Retailers shift their ad spending from TV, radio and print ads to digital ads.
(Page 2 of 3)
Prepare to pay
Whatever the purpose of an app, cost can be an issue. Yankovich will not reveal what it costs eBay to build an app, but he says for eBay, a large company with a lot of required features and functions, it's not inexpensive.
"It varies, but the notion you can build an iPhone app for $6,000 to $12,000 is just silly," he contends. "It's one thing to build a few screens and a few user interface elements and some logic. It's quite another to have it talk to the server side and be transactional and support millions of users, many simultaneously. It is not bargain basement cheap to build an app."
Many mobile experts disagree, saying basic apps that are used more for branding and marketing than selling can indeed be built for around $10,000—on the high end, though, an app can cost $100,000 and beyond.
EBay's development costs are likely to be higher than average because it takes steps that some retailers skip to ensure the apps will please consumers. "Focus groups in different cities, engaging user interface and user experience experts to get six or eight riffs on an issue," Yankovich says. "You can do a lot of design and research compared to some random app in the App Store."
EBay has a team of "many dozens" dedicated to mobile commerce that does a lot of that design and research in-house. At the same time, it has hired a variety of technology providers, including Critical Path Software, to help build the site and apps.
"I like the diversity of experience we get when we use external developers," Yankovich says. "No one has blinders on with respect to what the experience should be like. They do different products. The other thing is it allows us to have extra capability to build an app or modify an app that wasn't planned. That's important for the dynamic nature of the mobile space right now. And that is hardest to do financially and operationally with just in-house employees. We accomplish that in a more cost-effective and tactically more effective way using third-party partners."
One team, two groups
As for the in-house mobile team, it's divided into two groups: product management is one, development and engineering the other.
The product management group coordinates interaction with other departments, soliciting input from everyone on the mobile team as well as hundreds of colleagues throughout the numerous departments at the company. It figures out what an app should do and which features and functions should be included.
Development and engineering builds the apps per specifications from Yankovich and the product management group. This group also is responsible for quality assurance, which Yankovich doesn't take lightly. "These are folks who must constantly be thinking about how to test m-commerce and the quality around mobile," he says.
Having a team dedicated to mobile is crucial to success, he adds, because it enables any other team within the company to go mobile in a more effective manner.
"There's an efficiency of having a set of resources devoted to not only the technology but also to the processes of how you do mobile; there's a lot of learning there, it would not be as efficient for everyone who needs a mobile footprint to work things out on their own," he says. "So anybody who needs a mobile footprint, it will come through us, since we have the expertise and the processes to do it the right way."
EBay added to its mobile expertise in June when it acquired the popular mobile comparison shopping app RedLaser, a deal that furthers eBay's aim of removing "friction points" in mobile shopping processes. RedLaser enables smartphone owners to use their built-in cameras to read bar codes and receive product details, prices and other information from across the web.
"One of the design goals for us is to reduce friction so you don't ever lose focus on engaging with us," Yankovich says. "A lot of times people are doing comparison shopping via mobile and are in a bricks-and-mortar store. Which is easier to do: type in the whole name of a product or scan the bar code? Use the technology that's in your hand, in this case the camera, on a piece of information that is sitting there, the bar code, to quickly, completely and accurately describe the product you are looking at."
EBay also launched a basic form of augmented reality technology in its new Fashion app, which, among other things, enables customers to place clothing on photos of themselves to see how they would look. The company is keeping its eye on more advanced augmented reality, as well as other up-and-coming technologies that may offer opportunities, such as image recognition to enable easier product searches.
When it comes to finding opportunities, eBay has nailed one in m-commerce. With its large team of m-commerce pros dedicated to building unique and more advanced mobile apps while maintaining an optimized site for one and all, eBay is likely to continue to be an m-commerce leader in the years ahead—and set the bar high for retailers, big and small.
Making mobile checkout fast and easy
Retailers in m-commerce today know that when it comes to converting a mobile shopper into a customer, checkout can be a big hurdle. Mobile consumers don't want to type in their payment information along with their billing and shipping addresses; they're on the go and want to finish their shopping quickly and easily.
That's why so many retailers in m-commerce are enabling mobile shoppers to connect to their e-commerce accounts with a name and a password, allowing them to use stored information to complete a purchase in just a few swipes of the screen. EBay Inc. is taking a similar avenue via its PayPal unit.