Mobile monetization, once a pipe dream for participants in the digital content space, has reached a tipping point.
The ability to close a financial transaction in mobile previously relied upon a web browser, premium SMS, or actually performing the transaction through a separate channel and then completing it through an app.
But new technology that’s secure and user friendly is giving app producers the tools to create meaningful in-app experiences while earning real revenue.
Freemium comes of age
Many developers still use some form of in-app advertising to fund their apps, but the real breakthrough of 2011 was the advent of the freemium model.
What started out as a “try before you buy” approach has grown into something much more significant, where brands offer their apps for free, and then encourage users to sign up for a subscription, or sell them a product within the app.
Of course, publishers can still charge for their apps or pursue a more niche (and controversial) strategy of collecting user data and then reselling it. But the fact is that in-app monetization today is primarily driven by freemium downloads.
Apps as brand extensions
Some businesses are launching apps with no intention of earning direct revenue from them. Brands like Facebook and Google (not to mention almost every airline) are able to justify the expense of mobile on the basis of the lift a compelling, useful app may give the rest of their business.
But of key importance for brands is uncovering how their core value proposition can be extended to their mobile audience.
In the case of Google Maps, it is easy to see that mapping through a handheld device is a natural fit. For airline or hospitality apps, it means providing utility for the traveller through features like mobile check-in and flight updates.
The key takeaway for brand marketers is that mobile apps can help them serve and retain the customers they’ve already earned.
Monetizing magazine apps
For media brands, mobile is an opportunity to deliver content to audiences that may have previously been out of reach. The Hockey News (a Polar Mobile client), for example, maintains one of the oldest professional hockey destinations in the mobile world, and is itself a venerable ice hockey institution.
But beyond providing a compelling mobile experience for existing users, the app has led to increased print subscriptions and newsstand purchases.
By building brand awareness in the mobile space, the publication was able to reach people within the North American market it already served who were previously unaware of the brand and who were not being reached by its traditional marketing efforts.
Needless to say, this surge in print sales occurred while many other legacy magazines and newspapers were folding, or shifting toward digital-only models.
It’s still early days in mobile
The ability to monetize through mobile, directly or indirectly, is no longer a pipedream. But it’s worth noting that mobile is still in its infancy and that the app industry will continue to evolve rapidly in 2012.
The early winners will be the brands that invest in building relevant and useful products for audiences old and new.