Or do you?
SOURCE: The full download, NZ Post, 2020 NZ
Every retailer and his dog are juggling the decisions around digital commerce, the changing behaviour of customers and investing in their business carefully. Mobile apps are essential for larger online and brick-and-mortar brands alike. We see the success of transactional business growth through the likes of UberEats and the Starbuck’s app. Retailers like Nike have used mobile apps to merge mobile and in-store experience, including reserving sizes in-store, tapping into rewards and getting help from in-store staffers.
But does every retailers actually need an app?
According to an Emarsys survey, about 70 percent of people who download an app abandon it after only one use. With between 2,000 to 2,500 mobile apps downloaded each day, some 90 percent of users don’t stay with the app for more than seven days. Getting consumers to download an app is less of a challenge than getting them to stick around and use it regularly and often.
A recent Deloitte mobile survey found that 83% of people interact with their smartphone within the first 60 minutes of their day. For retailers, the question isn’t whether to focus on mobile, it’s how.
There are a few different camps. I have some retailers talking to me how apps are going to dominate how customers interact with them, and other retailers thinking of mobile apps as “nice to have.” And it’s true that shoppers are moving faster than ever before, hopping from device to device, buying wherever they are. But what they are buying? How they are buying? And how many apps is a customer willing to have?
SOURCE: The full download, NZ Post, 2020 NZ
Ideally, we are working from a baseline where you as a retailer already have a mobile website (some of you don’t), so why invest in a mobile app?
1. Apps can do what websites can’t
Native apps provide the fastest, most reliable experience to users. Compared to mobile web, apps are far more responsive and have far fewer connectivity issues. Mobile apps offer retailers a new way to relate to customers and to provide both more convenient and more personalised shopping experiences.
Additionally, a native app enables you to send promotional push messages and in-app rich messages. Push messages are a hugely effective marketing channel for brands. With open rates far higher than email, they’re direct, timely, and reach your customer wherever they are. Apps can also incorporate smartphone features such as GPS, Bluetooth, address book and the camera for product and credit card scanning. Native apps also benefit from inclusion in App Stores, where they can be discovered by new customers.
2. Apps cater to the cross-channel customer
Covid certainly accelerated it, but more consumers now want to be able to shop using multiple channels. It’s not a face-off between bricks-and-mortar and online, it’s become a matter of merging digital and in-store into a seamless retail experience - one that engages shoppers at home, on the move and in-store.
Online and offline will continue to blur further and we will see an acceleration of more retailers adopting a “cross-channel” approach. Retailers that enable customers to move easily between different channels are going to lead cross-channel commerce. It’s now widely accepted that customers spend much more when brands sell through a variety of well-connected channels. Figures show that shoppers who buy from the company over mobile, in store and online spend more than five times as much as those who only buy from the desktop site alone. Part of that necessary evolution is to consider the creation of a native mobile app.
3. Increase conversion & window shopping.
Mobile apps may not achieve as much revenue as mobile or desktop websites, but brands should not discount the window shopping (or “showrooming”) function of mobile apps. According to an ABI Research survey, 40.4% of respondents who had downloaded a retailer branded app said that as a result, they bought more of the brand’s products and services and 45.9% said the app caused them to visit the store more often. According to Walmart, customers who use its app spend 40% more than customers that don’t.
4. Increase customer loyalty
As a loyalty tool, an app installed on a phone is a great way of keeping in touch with customers and allowing them to sign up for deals. I have a teenage daughter and I can’t tell you how much more we spend on beauty with the Sephora app. We also never miss out on whatever Countdown thinks will meet my needs this week. Push messaging gives retailers the power to connect directly and personally with their customers. Unlike emails, push messages appear right on a smartphone’s lock screen and the recipient must act on each message (either by tapping to open it or tapping to dismiss it). This means it is easier for them to be driven directly to your app. By offering engaging features beyond simple product listings and purchasing ability, such as style recommendations, how-to videos and exclusive offers, you will be able to keep your customers coming back.
Having a mobile app allows you to not only engage your customers, but you can personalise the conversation and track and understand their behaviour to improve your relationship with them.
5. Improve in-store experience
Mobile apps offer incredible opportunities to connect with your customers while they are physically in your stores. The possibilities are endless once we grapple with the privacy and creepiness concerns, but you can use technology to welcome this customer to your store, and if they have an item in their wish list, you could notify the customer if that item is available in their size. I’ve seen great examples of “in-store mode” with queue-busting technology including in-store checkout, barcode scanning, mobile receipts, maps and stock availability.
But do YOU need an app?
A recent Australian research study by Power Retail found the number of retailer apps that shoppers have on their phone remains relatively unchanged since 2019. While the number of retailers who have apps has increased over time, this doesn’t necessarily translate into an increase in the number of apps that consumers download, plateauing at around five. This means that app real-estate is extremely competitive.
Hootsuite's latest 2021 study is telling of what apps Kiwi's are using by category.
Much like apps are a vital part of major retailers' marketing strategy by remaining a key channel for reaching consumers, they can be a useful tool for acquiring and building relationships with customers.
A Braintree report found that 58% of shoppers browse e-commerce apps or websites on their mobile phones, and at least 38% are doing so at least once a week. But small retailers shouldn't make an app solely to fit in with their small or larger competitors.
Who are your customers and what are their behaviours? For example a baby care business we know from Australia said “Younger, "tech-savvy" customers, for example, tend to shop on the app, but grandmothers and other mature customers, as well as younger moms browsing during their downtime, made purchases via the website.””
Whether an app is worth the investment for a small retailer depends on who you ask. Before developing an app, small retailers should first ask why they need one, because an app may not be right for every retailer or small business.
Retailers should ask themselves whether the app will drive sales, function as part of their branding or engage with customers. Understanding the fundamental purpose of an app can prevent retailers from adding too many features.
Depending on the size of your business, addition to the costs to set up the app, you may have to pay a developer a monthly fee to manage the app as well as fees to maintain it in Apple's App Store and Google Play.
Retailers should also consider how their apps will integrate with their existing technologies, including their point-of-sale system, warehouse facility or DC. Will you be providing an integrated seamless experience, or will you be creating a mess you cannot manage.
I have many apps on my phone which I have concluded simply make my life easier. I am a fusion shopper (read other article in this newsletter) and spend. I don’t have headspace for apps I don’t use daily or at worst weekly. They get scrapped. BPMe, Countdown, local coffee shop, NZ Herald, Banking apps, Ola/Uber, UberEats, Laybuy, AfterPay, TradeMe, AT Parking, Bakers Delight, Westfield+, School Apps, Waze, Rova, Covid tracker, Fitness trackers, Netflix.
My daughter: Zara, Sephora, College Sports, Depop, TV streaming and then games and social media platforms.
This says a lot about behaviour. What we are interested in and what makes our lives tick.
Check out the article APPsolutely fabulous where we cover the latest in apps and the fight to get on the phone.
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REFERENCES
The full download, NZ Post, 2020 NZ
10 reasons retailers need an app, NN4M, 2020, UK
Are apps right for small retailers, RetailDive, Aug 2019