This article critiques the effectiveness of mobile apps as a marketing tool for local businesses, particularly restaurants and retailers.
Mobile App Market Dominance
Nielsen data shows that the top 8 smartphone apps are controlled by Facebook and Google, with Instagram (at #9) having 74 million users. The analysis reveals that “smartphone users in general aren’t downloading new apps,” making it difficult for businesses to gain traction.
Two App Types Analyzed
Custom Loyalty Apps
Require significant development investment and face the barrier that customers won’t download them since people avoid adding new applications.
Shared Loyalty Apps
Pool multiple businesses but create intense competition and fail to attract new customers; users check deals only after deciding to visit.
The Push Notifications Fallacy
Of 100 people, only approximately 2.25 might actually see a push notification due to download rates and notification disable settings. This channel has severe limitations.
SMS Marketing: The Better Alternative
Text messages have a 98% read rate within the first two minutes, with redemption rates reaching 12-20%. No app downloads required. Your message reaches customers directly on the most-used app on their phone—the default text messaging app.