Sometimes the best advertisements say everything they need to say….without saying a thing at all. Hat tip Apple – you’ve nailed this one.
Apple is the latest retailer to create an app that allows direct purchase from the users mobile device. It comes at a fortuitous time as their website (and AT&T’s for that matter) are overwhelmed by customers trying to pre-order the latest iPhone as demonstrated by Digg founder, Kevin Rose‘s latest tweet:
“sweeeet got my iphone v4 pre-order in, pro tip: use the iphone app “apple store” to order, much faster..”
Others online purveyors have taken to mobile commerce with astonishing success – take eBay as a shining example. In March, they related the following stats to the NYTimes:
“Eight million people shop eBay on their iPhones. Mobile commerce generated $600 million in merchandise volume last year, and eBay expects that to increase to $1.5 billion this year.”
That’s some serious cash – amazing what putting a mini shopping engine in the palm of a customer’s hand does.
What’s the one personal item most people can’t live without? I bet if you ask the average person on the street, the majority would answer ‘My mobile phone’. It’s a connection point to friends and family that is almost always with you. You use it for voice, email, quick text messages, and in some cases (more often outside of the U.S.) it is your only computing device.
Think about the iPhone and the recurring line you hear on most Apple commercials: ”There’s an app for that“. It’s true – the iPhone has quickly become many consumers only ‘connected’ device and because of that, Apple has single handedly made the mobile space relevant to marketers and advertisers. If companies aren’t paying attention to the opportunity mobile provides, they are missing a major piece of their marketing mix. Rachel Pasqua – Director, Mobile Advertising @ iCrossing supports this in her interviewwith eMarketer this week:
“Most major brands, if they take a good, hard look at their site analytics, will see a significant amount of traffic coming from mobile devices—mobile devices that won’t be able to handle their desktop site to the best advantage. I think failing to take those users into account will have serious repercussions.”
Given the fact that mobile advertising is growing at a staggering pace (Magna forecasts the U.S. market for mobile advertising will grow by 36%, rising from $169 million in 2008 to $229 million during 2009) the mobile medium has to be in your marketing mix – not as necessarily as a primary component - rather, as a complementary or ‘companion’ to your more traditional media vehicles (retail, online, television, print, and out of home). Brands and Marketers that recognize the importance of mobile will create new avenues to intersecting their customers and influence their perception of the brand, regardless of their location.
Think about the social communities that are successful – they build upon people’s passions – gaming, photography, technology, parenting. Nike has built a phenomenal community with Nike+. It’s the people that are passionate about running and sharing their efforts that makes the community successful – kudos to the folks over at Nike for recognizing this. Nike has done a great job of building an online area that helps people celebrate their successes, ask for advice, track their progress towards personal goals, and join others in discussions about their training and racing experiences.
In addition, Nike has identified key areas where they can ‘add value’ to the community experience – simple things like providing a ‘goal’ or ‘challenge’ area to keep members of Nike+ motivated and driving towards a target. There is also a virtual coach that will guide you towards a tailored program to achieve the goal that you have set for yourself – be it a marathon, half marathon, or simply shedding a few pounds and increasing their commitment to fitness.
Finally, they have focused on a key partnership with a technology giant that everyone recognizes – Apple. By pairing the iPod and Nike+ the community is able to download coaching sessions and workout song mixes directly from iTunes to help power them through their next session. Hat tip to Nike for recognizing what’s important to their running/fitness community and providing them with the tools that keep them coming back for more. Through this, they’ve built a following to their site that is very loyal and returns regularly to contribute to, and gain from, a community experience.
An amazingly simple concept – offer a GREAT service (for free) on a device that everyone wants, make it easy to bookmark their favorite tunes, and offer a path to purchase - people will not only be fans, but they will stray from ‘free’ long enough to pay for the tracks they really care about. While Pandora doesn’t make much from the sale (the two commerce options, iTunes and Amazon, take home the bulk of the profit), it does provide them with an additional revenue steam outside of simply selling advertising through the site. According to TechCrunch:
“Users are buying about a million songs a month now from these affiliate links on Pandora…. Of those, a solid 20% are coming directly from Pandora’s iPhone app.”
Pandora was smart to partner with Apple. In return for adding value to the iPhone through it’s app (most downloaded app in 2008) – the company is gaining customers it might not otherwise have had.
I’ll reiterate the title of this post: Cool Device+Cool Service = Happy Customer+Revenue. I’m a fan and a happy customer of both. I’ll be streaming Pandora in my car as I head out on a roadtrip this weekend – maybe I’ll even buy a track or two along the way…
Apple does it again – setting the bar that will be very difficult to for others to meet as they close in on their 1 Billionth (not sure if that’s a word) download. Rarely can you turn on the TV without seeing an iPod or iPhone commercial, and typically the spot shows off some great app to make your life easier – often generating the ‘why didn’t I think of that?’ emotion in me. The most astonishing part…the App Store has only been up for about 9 months – talk about rapid adoption. Hats off Apple – another job well done.