E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
Find reasons to keep app users coming back.
A couple of weeks ago I wrote a blog post about why I believe smartphone owners prefer to use mobile sites rather than apps in most cases. My argument was that unless a consumer uses an app on a regular basis, (for example to check their bank account or the weather) most would rather just visit a mobile site to complete a task than download and house an app. Since I presume most smartphone owners don’t purchase from the same mobile retailer several times a week, I think it’s best for retailers to start with an m-commerce site.
However, Apple proved again this week there’s still a massive appetite for apps. Apple announced Saturday that more than 10 billion apps have been downloaded from the Apple App Store by the more than 160 million iPhone , iPod Touch and iPad users worldwide. That’s an average of 62.5 apps per device. The App Store launched in 2008
The 10 billionth app downloaded, Paper Glider, was purchased by Gail Davis of Orpington, Kent, UK. To celebrate the milestone, Davis will receive a $10,000 iTunes gift card.(Paper Glider, by the way, is a game where you virtually fly a paper plane through a room attempting to get it out of a window without hitting a series of ceiling fans. It is rated three out of five stars by app users).
Apple now offers 350,000 apps for the iPhone, iPod Touch and iPad and more than 60,000 native iPad apps are now available.
I don’t know about you, but 62.5 apps per device seems like a lot to me. It makes me wonder how many apps are downloaded for a specific reason and then deleted? A hotel or resort for example, may offer an app that an individual would use only during her stay, and apps with cult followings like The Bed Intruder will only be hilarious for so long.
What matters most for e-retailers is whether or not it’s in their best interest to create an app for Apple’s mobile devices. In short, will consumers download and use an app to shop? There’s a slew of apps on the market that aren’t e-commerce-related from news, to games to bubble levels, that are all jumbled in with this number and can confuse the bottom line for merchants.
The study I cited in my previous post found that a full two-thirds of 1,200 mobile phone owners surveyed say they prefer the mobile web over downloadable mobile apps for shopping. Still, I think there’s a massive opportunity for m-commerce in the app world if retailers approach it right.
My hypothesis is that apps earn a permanent spot on a smartphone when they offer fresh content a consumer wants to access daily. So m-commerce apps should include elements that will keep consumers coming back. Retailers could offer one steep discount each day only available to app users or a sweepstakes solely for app customers. Perhaps retailer could give app users first dibs on new goods? Retailers including Sephora have gone in this direction, offering a free gift for shoppers who download their app. That will help, but it won’t keep that app on a consumer’s smartphone (and on the top of her mind) for long. The winning strategy is to continually give shoppers a reason to open that app nearly each and every day.
Apple’s Q1 earnings report released last week reports that the company sold 16.24 million iPhones in the quarter, up 86% from the same period a year earlier. IPhones aren’t going away—they are nearly doubling each year. Apple apps have reached the 10 billion download mark. The case for a retail app is there. Now all retailers need is a strategy to keep shoppers engaged with it. I wonder, is there an app for that?