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The iPhone's App Store has made a lot of people a good deal of money during its short existence. But can a new car launch on the iPhone alone? Volkswagen is betting it can. The automaker is launching an app to announce its newest vehicle.

The car maker is betting that the highly targeted app will reach the caliber of customers interested in purchasing the vehicle.

AdAge calculates that the new app will reach more of that demographic than a much costlier television purchase. But does the math add up?

The cost of Volkswagen's current campaign is estimated cost around $500,000. In comparison, when the company launched the 2006 GTI, it spent $60 million on a campaign that focused attention on large television buys. Clearly an iPhone app is producing cost-savings for the brand. But will it be effective?

The iPhone is a great place to reach tech savvy customers who are willing to part with money for a good product. As AdAge points out, there are more than 50 million iPhone and iPod touch customers. The most popular television show last week — CBS' "NCIS" — would cost $300,000 for a 30-second ad and only reach 21 million viewers.

But there's no way that all iPhone users will download the app. And is there proof that people who like racing games are in the market for cars? It's not likely. But Volkswagen is hoping that the well produced game will dovetail with the attributes of their new car, and help create a positive impression of the brand.

The iPhone app, created with digital agency AKQA, is a free car-racing game that puts players on a fictional beach racetrack. It also includes a virtual Volkswagen showroom, and registered players are eligible to win one of six limited-edition GTIs. Firement, which helped created this branded race course, normally sells its app Real Racing for $6.99 on the iPhone.

To drive users to download the app, Volkswagen is using PR, some paid search and hoping that social media ploys will help it go viral. The game includes allows players to send messages via Twitter and upload game play-videos to YouTube.

Offering users the incentive of a free game that many people have been willing to pay for to date will certainly help with adoption, but it is likely that Volkswagen is cutting off a large chunk of its demographic by focusing on the iPhone.

The first comment on AdAge's story gets to a part of the problem:

"Well, good thing I read about the GTI launch here. Based on this strategy, I'd have never known they were coming out with something new. Cost saavy (sic), sure. PR saavy, sure. Marketing saavy, not so sure."

While this effort is never going to reach the entire base of iPhone users, it could be a good launchpad for the new GTI — paired with some traditional marketing efforts to get the word out to the non-iPhone owning set. And with all the money Volkswagen saved on this campaign versus 2006, they should have some cash leftover for those efforts.

Meghan Keane

Published 23 October, 2009 by Meghan Keane

Based in New York, Meghan Keane is US Editor of Econsultancy. You can follow her on Twitter: @keanesian.

721 more posts from this author

Comments (4)

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Veiko herne

What an expensive budget to create a game? Usually professionally developed mobile games by software companies are charging or the development budget is around $25-$65K. Freelancers do it for $700-$6K, usually something $2K,$2.5K.

almost 7 years ago

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Promotional Products

I have to applaud them for taking a risk like this. I'm assuming that this is the first wave of their campaign; if this works they can milk this cow a little more, and if it fails then they can move into a more traditional campaign.

almost 7 years ago

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balint@vzaar

Not to mention that the mentioned the number of iPhones and iPod Touches (500 Million) seems to be incorrect. A quick google search revealed that the realistic number is much closer to 50 Million, give or take.

almost 7 years ago

Meghan Keane

Meghan Keane, US Editor at Econsultancy

balint, I've fixed that errant zero, it is 50 million users. The $500,000 is just an estimate that an AdAge source gave. Volkswagen has not divulged that info.

almost 7 years ago

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