Apps: The Newest Brand Graveyard


Even Facebook application "success" stories have fleeting appeal. FedEx proudly trumpeted the viral aspect of Launch a Package -- an application for the sending of virtual gifts in FedEx packaging -- that gained 100,000 installations in three days. In all, FedEx reported, 1 million packages were sent. But many of those users didn't stick. The numbers indicate that by late September, just 4,000 people were using Launch a Package per month, according to Appdata. Now it attracts just 1,500 monthly users.

One possible reason for the big dip: People were acquired through pay-per-install ad networks, where application makers "guarantee" downloads by inviting users getting another app to add one from an advertiser.

"People are tricked," said Cunningham. "They have no idea what they're installing."

Andreas Combuechen, CEO of FedEx digital shop Atmosphere BBDO, believes the program was a success, if only in the short term. "Do we know what the magic formula is? I don't think so," he said.

Success stories seem to involve simple messaging and modest expectations. Anheuser-Busch, for instance, used a Facebook application as part of a Bud Light party cruise. The app was given to 4,600 cruise goers who could use it to see who else would be on the ship, upload photos and keep in touch afterward.

"There's a social context for the cruise that makes it fundamentally better," said Michael Lazerow, CEO of Buddy Media, the firm that created it.

For big brands needing mass reach, partnering is easier. Gap reached 7 million users in a little over a month by partnering with RockYou's Pieces of Flair during the presidential election for an app that distributes virtual campaign-style buttons. Digital shop AKQA considered building a Gap application, but decided against it, according to Scott Symonds, executive media director at AKQA.

While such media buys aren't revolutionary, they're probably the best way for brands to participate on social networks, he said. Slide, a top app company, has integrated brands like VitaminWater and Starbucks into their most popular Facebook franchises. Microsoft tried building its own "poking" application to promote Office, but an integration with Slide's FunSpace app, which has 14 million users, got the same engagement at a tenth of the cost, according to Kevin Freedman, CFO of Slide.

"You can take that same amount of money and spend it to reach the consumers who are going to use your product," he said. "Just look. It's pretty clear building [brand] applications isn't working."