POINT OF viewWhat Makes a SuccessfuliPhone App?By Rob Gonda, director of digital strategy, Sapient Nitro.As we begin 2010,...
POINT OF viewObjective: Drive RevenueRevenue can be driven directly by the application, or indirectly by multi-channel int...
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What Makes a Successful iPhone App?

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quick point of view on iphone app ROI strategy.

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What Makes a Successful iPhone App?

  1. 1. POINT OF viewWhat Makes a SuccessfuliPhone App?By Rob Gonda, director of digital strategy, Sapient Nitro.As we begin 2010, there are more than 100,000 iPhone apps available for download — a dizzying arrayof choices, with hundreds added each day. There are plenty of gems out there that have truly changedthe way we work and play. But there are plenty applications that will simply disappear over time dueto poor design or lack of utilitarian value. As marketers grapple with the question, “to build or notto build,” let’s take a step back and evaluate what it takes to make a successful iPhone application-- one that will drive brand and revenue -- by using a simple framework for determining your iPhoneapplication strategy.What does it take to make a successful iPhone application?Before answering the question, we have to define what makes an application successful. SapientNitroalways asks why are we building something, what are we trying to achieve, and how are we going tomeasure it? Starting from top down, what are the business objectives, the key performance indicators,and the associated metrics? iPhone applications usually serve one of two purposes: to drive brand orto drive revenue.Objective: Drive brandApplications that drive brand most likely are free since they have to target a broad reach. The objectiveis usually to increase awareness, brand recall, or word of mouth, and is traditionally measuredbased on simple downloads, usage, and extended with how many share with friends, stickiness, andengagement levels. A good way to take it one step further is to tie in social media monitoring andanalyze share and velocity of voice, general sentiment, and overall impact of the application withinsocial conversations.Now that we understand how to measure it, what will the application do? Nowadays, brands cannotpush messages out to consumers, they have to provide real value and we generally call it brand asan enabler. Applications that drive brand usually fall under one of two categories: entertainmentor usefulness. Entertaining applications usually have a wider adoption, more downloads, but lessengagement as users open it just a few times before their attention is diverted elsewhere. Usefulapplications have a smaller reach but higher engagement; fewer users will download the application,but they will use it much more than simple entertainment applications. However, the key for both typesis simplicity. © Sapient Corporation, 02.2010
  2. 2. POINT OF viewObjective: Drive RevenueRevenue can be driven directly by the application, or indirectly by multi-channel integration with retailand stores. Direct revenue is generated by the application. Indirect revenue usually aims to drive usersto storefronts, partners, or otherwise provides reasons for the user to purchase products or services.Measurement towards these objectives is always dollars.Direct revenue can be generated from advertising or downloads, and both have different strategies.Revenue from advertising is similar to brand-driven applications: the approach aims to reach as manyusers as possible by providing free entertainment or utilities, and to collect revenue through third partyadvertising. However, download revenue can be more complex as it involves pricing strategy.The secret to maximize download revenue is pricing. The most popular paid applications are pricedbetween $0.99 and $3.99, with predominant 99-cents applications. These applications are what we callthe “big-fast sales.” Most users download them and use them once or twice; they’re predominantlyentertainment and provide small value to the consumer, but the mass download provides great initialrevenue and then stops. The most grossing applications are actually priced between $4.99 and $9.99at 44% and account for 44% of revenue. These applications are downloaded less frequently, but usedmore often as they usually provide tangible value.Here’s a simple framework to determine your iPhone application strategy:Set objectives – what is success? Drive Brand - Free Generate Revenue Entertaining Direct Revenue Indirect Revenue Useful Business models Revenue Models Cross / multi-channel • Free apps • Via ads Point-of-sale • “Big-fast sales” • Via downloads • Sustained sales Pricing Structure • Most popular $0.99 at 50% and 0.99-3.99 • Most grossing $4.99-9.99 at 44%ConclusionSo what does it take to make a successful iPhone application? You need a strategy, know what youwant, how to get there, and how to measure. Keep it simple, make it engaging, and provide a means toshare and pass-along. As a director of digital strategy at SapientNitro, Gonda is an interactive technology guru, who provides the knowledge and experience required to run high-level, multi-channel interactive campaigns that reach millions of consumers. Gonda has more than 15 years of experience in web development and 360-marketing campaigns for clients such as Adobe, Guinness, Toyota, Taco Bell, NBC and others. His areas of specialty include emerging technologies, marketing strategy, social media, rich Internet applications, service-oriented architecture, mobile, agile methodology, automation, behavioral targeting and multi-channel synergy. Before joining the leadership team at Sapient, Gonda was co-founder and chief technical officer at iChameleon/group. He is a frequent figure on the speaker circuit, having presented at conferences such as Adobe Max, OMMA Mobile, and SXSW.This article was originally published in Freelance Review, December 13, 2009. © Sapient Corporation, 02.2010

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