I have been inspired to write this article by two very recent market developments in The Netherlands. The first one is that recently the Dutch social network Hyves announced the opening of their own online app store where they will offer both online and mobile apps. The app store will be supported by a payment system, so Hyves can sell paid applications as well. In many respects, they follow the great success Apple had with their iPhone App Store. And I can’t see why they would fail.
The second one is that Nu.nl, the biggest Dutch news website, unofficially (at a conference) announced the launch of their own mobile app store in their very succesful iPhone app (around 80% of Dutch iPhone users has got Nu.nl installed). It will operate as a store but in fact it will suggest iPhone apps from the App Store. The added value lies in the selection Nu.nl makes for its users. Nu.nl will obviously receive an affiliate fee on the apps being bought by users redirected from their store.
It’s easy to digest from these two developments, that the app store model is now both copied in an online model and in a mobile affiliate model. In fact, you could see Nu.nl as an Apple App Store ‘user’ that starts to suggest applications to its loyal visitors. Nu.nl knows its customers a lot better than Apple knows the App Store customers so can offer its customers a tailored offering based on this knowledge. Now it’s also easy to copy this to the situation Hyves is creating. Hyves’ users can suggest their favourite online and mobile apps to their friends. But why would everyone all the sudden start recommending apps to each other? Because Hyves will pay out an affiliate fee for every app sold through your profile page!
I firmly believe this model is a very interesting business model for both mobile media and social media. If you look at the strong growth of the mobile app market, you can already spot the need for some sort of filter. In just one year’s time the Apple App Store has become very hard to oversee, about six months ago it was still reasonably easy to choose what apps you wanted but now it’s just too much. If popular and highly used apps such as Nu.nl start suggesting apps I might like, this would be of great help. And I can’t see why popular apps such as Spotify or LinkedIn wouldn’t start suggesting apps based on its user’s data and preferences. The smart thing is that these aren’t just filters, they’re revenue streams because of the generated affiliate fees.
When it comes to Facebook, MySpace, maybe even Twitter, you could do the exact same thing. You could start suggesting certain applications to your friends in a controlled and not too intrusive way so people can slowly get used to the idea of affiliate marketing on social networks. I don’t think things will get out of hand soon, the social element of social networks will prevent people from overloading their profile with all sorts of applications. Just like in a shop, people will make sure their profile looks nice, tidy, tailored to its audience and not too obtrusive.
That’s all, want more like this?
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Peter Evers is currently employed as Business Development Manager at yoMedia, where he is responsible for conceptualizing mobile applications and sales. He has extensive experience in the mobile advertising market, having worked at the mobile advertising department of leading Dutch ad network WebAds, as well as having led on mobile sales at the leading UK ad network Unanimis. |
Tags: affiliate marketing, App Store, Apple, business models, Facebook, Hyves, Nu.nl, social media
This would mean individual users being paid by, for instance, Hyves. That would take the affiliate model to a whole different level, where its the site owners that get paid in the current model.
Or am I missing something here?
Not entirely sure what you mean by site owners. Technically you own your own profile ’site’ so you get paid, but this is obviously just a slice from a much bigger cake.
In the Hyves example you could sell an app for 1 euro, of which 70 cent goes to the developer, 25 cent to Hyves and 5 cent to the profile owner because it’s sold through his/her account. These percentages are used in iTunes affiliate sales so could be seen as some sort of standard.