Developers working on iOS applications have had a bit of a dilemma regarding app demos and beta testing. Getting a prerelease or ad-hoc version of an app out to testers' devices can be complicated, expensive or both -- although services like Testflight and Hockeyapp can streamline the process if needed.
For marketing, many devs have used a short video to try to get across the key points of an app, while others use the freemium model to let users give the app a try before purchasing full functionality through an in-app purchase. They could also choose to not create a demo and use word of mouth and a good website to explain their app.