I use Img2icns to create or replace my own custom icons for folders/documents/applications. The images you see on the dock are just shortcuts of the actual application. So you gotta go into your application folder and replace the icon there, then drag its shortcut to your dock.
Since the folder "applications" is a folder, you just right click it like any other thing in osx, and use Img2icon or some other program that can make icon images, and then it should replace the icon on the dock automatically.