More and more corporations are entering the mobile app market. The trends are clear that corporations must find ways to go mobile with the explosion of the smartphone market, and with that, the mobile app market. In 2009, corporations that were in the app market were just trying to get their feet wet and find out what mobile applications were all about – a first-mover strategy. Success of internet-based corporations in the app market, such as Amazon and eBay which boast large profits as a result of going mobile, suggest that other corporations should adapt their business model and find a mobile strategy of their own.
Mobile app strategy 101
While it may be easier for internet-based companies like eBay, Amazon and Facebook to enhance their business by going mobile, businesses that are not primarily based online are likely to find the move to mobile more challenging. Reasons for corporations going mobile include branding, marketing, online commerce and to improve customer service. When implementing these strategies corporations do not always tend to redefine their business strategy and take advantage of what ‘going mobile’ offers them. To have a successful corporate application, a company cannot simply issue an app. Instead, it should incorporate and take advantage of what makes going mobile unique, for example, the use of location-based technology to enhance the sense of place and alert a user when their product is nearby.
Avoiding the mobile game trap
When deciding how to create an app many companies fall into the game trap. Although games are among the most popular apps used, corporations should not look for ideas for how to turn their business into a game. This concept frequently has neither longevity nor capacity for returns. Since an application is actually downloaded onto a smartphone, consumers expect to use the application more than once. Unlike visiting a webpage, an application is supposed to give something beyond enhanced information to the user. Corporations logically assume a game would be the perfect way to expose their brand or product with an app because we are familiar with mobile gaming systems on a small screen. However, the app function should be approached with caution. When you create a game app, you run the risk that the game has limited use or functionality. The game app also limits the ability of the corporation to increase direct or indirect sales with the app or establish another link to better customer service, both of which could have a more significant impact on sales than games in the long run.
Make a business out of mobile
As the mobile app market moves out of the infant stage, corporations should start synergising their business with the current dominant app business models. The main business models in the app market are paid apps, advertising and mobile commerce. Most corporations stay away from paid apps, which is generally a smart idea, and mobile advertising is just starting to become big. Mobile commerce is growing rapidly and other smaller companies are also reaping benefits, such as Shopgate, a mobile platform for small retailers launched in April 2010, which is generating 200 orders per month. While it may be difficult for some corporations to come up with a direct mobile commerce application, they should take the success in mobile commerce as an indication of how willing consumers are to integrate mobile into all different parts of their life. Thus, corporations should move beyond having a mobile app presence and start to think of ways their business can become mobile without just being mobile.
About the authors:
Dr. Torsten Oelke is the author of the book „Stars of the Internet“ (German), which looks at the reasons behind the success of some of Germany’s most successful entrepreneurs. He was formerly a management consultant at McKinsey and is currently part of the DTO group, where his focus in on the Internet, venture capital, private equity, energy and real estate. He is also the managing director of Smart Mobile Factory, which helps companies come up with mobile business models. SMF is a dedicated mobile app developer, taking ideas from the concept/ drawing board stage right through to design, implementation and marketing. Kristen Knorn is a Senior Associate at SMF.