App Everything (and how to make money out of Apps)

apple-itunes-apps-app-storeThere are millions of apps out there. Apps that allow you to see your finances online, social media apps, apps showing location of your dog or a car, also known as GPS apps, an app for this blog (which is not officially out yet), an app for my gym (because why not?). Well, you got the point.

My favorite app is the remote controlled room temperature app. Basically, you can adjust your house temperature before you get home. Specially good for saving energy, for when you are not at home, in countries where it always snows or cold. You do, however, need to connect a small electronic device to your central heating, and that’s how the companies that promote this app make money (which is why this app is one of very few apps that actually makes money with the TV advertisements, which we all know can be expensive).

It is also interesting to notice that companies like TomTom are concerned with bringing internet to everywhere and everything in the world. Their own estimation is that ONLY 1% of the world is connected through internet, which is not good enough, because plants in your home don’t still have a microchip that would send you an App’date (I want to say App for Update, not App for Dating) on your phone saying that the plant needs some water (which by the way already exists), or anything else you want to have done remotely.

So, to sum up, today there are app’s for almost everything. If you, or your industry does not have an app, it means that you are in very “exotic” niche, or that you need to get it right away, because apps, is just a new way of promoting yourself and your company.

If you want to make some money out of apps, you have several solutions:

– Promote yourself or your company through the app (as mentioned above);

– Sell the app;

– Sell the ad space on your app (or should I call it “selling app space?”);

– Have a Razer Blade pricing strategy, which means giving away apps for free (razers), as long as you sell microchips (blade), or anything else that cannot work without an app.

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Why God is Losing Popularity According to Marketing Theory (and how to solve it)

God + religion + technology + new ageUp to 18-19th centuries, the time of of enlightenment and scientific and industrial revolutions, it is fair to say that people where much more religious, in a sense of how much involved they where with religions (specially in terms of time they have spent with it).

After this period religion started to progressively lose its followers, which was countered by progressive increase of Marketing. Specifically, marketing provides different information about what is out there. By developing peoples knowledge about other activities and creating new interests, people started to spend less and less time with “God”.

Additionally, new technologies are much more computer based, meaning that people spend less time reading books and much more watching TV, watching videos on their computers, listening to music, and so on. This was not possible back in the day specially with information control policy imposed by the church.

This is still very well seen in very religious societies such as Islamic and Arabic societies, where the technology is still not very wide spread and where there are still legal limitations on information flow (Marketing flow).

Therefore, if religion is to continue with the progress it needs to become part of the progress,to use Marketing and to spread itself into new media channels such as facebook. It also needs to promote itself, in order to remind people about itself, because people have limited cognitive capacity, meaning that they can only remember / do limited number of activities at the same time.

Words to describe a product

Thumb up“Fresh”. What do you think about when you hear “fresh”? More than fresh cloth after washing machine, I want you to think about brands.

Fresh could be Coca-cola or any other soft-drink from that category, such as RedBull, etc.

Specifically, though, when I hear “fresh” I don’t think of Redbull, although it is “best served cold”. SO, what word than you think when you think Redbull? Energy, extreme sports, …

Well, I found a great word that people don’t often build associations around, because it is very specific: “Exchange”. Of course when you think of “exchange” you think of finance world, and there you can’t find any drastically new products nowadays, associated with exchange. So it is a hard word to use, and it represents something solid, that exists already for some time, something that has to do with the power of money. Still one company managed to use it.

I am referring to an NGO (Non-Governmental Organization) Global Exchange. What they do is important, but of little importance for this post (save the world, in three words), but the association they create is powerful.

Just think about it. “Exchange” we already defined. “Global Exchange” is a company dedicated to make a world a better place, and while the money is not specifically a good association for Global Exchange, power is a good association even for non-profit organizations. For example, if Global Exchange is to ask you for money, than they are asking it from a perceived position of power; if you are to look up “Exchange” online and you will see this NGO, you will immediately remember that finance is not only about making money, but also about giving money, and what is closer associated to money than finance?

I won’t go any further into the debate about associations, but I do want to leave this idea planted in your mind that there are words out there that are very strong, but underused. If you sell cars, you don’t have to only use industry overused words, but you can get creative and position yourself differently from others.

In the end, people don’t only buy products, but also ideas behind these products.

(For more information about associations check Associative Network Theory)

Rules of Consumption

Few years of working is enough to realize that you can, and definitely  should, tell consumers what to do. I call these “what to do” instructions as “Rules of Consumption”.

By Rules of Consumption I mean giving consumers directions and guidelines on how to do virtually anything.

Going back to Psychology, which is my favorite subject, one can easily imagine that people are very flexible and easily adjusting “mechanisms”. They generally like to have control and structure in their lives, which they establish through rules and regulations (“do this”, “don’t do that”) and once established, try to communicate to other people in order to create symmetry of behavior.

Rules and regulations are necessary for several reasons, such as to avoid old behaviors that are known to be undesirable for a person or a society, as well as because adjustments require usage of mental energy, which is limited. On this account, people will only adjust in situations which they think are worth the conscious effort. However, in small, everyday situations people often prefer to use pre-established routines, or is the case of this topic at hand, pre-established established rules – Rules of Consumption.

 

 

Copycat business model

In recent study by Horen (2010), the author for the first time touched on a controversial topic of effectiveness of copycat products.

Copycat products are imitations of the original product, in all sorts of ways, as for example, color, design and packaging. They are not counterfeits, as counterfeits are outright copies, which claim to be the originals.

The first thing on everyone’s mind are the legal issues. However, I picked up some figures from the article itself to back up that this business model is not only morally justifiable, but that it is actually popular:

– National survey in US’s supermarkets showed that half of the store products imitate the leading brand package, in at least their color, size or shape (Scott-Mortan, and Zettelmeyer, 2004);
– Outright package imitation occurs in 1/3 of 75 consumer packaged good categories (Sayman, Hoch, and Raju, 2002).

However be aware!:

– Trademark transgression was estimated to be of 512$ billion in 2004 (Zaichkowsky, 2006).

So whats makes a copycat product effective? The findings of the present study point out to the idea that feature based copycats (e.i., logo, brand name or packaging – e.g., cow looking left in Milka) are much more popular (and more legally persecuted) than the theme based copycats (e.i., the general feel of the product – e.g., Mountain freshness of chocolate Milka).

However, in practice, when it comes to choosing products, the consumer is likely identify theme based copycats as more attractive, than feature based copycats, due to general good unidentifiable feeling produced originated from the original product, while not being able to point out the source of that good feeling (due to probable confusion).

Now, theory to the side, how is it relevant for business? Well, everybody says “don’t invent the wheel”, and most of us don’t. This to say, that while we are all creative, we all copy someone’s ideas to a certain extent. This is just a business reality! Good ideas are being picked up and explored all the time. Everyone does it, but my point is to know how to do it “right”.

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Reference list:
Horen, F. v. (2010) “Breaking the mould on copycats: what makes product imitation strategies successful?” CentER Distribution Series: Tilburg.
Zaichkowsky, J.L. (2006) “The psychology behind trademark infringement and counterfeiting”. New Jersey: Lawrence Erlbaum Associates, Inc.
Sayman, S., Hoch, S.J., and Raju, J.S. (2002) “Positioning of the store brands.” Marketing Science, 21 (4), 378-397.
Scott-Mortan, F., and Zettelmeyer, F. (2004) “The strategic positioning of the brand in retailer-manufacturer negotiations.” Review of Industrial Organization, 24 (2), 161-194.