Do you think your company could successfully launch a product exclusively with an iPhone application? No television, no print, no radio. Volkswagen of American has given it a try. In October of 2009, Volkswagen launched an iPhone game application free to iPhone and iPod touch users.  The application features the new 2010 GTI model in a simulated racing game, allowing users to tweet to other players in real time. The application also allows the users to browse through a digital showroom, exploring all aspects of the 2010 GTI automobile.

You may be wondering what the draw is to a marketing plan like this.  For the consumers, it’s a win-win situation.  The application is free, fun and enters each phone owner into a contest to win a limited edition GTI from Volkswagen each time he / she plays. But the real winner here may be Volkswagen.  In a recent article outlining the launch, Advertising Age reported that in 2006 Volkswagen spent $60 million on a “traditional” advertising campaign for the GTI’s introduction.  Estimated annual costs for the new mobile services are only reaching about $500,000.  Even more staggering are the differences in potential buyer outreach that both means have.  Advertising Age said, “Apple reports that they have more than 50 million iPhone and iTouch users worldwide”. This is nearly double what an average network spot sees in viewership, even a 30-second commercial spot can cost up to $150,000.

While the low cost probably has the Volkswagen folks smiling, they should also be happy about the immeasurable benefits of the PR buzz this campaign has created. Being the first to think creatively always gets noticed whether it is good (as this one appears to be) or bad. Take, for instance, the recent energy drink mobile application which completely demeaned women down to mere categories in a man’s iPhone. While most would completely agree this was flop (and tasteless) the negative press that was generated still got the company name at the forefront of consumers’ minds. As the saying goes, “There is no such thing as bad press.” Perhaps not the best marketing strategy to go by, but sometimes it is worth the risk to be different. Creativity (in good taste) is certainly encouraged.

This cost effective one-channel advertising could become a revolutionizing marketing tool, when executed properly. Volkswagen believes this new campaign will be effective because they are directly targeting the consumers they are hoping to reach — tech-savvy and youthful.

An area that may often go overlooked with this idea is the possibility of a re-launch in the event that the results don’t quite match up with the expectations or supplemental advertising later in the campaign life cycle. While having to “relaunch” a second marketing campaign because the first was not successful is never an ideal situation, Volkswagen does have one advantage if the iPhone marketing is a bust – money. The budget is so much smaller than previous campaigns that Volkswagen might find it less painful to allocate funds for a second (or extended) go.

What do you think?  Leave us your comments on whether or not you think one-channel mobile marketing campaigns will be a successful technique in the near future.

Agencies and clients alike have been quick to jump on the “app wave,” accurately forecasting how apps can serve as a fresh medium to target and reach consumers. However, with the glut of apps available (ranging from the frivolous “Toss the Sheep a Pie!” application to the useful gas station locator) clients and agencies have been posed with the following question: Should branded applications serve as toys or as tools?

Tom Martin at Advertising Age believes the latter, stating, “I don’t buy the tool, I buy the solution the tool delivers. And that is the power of tool apps. You can build apps that virtually solve a consumer challenge while politely linking your client’s brand to that solution. In fact, built correctly, you can actually charge people to buy a tool app.”

In a nutshell, Martin believes that branded toy apps, while novel and fun, are simply diversions that do not necessarily convert or reinforce loyalty to the brand. And while he makes a good point, it is hardly a black and white issue.

Successfully combining the toy and tool aspect of an app could unlock a new consumer appreciation for a brand. For example, a car manufacturer could incorporate service reminders, coupons and dealership locations into a racing game featuring the flagship car into its applications. Not only would this provide a link between utility and the brand image, but it also associates entertainment and desirability to the brand’s product.

However, as a few commentators to Tom Martin’s blog pointed out, does a sugary kid’s cereal really need a tool app for its branding? ‘Coco Berry Crisp’ could greatly benefit from whimsical toy apps that reflect its branding as well as provide an incentive (i.e. complete the Coco Berry Crisp maze and receive a $1.00 off coupon). Point and case: not all branding neatly fits into the ‘tool app’ box, nor should they.

Generating a lasting brand image, as well as creating and maintaining a loyal consumer should be what an application strives to achieve. The means used to get there relies on an understanding of the product and the consumer. Whether it is a toy app for a summer blockbuster or a tool app for financial services, the result should be an interactive way for clients and agencies to express their brand in a useful and lasting way to the consumer.