Sponsor Me, Not Just My Content: Can Next-Gen App Stores Learn Some New Tricks?

Will Microsoft’s Windows 8 really make a splash on mobile devices when the full-bore marketing and hardware assault hits this fall? Who knows? My guess is that the odds are against Microsoft on a number of levels. First, there is the track record thing: Zune, Windows Phone, etc. Aside from Xbox, the company has had some serious trouble getting off the desktop. And then there is the sheer momentum in the tablet market that Apple has already generated.

These tablet devices are still expensive enough to force a highly considered buy. Who is going to take the chance on buying into a platform that could be dormant in six months when the same price buys into a thriving and totally engaging app ecosystem? And at the low end, Amazon, Barnes & Noble and probably Apple itself will be capturing the entry-level buyers with $200-$250 half-sized tablets in the same holiday season. I just don’t see it.

But if the Win 8 tablets fail it won’t be for lack of trying. By cultivating a cross-platform app ecosystem, Microsoft is giving itself a fighting chance here. And on Friday the company rolled out more detailed plans for helping developers monetize their apps. In a blog post at the Windows Store for Developers site, the company outlined how its app pricing will work for publishers. They are aiming at levels of flexibility that eluded Apple and Google in their first stabs at this. Developers can use flat-fee structures, a time-limited trial, a feature-limited trial, in-app purchasing and even third-party transaction platforms.

Microsoft is using a progressive rev-share scale, where developers get 70% of revenue on the first $25,000 an app makes, which then escalates to 80% beyond that. Interestingly, Microsoft seems to be increasing the standard price floor of apps, from Apple’s 99 cents to $1.49. The upper end is $999.99.

The company appears to be simplifying the all-important trialing model by building “Buy” and “Try” options into the sell sheet for each app. By using this interface, Microsoft promises developers the ability to use a single code base for trial and pay versions and to have a built-in analytics engine to evaluate conversions. Available APIs can remind users of pending time limits and the system prevents opening apps after a trial expires.

And of course developers have access to in-app advertising. The Windows 8 Advertising SDK is also available. One of the pushes the company is making among advertisers is for what it calls “polymorphic” ads that will work across Web, Xbox, tablet and phone. Chrysler’s Fiat will be the first test of the multi-screen app ad approach, Microsoft announced at Cannes. Early partners with Microsoft on its app advertising plans include AKQA, Razorfish, Team Detroit, UM, Y&R and Big Spaceship. Microsoft is touting a next-generation advertising vision where ads focus on end user experiences.

Yeah, yeah, yeah. We have heard this all before. It is not clear to me that the Fiat ad I saw in their demo was much more than, well, a branded app everywhere.

But to its credit, Microsoft is exploring new screens to good effect. Personally, I find the current Xbox ad units striking, if only because they are nicely woven into the Xbox Live flow of content discovery and actually come to life when the cursor highlight passes across them. There is the opportunity within a rich app interface for a branded experience to communicate its value more overtly. And it is within this ecosystem that the app can actually provide value by enhancing the experience the user came for in the first place.

One of the things that game advertisers learned years ago (but too many interactive advertisers ignored) is that the first impulse to advertise in games was probably the worst approach. Instead, by sponsoring game add-ons and other enhancements, marketers found they got more traction and attention from gamers by underwriting their passion.  

There is a real lesson in that. Underwrite the passion and purpose, not the media. A highly personal media environment demands a deeper reimagination of advertising than just branded apps. The app environment is one of interactive utility and entertainment. We are no longer just exposed to mass media, where an interruptive spot was really just a native ad unit that conformed to a lean-back consumption experience.

Maybe we have to stop thinking about media as something that is “consumed.” This is different in kind. We take highly individual daily “journeys” through multiple media and tool sets throughout our day, made all the more personal by the devices. We are making decisions about platforms and pairing devices to moments of the day and specific needs at every turn. The level of purposefulness in this journey is pronounced and altogether different from the last century of radio, TV, newspaper and film. You can be my companion on my daily journey through information and fun, if you enhance the journey. Think about ways you can sponsor the person -- not the content. Sponsor me.

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1 comment about "Sponsor Me, Not Just My Content: Can Next-Gen App Stores Learn Some New Tricks? ".
  1. Allan Bennetto from JMango , July 25, 2012 at 6:57 p.m.
    Hi Steve, your last point about 'consuming' media is spot on.. changing the attitude about media is a great way to look how to enhance the user experience and interaction with brands. Old hat advertising I think will soon render itself obsolete anyway as consumers turn off. It will be interesting to see how this plays out with Windows 8, however I think they are definitely heading in the right direction.