Digital Marketing and a Free iPhone Part 2
In this article we will examine some more ways in which Apple could financially justify distributing free, ad-supported iPhones, to an eager public.
If purchased directly from Apple or AT&T, the new iPhone
4 costs $199 for the sixteen gigabyte version, and $299 for the thirty two
gigabyte.With this purchase comes a commitment to a monthly service fee for
accessing the telephony and data capabilities of the device.These data plans
are not required to reach the Apple App store (access to the app store can be
made through the iPhones built in Wi-Fi capability), which currently holds over
200,000 apps, many of them coming at no charge.These free apps are made
economically possible due to the fact that they are ad supported, meaning that
the app is free, but advertisements sporadically appear on the screen while the
app is being used.For music based apps, these ads are delivered in the form of
commercials that play after a few songs have been heard.For the app setting,
free delivery has proven to be an effective way of getting the app in the hands
of users at no cost, while still allowing a revenue stream to flow into the
pockets of the developers.In examining this successful and proven methodology,
one wonders if the same practice could be applied to the iPhone hardware.Certainly,
Internet Marketing experts would have no shortage of methods for delivering
content to these types of customers.In this article we will examine some ways
in which Apple could financially justify distributing free, ad supported
iPhones to an eager public.Text Messages At the end of our first installment,
we touched briefly on the ability for Apple to make text messaging a part of
their revenue gathering methods for this ad supported iPhone.In considering
text messages, they would have to be heavily ad supported.In order to both
write and read a text message, users would first have to either read or view an
advertisement.These ads would be best served remaining consistent in length.Being
subjected to a quick 5 second video ad before sending or receiving a text may
get tiresome if the user texts very often, but the hope is that the iPhone
experience will be strong enough that in the case of the user tiring of the
ads, they would convert to an actual purchase of the hardware. More Access to
Usage Habits: Another aspect of this ad supported iPhone would be user agreeing
to allow their usage to be monitored, so more targeted ads could be delivered
to them.Downloaded apps, keywords in texts and emails and visited websites
could be culled for information that would result in more relevant ad delivery.While
most users might reject such usage monitoring, many would happily trade that
bit of privacy in exchange for a free iPhone. Other revenue streams This type
of ad supported iPhone could also offer up entirely new types of revenue
streams by introducing one time fees for goods or services that come for free
with an iPhone purchase.For example, the iPhone 4 currently ships with a free
pair of headphones, a wall charger and a charger cable.The headphones could
become a paid item, as could the other accessories.Going a bit deeper, we can
examine the pre-loaded software that comes with the iPhone.Free apps such as
Camera, Safari and the various utilities could remain free, but others could
come with conditional charges.For example, the Contacts app could be initially
free, but adding over 50 contacts could come with a one-time charge of five
dollars. Search Engine Marketing could be amped up on this free iPhone, as the
user could be subjected to a larger amount of ads than the typical user when
performing a search.The iPhone could also be delivered with certain features
shut off, giving the user the ability to activate them for a fee.Lets say the
user is given the ad-supported iPhone, but it lacks the motion sensing
abilities of the typical iPhone.The user could then be motivated to pay to
unlock features.These types of charges would have to remain few and far
between, however, in order to keep the value of the free iPhone from becoming
redundant through all the secondary purchases.Users could even be given the
option of purchasing ad free blocks.In this situation the user could pay a fee
in order to guarantee an ad free experience for a certain amount of time.
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