Reasons Why Your Mobile App Isn’t Effective
Mobile marketing is a powerful way to reach customers right on the device they carry with them at all times. There are seemingly endless ways to reach your audience, from banner ads to pop-ups to podcasts. One of the ones that gets the most attention from local businesses is mobile apps and push notifications.
The Mobile App Marketplace
Nielsen recently released new data about the top smartphone apps in 2016. The results are striking, but hardly surprising.
Let’s unpack that chart.
If we convert those apps to the names of the companies who own them, you’ll notice a pattern:
All of the top 8 mobile apps are owned by Facebook and Google.
On top of that, take a look at those staggering numbers. Even the bottom of the list, Instagram, boasts upwards of 74 million unique users.
Don’t feel bad- not even Apple is making the list of top apps on their own store (Apple Music clocks in at number 9).
So what about challengers – which new apps are smartphone users downloading? Turns out, they’re not.
Smartphone users in general aren’t downloading new apps.
So why does this matter to you?
We hear a lot of local businesses – particularly restaurants and retailers – touting their loyalty apps.
Having an app is a shiny, exciting prospect for a lot of business owners and marketers. But don’t jump too quickly into the app marketplace.
There are two types of loyalty apps we hear of most often:
Custom Loyalty Apps
On the surface, custom apps sound like the holy grail of mobile marketing. An app that’s all your own, available to every customer on the app marketplace, with which you can send push notifications whenever you want.
Let’s take a step back and look at what we know.
People aren’t downloading new apps. The likelihood of your customers finding and downloading your app are slim. Downloading an app takes data and storage, commodities that users aren’t fond of using up.
Development costs money. Today, there are more and more DIY-options that offer drag-and-drop app development, but even a cookie-cutter option like that has a learning curve. The alternative is hiring a reputable developer, and that’s a heavy investment.
Shared Loyalty Apps
These are applications that pool together sometimes hundreds of local restaurants and retailers that offer deals and coupons. Users can search for the business they’re heading to, see the deals offered, and save some money.
Competition, competition, competition. Of course, this means that a business is in direct competition with any and all of its direct and indirect competitors, even within the same app.
It’s not a draw-in method. Savvy business owners know that they can use coupons or specials to bring in new customers – even if it means sacrificing a percentage of the revenue, you’ll still make more money than if the customer didn’t come in, as long as there’s still a profit margin. The issue with shared loyalty apps is that users don’t see a coupon and decide to come to your store. They decide to come to your store, then check the app to see if they can pay you less money. Smart by the consumer, but a revenue hit for the business.
This, of course, brings up the argument of push notifications – or, as we like to call it, the fallacy of push notifications.
The Push Notifications Fallacy
The common argument is that businesses can get around these app drawbacks with push notifications. The thought seems to be “I can get my customer to download my app and I’ll send out notifications through the app.”
We’ve already discussed how shaky the first idea is. But what about push notifications – do they work?
First, research shows the ineffectiveness of push notifications. It shows that of those that are willing to download an app, an overwhelming majority (up to 80%!) do not and never enable notifications.
Anecdotally – how many apps do you have notifications turned on for? If you’re like most, the answer is pretty clear – none or maybe a handful.
Again, let’s look at what we know:
- If we start with 100 people, and 88% of Americans own a smartphone, we’ve got 12 (glorious throwbacks) that are still rocking flip phones. They’re out; they don’t have a device that can even download an app.
- There are 88 people left. Of those, another 43 are out – these are the 49% of folks who own a smartphone but download 0 new apps.
- There are 45 people left who download at least 1 new app a month. In all likelihood, they’re downloading one of those top 8 apps – Facebook or Google.
- Let’s be generous and say that you do a remarkable job incentivizing your app, and 25% of the folks left download it.
- There are 11.25 people left. Now for the kicker – 80% of smartphone users turn off push notifications.
- There are 2.25 people left who might get your push notification.
- How many of those 2.25 are going to see it and ignore it?
The Simple Alternative: SMS Marketing
There is one important smartphone app that isn’t listed in Nielsen’s study: Messages. The simple text message is present on just about every phone out there.
One more time, let’s take a look at what we know:
- Text message capability is built-in to every phone made since 2005.
- There’s no app to download.
- Users opt-in to receive messages – unlike push notifications, they WANT to hear from you!
- It takes no data, and most major carriers offer unlimited texting as part of their standard plan.
- Text messages have a 98% read rate within the first two minutes of delivery.
- We’ve seen redeem rates on offers, discounts, deals, and specials sent through SMS marketing as high as 12-20%.
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