Well, no one would pick the former choice because it's essentially an actual customer base versus stray eyeballs.
But keep in mind that web apps and advertisements are different beasts when it comes to frequency versus reach. For a web app, site, or service - of course you're going to want frequency. When it comes to advertising, the prevailing choice isn't as distinct. I'd contend that reach would have a greater chance of finding potential customers. Frequency can be seen as a nagging effect on deaf ears and blind eyes (the uninterested).
Reach with frequency has a good opportunity to find new customers, but the lower the frequency, the less the effect. This is where many companies fail in their lead generation campaigns - they look at the campaign as a single event.
But keep in mind that web apps and advertisements are different beasts when it comes to frequency versus reach. For a web app, site, or service - of course you're going to want frequency. When it comes to advertising, the prevailing choice isn't as distinct. I'd contend that reach would have a greater chance of finding potential customers. Frequency can be seen as a nagging effect on deaf ears and blind eyes (the uninterested).