For Brands, Apps Are A Big Bust

Although awareness of mobile’s ability to drive sales has never been greater, a new report on brands’ mobile and tablet use finds that marketers are still targeting smartphones with dumb strategies.

“For brands, there’s still a pronounced disconnect,” says Colin Gilbert, research director at L2 Think Tank and co-author of the report. “If you look at it with a glass-half-full perspective, it’s worth noting that 80% of brand sites are mobile optimized, so the majority are making the investment.” But if you look at the amount of the investment, the return, and the goals, he tells Marketing Daily, there’s plenty of digital disarray. 

Apps are one of the biggest examples, he says. “You can see how a marketing exec would look at the stats and say, '85% of the time consumers spend on smartphones is with apps, so we need an app -- fast.’ But the reality is that three-quarters of that time is spent on gaming, Facebook, YouTube or social messaging.” No wonder almost 40% of brand apps have never even been reviewed by a user, and only 6% remain active on a featured list, he says.

You’d think brands would be less likely to release apps as a result, but the report found that the reverse is true -- and brands are racing to the app graveyard: Nearly a third of the 304 apps reviewed in the study were less than 15 months old, “reflecting steady investment and a high degree of churn.” Of the 97 apps released since January 2013, only 10 average one or more ratings per week, while also maintaining a three-star status. “There’s this 'fire and forget' mentality, since apps are easy investments to make, with a new campaign or collection. But very few had sticky functionality.”

There are also many missed opportunities on tablets, with 90% of brands relying on their desktop experience rather than a version optimized for tablet use. And one in seven brands has broken or unusable elements when loaded on an iPad. Yet tablets are the preferred mobile device for pre-purchase research, and matter more than smartphones for second-screen viewing. (While roughly an equal share of tablet and smartphone owners -- 40 versus 46% -- report using their mobile devices while watching television, tablet owners are 1.5 times more likely to buy a product being advertised, the report says.)

Even email is problematic. While the number of emails opened through mobile phones has increased 21% and more than half of all marketing emails are opened on phones, click-through rates are still low. That’s not much of a surprise, considering that just 56% of retailers' email meet readability standards for mobile.

L2’s research focused on four areas -- mobile sites, tablet optimization, digital marketing and mobile apps -- and included 126 brands across fashion, retail, beauty, watches and jewelry. In addition to assessing the pace of investment, it was also looking for pockets of innovation, with brands like Nike, Home Depot, Macy’s and Crate & Barrel emerging as the best in creating experiences that "are consistent across channels, yet play to the different, specific strengths of each device."

Department stores have a bit of an innovative edge because they have done better at integrating camera functions, barcode scanning, and mastering just how data a smartphone can effectively retrieve over an in-store wireless connection. Sportswear companies, such as Nike and Adidas, have a higher level of expertise thanks to their devoted wearables audience -- shoppers who have already made a big digital commitment to the brand.

But on the whole, he says brands are “shifting their mentality from 'mobile is a device customers can check out with' to 'mobile is a device that reinforces a positive shopping experience'."

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4 comments about "For Brands, Apps Are A Big Bust".
  1. Rachel Miller from ion interactive , May 20, 2014 at 11:47 a.m.
    This article certainly raises some questions about apps and how/if brands should use them. The most important thing a brand can do is to identify where their customers are before just throwing apps up everywhere. The app landscape has evolved to allow brands to pick tools that work specifically for them instead of being pigeonholed to only do a mobile app, or tablet app. With tools like marketing apps, brands can truly pinpoint where their audience lives and develop a browser-based experiences that will reach them using the devices THEY like to use. It's a win-win situation!
  2. Kenneth Hittel from Ken Hittel , May 21, 2014 at 4:30 p.m.
    "There's an app for that," right? At the end of the day, brands must answer the question: What is our "that"? Unless and until you have a really good answer to that question, you can do no more than waste time and money while populating the graveyard of apps with one or several more irrelevant apps.
  3. Neil Hunter from Consumer Kinetics Inc. , May 22, 2014 at 12:25 p.m.
    The article has some great facts in there, but it really does miss the point of what can be with the right strategies, and a focus on influence at the ideal moments. It mentions all the failings of marketers strategies. Yet it doesn't deny that the most powerful thing a consumer carries with them in store, with the exception of their wallet is their phone(yes one in the same soon). It's power is constantly mentioned in articles but in practice it is being largely ignored. Having the consumer on the phone in trip planning or in store is akin to calling them as they stand at the shelf and discussing what item they should pick up. That is the power of mobile, and these apps or tools already exist. Building a brand app that serves minimal reason to be opened, misses a little of what can be the magic of an app, but you can't fault them for trying. There are tools that give true and in near real time ROI tracking and cost certainty, and have figured out the "Natural Open" of an app that the article indicates largely are in the utility of apps with the examples of mail, weather, or social apps. Their use of the the term "Dumb Strategies" I won't deny but I do wish these articles used more solution inspiring terms than slighting those that saw the potential, and just missed the path a little. Marketers all is not lost, moments of influence via apps do exist, as does regular interaction. The article defining user interaction with the number of reviews, is like measuring share by using "LIKES" instead of POS data. PLEASE tell me it hash't come to that. Get on the phone with your desired consumer, and use those moments of influence wisely for your brand benefit.
  4. Robi Ganguly from Apptentive , May 23, 2014 at 8:14 p.m.
    Neil is spot on - the fact of the matter is that the phone is the most intimate device customers own. Just because we're in the early days of creating mobile apps and it's proving to be challenging for some brands doesn't mean this isn't a great avenue for direct to consumer connection. In fact, the companies that are constantly investing in figuring this medium out are the ones making meaningful progress. It's similar to the early days of the web. Furthermore, companies who view their mobile apps as connection channels to have truly 1:1 relationships are winning in a massive way, by actually being able to re-engage through in-app messaging, do research through surveys and really connect in a human manner. We've found that ratings and reviews are useful indicators of the traction and connection brands are making and actually released our "Love Score" around this concept a bit ago to help brands better understand how they're doing: http://www.apptentive.com/blog/announcing-apptentive-love-score/ as well as how to improve their adoption.