From the outside looking in, the whole mobile app business can be confusing and leaves a lot of non-mobile oriented businesses out of the loop. Here, we will focus on bringing small business owners and other decision makers up to speed on the possibilities mobile apps offer for growing your business. For the most part, it is relevant for the full spectrum of small business, from restaurants to legal services.
Where nearly every product or service you offer has a price tag, a majority of mobile apps do not. Most mobile apps are available for free and make money through in-app purchases and/or advertising. The special point to observe is that almost every dollar generated by a mobile app from any revenue source accrues first to breaking even on development costs, and thereafter to its profitability. Many retailers purchase products at 40 -80% of their sale price, may incur shipping & handling charges, alongside other overhead expenses. You have a higher threshold to meet before your sales begins applying to your bottom line.
The second point to be aware of is that many independent developers are not breaking even on their development costs, but also a majority of developers are not very active in marketing their products. These points often go hand in hand.
Mobile advertising reaches more people dollar for dollar than virtually any other advertising method. Where your business may not be suited to having an app of its own, you might think, Why bother? This involves consideration of how your business reaches and attracts new customers – the effectiveness of your current marketing and advertising activities. This likely involves determining your target audience and selecting advertising venues capable of reaching it.
This is where the primary question comes in for you and your business,
Are there any apps or app developers out there trying to reach the same audience as you are?” Would you be willing to explore doing business with them?
This could take any number of forms. It could apply to helping finance or sponsoring an app or paying to run a coupon promotion through an app. The less your business requires customers to be local to you (i.e. an online store, subscription service, etc.) the better this can work for you. For more geo-centric business models, you may have to look at developers engaged in community-centric products. There are plenty of those out there.
Another component of this model involves expanding it to include several businesses related to the nature of a given app. In example, a strategy game might be useful in promoting a hobby store, a paint gun park, a similarly oriented book, ebook or movie, or even a web site. Suddenly, you can find your business developing networking relationships and promotional opportunities with multiple non-competing businesses.
The cost of advertising is the same regardless how many companies or products end up getting promoted by it. Within the mobile advertising market, it is most likely to be a mobile app that is the primary beneficiary of the advertisement. Once an app is downloaded and installed, each party participating with in-app promotions is reaching a customer in their target market. This also adds value to the app and increases the potential for it to be used more.
Take some time and talk to some local mobile app developers.