By the end of 2013, roughly 1.4 billion people are predicted to have a smartphone in their hands. And this means that “the most valuable digital real estate in the world,” writes Russell Glass, CEO at Bizo, is “the home screen of a smartphone.”
But ecommerce still hasn’t quite decided how to best monetize this prolific platform.
A Free Phone?
The average consumer unlocks his or her home screen about 110 times per day. This makes the possibility of 3,000 impressions per month, per person, calculates Glass, making the home screen the most incredible advertising space “in terms of per use economics.”
In addition to a great number of consumer impressions, smartphones also provide a uniquely interactive interface. Apps and sites can integrate with the features already on the device such as the camera or GPS location tracking. Taking advantage of the interactive nature of the smartphone presents both a challenge and a unique opportunity when it comes to monetizing smartphone use.
One possible answer to this is the proposition of an entirely free phone funded by ads. In a column for AdExchanger, Russell Glass predicted that an ad-supported mobile phone would be the next big thing in 2014.
Ads would be enabled on the home screen and users would agree to the tracking of their location and purchasing habits paid for by advertising companies in exchange for use of a free device and service. Glass believes that while it may take time to catch on, consumers would be interested since many ads are already a part of television and mobile experience.
Image Credit: http://blog.inner-active.com
The Post-PC Era
Though it sounds revolutionary, the prevalence of mobile should come as no surprise. An editor at Bangor Daily News recently declared the “post-PC era” to be in full swing. And “in many ways,” agrees Christina Warren writing for Mashable.com, “the mobile app today is what the website was ten years ago—one of those tools that has transferred from being a luxury into a necessity for businesses of all sizes.”
So innovative solutions like a completely ad-supported phone should be cropping up left and right as businesses seek to capitalize on the new frontier of mobile.
Strategies for Monetizing Apps
At the start, most apps made their money through purchase prices in the app stores. But now, businesses are realizing more creative ways to make capital that help “drive sales, promote brand and generate advertisement revenue,” reports App Developer Magazine.
1. Subscriptions
One of the most popular uses for mobile devices is downloading news, entertainment and sports. The number of users who utilize their phones to surf the web, read and watch video is quickly surpassing the consumers who use a desktop. Businesses can capitalize on this use by selling subscription plans for e-magazines, video and music streaming and other sites. Other companies clever offer free versions with advertisements. As users become dependent on the content, they may be willing to pay a subscription fee to unlock new content and remove ads from their experience.
2. The Dual Advantage of Ads
Many consumers are already accustomed to sitting through TV spots to pay for their programs. Apps have caught on to this. Many free versions of games and other apps run large ad banners. They balance between annoying advertisements and useful content or catchy entertainment to keep users playing. While the app is already making money from its ads, it can cash in again with in-app purchases. Once the consumers are hooked, they may be willing to purchase an ad-free version or pay to unlock new levels and additional content.
3. Virtual Catalogs
A new trend has “been gaining traction” recently. This is the building of apps which resemble an old print catalogue that contain any combination of the following:
- Products
- Services
- Locations
- General information
The app is downloaded for free and acts as a platform for purchases, much like a mobile website. Additionally, the company can use this app as a marketing strategy, sending users notifications and promotional deals through the app. It is a combination of purchasing and branding.
4. Geo Targeting
Another new method of indirect mobile marketing is called geo targeting and proves especially effective for small local businesses. This kind of mobile app will notify a user when they come upon a new street or area. The notification will display information about the new place with relevant facts about businesses, products and services available there. The app works to provide recommendations based on the user’s preferences as well as location.
The Cost of Building an App
Right now, creating a quality app is a pricey endeavor. But you may only need to take out an Instaloan to fund app creation in the near future. Some experts predict that like websites with the dot-com boom, as popularity and use continue to skyrocket, the price of building a custom app will eventually fall.