Competition is fierce among leading brands to have the best app
By Chantal Tode
August 6, 2012
Mobile ad spend spikes as smartphone penetration grows
Leading brands across several categories are pouring significant resources into mobile apps in hopes of gaining first-mover advantage as well as the awareness and loyalty that can come with being seen as an innovator.
It is happening with growing frequency – a category leading brand comes out with a new, interesting feature for its app and soon after, the competition releases similar functionality. The use of apps as a way to gain an advantage over others is clearest in categories where there is already significant competition for consumer attention, including quick-service restaurants, banking, hospitality, fashion and beauty.
“We're seeing aggressive competition in hospitality and consumer banking,” said Jabari Simmons, director of user experience with Arnoldnyc, New York. “Brands like Starwood and Marriott frequently update their iOS and Android apps, not only competing with one another, but with online travel agents like Expedia and Travelocity to retain market share and share-of-mind with bookers.
“In the banking space, ebanking apps are central to the value propositions of Chase, Citi and Bank of America, and these three banks not only compete on a feature-by-feature basis, but tout their apps in their traditional advertising,” he said.
“While a brand can afford to be a second entrant, being the third or fourth in market with a feature set can do real harm to a brand.”
Digital content brands such as Pandora are also pouring significant resources into their apps as mobile use is growing quickly and, in some cases, surpassing desktop use.
Brands are finding they can use apps as a way to position themselves as innovative, a trait that consumers are very interested in these days as the buzz around the launches for new smartphones illustrates.
“When consumers come across software that takes advantage of their hardware in ways they’ve never imagined, they’re eager to download because it reminds them of the excitement they felt when they first purchased their device,” said Dave Martin, senior vice president at Ignited, El Segundo, CA. “Especially if that app has real utility or entertainment value.
“When brands can tap into that kind of excitement and engagement, it not only can be another marketing touch point, but can also help position that brand as an innovator, which can often be a way to distinguish it from its competitors,” he said.
Wendy's new app
Keeping users engaged
Adding new features can also be a key method for keeping users engaged with an app. As a result, it may make sense for brands to get out there with an app that has several key features and then focus on regular updates that add new functionality.
For example, Wendy’s recently launched its first brand app and the main feature is a calorie counter. The quick-service chain plans to build a more robust app over time as it sees how customers are using it.
Target and Kraft are other brands that focus on updating their main app frequently.
In comparison, some brands take a long time developing an app with many features at launch, which can delay the launch.
“It is the frequency of refreshes and addition of features that helps keep consumers engaged,” said Stephen Burke, vice president of the mobile practice at Resource Interactive, Columbus, OH . “We try to get our clients on a cadence that has them doing refreshes frequently.
“It is a battle we all face — how do you generate and then maintain mindshare with consumers,” he said. “Do you have a single core app that does everything or do you have multiple apps, campaign apps and seasonal apps. The jury is still out.”
What users want
However, the focus on having the latest and greatest app features may not make sense for all brands.
One of the key benefits of having an app at all is the rich usage data it provides, giving brands a way to focus more on giving customers what they want instead of chasing the competition.
“We can spend a lot of time doing competitive analysis but, at the end of the day, the metrics that come from your app and your Web site should be what guides the evolution of these,” Mr. Burke said.
“In general, you really want to focus on your consumer and enhance those features that make sense,” he said. “Getting into a competitive arms race is not the best use of resources.”
Chantal Tode is associate editor on Mobile Marketer, New York
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