CEO of Newser last year when he remarked that they hadn't see the return that justified building a mobile app in the first place.

My response at the panel, and my response now, is that this is exactly the wrong way to be looking at mobile, and this is exactly the wrong time to be trying to work out these numbers.

My first point is simple: mobile apps are here, but they're new.  Asking what your ROI on your mobile app is going to be is rather like asking what the ROI would be on your website in 1998/99 - the fact it you don't know.  But if you don't have something, you've a hole in your marketing strategy.

My second point is more complex and really at the heart of this issue.  People aren't sure what mobile can be yet, but we are getting a really good idea about what it shouldn't be.

Mobile apps are not mobile web sites, and they're certainly not web sites circa 1999 when it was, even then, barely, acceptable to stick some brochure-ware up and call it a site.  In our brand app survey which we're working on at the moment, we're seeing some of the largest brands in the world, ones who have stunning TV, Print and Web campaigns building the most embarrassing apps possible.

The mobile device is unique in how personal it is as a means of accessing data and information.  The web browser, described the other day by Sencha's Developer Guru, James Pearce, as our generation's "Box Radio", is an impersonal "window" onto information.  For most people their phone, especially their Smartphone is an extension of their personality - they have the things they want right where they want them.  They also have access to their friends, their social networks, location information and a host of other things too. 

Consider watching TV.  While the rise of the DVR is impacting how we watch TV, the nature of Twitter is going to save scheduled TV for years to come.  Twitter is the water cooler of the modern age, except you don't have to wait until the next day to discuss what Flynn did on Glee, when you're already following the stream, interacting with  new friends and following new people on the #glee twitter feed. 

The marketing possibilities for the TV companies then become enormous.  That feed and that conversation should be part of your app experience; eyeballs on that feed, should be a part of your app, and the traffic from that app should be fed directly back to you either to come up with new ways to watch - i.e. delivering the best and most interesting of the feeds onto the show in real time, or by creating a social feed later for fans to watch again and follow the conversation they may have missed.

The ROI isn't about the app itself, it's about the opportunity cost of having those eyeballs and fans interacting with your show, brand, organization OUTSIDE of the app experience itself.

Anything else is a wasted opportunity.

Mobile, Retail and Brand Presence

We had a meeting with a potential customer today where the topic was a retail application.

We certainly see that there are great retail uses for Viafo's technology in that sector but a lot of interesting questions came up as part of the discussion.

The core of the discussion was what are the uses for mobile apps for retail brands?

It was particularly interesting to have the discussion with somebody who has been given responsibility for mobile, but fully admitted to never having downloaded an application, not used Twitter, never heard of Foursquare and only occasionally had a look at Facebook.

When you're in the heart of the mobile and web business you tend to get an extremely blinkered view of the technologies in play.  We see this more often in discussions with customers about the iPhone - I'll blog on that another time.

So the interesting thing to come out of this discussion is what do you offer to somebody who at a fundamental level is having to design a service for people unlike themselves?

Now, I don't see this as too much of a challenge, even accepting that the concept of brand mobilization is quite new, there are several pretty universal marketing issues you should be addressing without even dealing with the thorny issue of whether or not you want your mobile app to be used for purchase.

Tackling that for a moment: do you want people to be able to buy with your mobile app?  I'd suggest it depends on your business - the data is sparse at the moment but I'm guessing we'll see a split around impulse and small purchases (movie tickets, drinks, vouchers) versus large items (clothing, cars, electronics) - that might be my age showing but I can't see myself spending any real time on the phone buying some shoes - to be fair, I don't do all that much on the PC either.

Anyway, that's also another entire post.

Where I really see mobile and retail coming into their own is in driving traffic and mind-share - not just to your bricks and mortar store but to the web side too.

So, what does that mean in practice?

Firstly, integrated Social Networking - and this isn’t just about having Twitter or Facebook or Foursquare hooks into your mobile app, but also having those cross-linked into your web and general social networking strategy.  If you're a retailer this means having a global AND local strategy - who Tweets for your brand?  Do you stores have individual or managed online identities?  How do you control your brand in there?  It's a powerful thing to have "From the XXX App" on Twitter, less so if it's somebody mouthing off.

Secondly, manage your Social Networking - true story - I recently had an issue with Qwest over our Internet Connection.  The helpdesk had been a time wasting joke.  I tweeted about my experience and had an @message from a Qwest Rep who fixed the problem - THAT is brand management.  If you want help with that, we can hook you up.

Thirdly, location, location, location - manage and make use of search - build location services into apps.  Drive physical traffic.  Make use of Foursquare - I don't myself but millions do and if you're offering freebies to the Mayor of somewhere, it's worthwhile being ready for that.

Fourth: Brochureware - see how far this is down the list?  It's actually not the thing that makes things sticky - it's a by product of doing the rest of the app right.  Make sure that these are cross-linked back to your website and to your prospects web accounts.  Let them share information.  They find a Widget they like online at work - make sure they can have that image on their phone when they use the app to find the store.

That way they can use their Foursquare "Mayor" discount and Tweet about how you rock.

Obviously, I'm blowing our horn, because this is the area that we designed Viafo to operate in.  However, regardless of who or how you do it, an integrated mobile, web, store strategy is a must for retail and brands - regardless of who you get to do the work.