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Do retailers really need a mobile app?

Eelco van Wijk, JMango360

Some retailers may wonder why they would need a mobile app if they already have a mobile site. What would a mobile app add? They may have forgotten that 14 years ago, that was exactly what retailers were wondering about a website, if they already had a physical store. But now, which retailer could ever imagine not having a website? In a few years, and we predict even next year, no retailer will be able to imagine not having a mobile app. That is why we believe that this is the moment for SMBs to develop their own mobile shopping app and still be slightly ahead of the herd. Those who adapt early will reap the benefits.

A one-second delay in page response can result in a 7% reduction in conversion

Apps offer great user experience

User experience is the most important factor of online purchasing, the all-encompassing factor. For example, a one-second delay in page response can result in a 7% reduction in conversion4. Native apps can work offline and are much quicker. Research from Compuware shows that customers prefer apps over mobile sites because they find them more convenient, product loading & browsing is quicker, the checkout is easier, content is more personalised, user information gets stored and they say they find better deals.

Big brands, therefore, spend a lot of time and resources on figuring out how to develop the best experience for their customers. Criteo research has shown that leading retailers with a native app see their customers return quicker and spend more5. Why should smaller retailers have to re-invent the wheel?

Apps turn customers into brand-fans

Criteo research shows that apps remain the most efficient channel for retailers, driving a larger percentage of shoppers down the purchase funnel and converting at 3x the rate of mobile web. Especially when it comes to turning first time customers into repeat customers, Apps have the highest impact due to push messages and constant branding of app icons. The user retention power is twice as high, meaning mobile app users are twice as likely to return within 30 days.

As we all know, repeat business is much easier and more profitable than trying to attract new customers; this makes user retention an important factor for any retailer. With a mobile shopping app, retailers have the best chance of retaining customers and increasing revenue. If you are a retailer with a lot of repeat purchases, your app will be your most important channel for revenue.

Retail app usage is the highest of all categories

App users are repeatedly engaged to use the app due to features that no other channel can offer

Another sign that retailers should invest in apps: app usage is increasing6. App users are repeatedly engaged to use the app due to features that no other channel can offer, like push notifications. The open-rate of push notifications is 90%; much higher than any other feature.

Statistics show us that, with no less than 17.5 sessions per month, ecommerce and retail apps were used most in 20157. The year before, the use of shopping apps increased by a whopping 174%, which was the highest of all categories in app stores. This proves to us that, once a smartphone user has downloaded an app, usage can be stimulated and retained with a good user experience and push notifications.

Key takeaway

Developing a mobile app is a great way to turn first-time shoppers into loyal advocates.

4 Source: Aberdeen's June Benchmark report, Application Performance Management  5 Source: Criteo The State of Mobile Commerce 2016 6 Source: Econsultancy Mobile app usage grows by 28%: Where are users spending their time? 7 Source: Localytics, App Stickiness Index Q4 2015