Mobile apps have developed within the m-commerce world and have changed the way consumers and brands communicate with one another. Statista (2017) stated mobile app downloads worldwide have increased from approx. 2.52 billion in 2009 to a predicted reach of 268.69bn in 2017. The use of smartphones have become a necessity to many consumers which suggests more scope for the creation and use of mobile apps with a greater market to enter. And with so many organisations adopting the use of apps, we are going to take a specific look at the benefits of shopping apps for retail brands.
There are several benefits of implementing a shopping app for retail brands, according to Wang et al (2016) many organisations have introduced apps as a way to communicate with existing customers and increase brand loyalty. Following on, an app can be utilised by a brand to regularly update their existing consumers by using push notifications. Push notifications are considered as ‘nudging’ in modern day marketing; nudging is regularly reminding the consumer of the brand which encourages brand awareness and improved engagement. Read more here about increasing engagement through push notifications. Plus, by sending regular notifications, there is a chance to increase online sales, as the user will be the first to get exclusive offers and discounts.
Example: Push Notifications
Apps also offers the chance to increase consumer loyalty through loyalty schemes; ASOS are a brand utilising consumer loyalty schemes, as they offer points to their ‘A-List’ customers post purchase based on the amount they spent. These points build up to a cash sum and are delivered as redeemable e-vouchers, these kinds of points schemes often encourage consumers to re-purchase immediately and keep coming back to that brand. Here ASOS explain in more detail how their scheme works.
Example: ASOS Loyalty E-Vouchers
It’s also important to note how retailers can use the app to improve consumer experience, which can in turn benefit the retailer and generate good word-of-mouth from satisfied customers. Morosan and DeFranco (2016) stated that by personalising app settings for the consumer this increases the value of the app and consumer experience. Read more here about how personalisation can improve your app. Personalisation is often present in food shopping apps i.e. Sainsbury’s, where they store the individuals favourite products, this is personalised to them making their shopping experience quicker and more efficient.
Example: Personalisation
Furthermore, apps are generally more aesthetically pleasing than shopping via a mobile browser, as they have a simpler layout and a swipeable interface. Below shows a comparison of Missguided homepage via mobile browser and via the app. The app shows more options for immediate usability i.e. shop, wishlist, shopping bag, in comparison to the browser which just displays an image. And also note the app is giving the user a more exclusive discount as there is 40% off via the app, as oppose to 25% on the browser.
Example: Missguided App Homepage
Example: Missguided Mobile Browser Homepage
More benefits of having an app to the retailer include:
- The brand appears more innovative & creative
- Ease of payment i.e. storing card details
- Adds brand value
- The customer data from apps is valuable to the retailer
However, there will be some risks for retailers looking to introduce an app, firstly, within the retail sector apps are particularly competitive, so there is a concern that the app will not get the desired consumer attention. Plus, when introducing any form of new technology there will also be the risk of the ‘generation gaps’, therefore, weighing up whether the older generation consumers will take to a new retail app as oppose to their usual browsing via desktop or mobile browser. Moreover, younger consumers have high expectations of app’s therefore there is added pressure for retail apps’s to provide a seamless consumer experience, otherwise risk the app being deleted shortly after download
There are also security risks involved in app development, i.e. the risk of the app being hacked to steal consumer data. Unfortunately, according to Balebako & Cranor (2014) in app privacy is rarely stated as a criteria in app development and therefore is not a priority, suggesting the chances of app security improving will be a slow process.
More risks to the retailer include:
- Lack of innovation in the app or the ability to take-off
Overall apps have become an increased benefit to retailers to enhance their brand awareness and build a strong relationship to retain consumers, as well as increasing their online sales through regular marketing communications. Apps improve the consumer shopping experience and act as a more convenient way of browsing and purchasing on the go. However, contrary to the positives, retailers do need to be sceptical of the privacy of the consumer, therefore, if the decision is made to develop an app, there is a need to monitor app activity at all times to make sure the consumer is satisfied with the app and their privacy is protected.
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References:
Balebako, R & Cranor, L . (2014). Improving App Privacy: Nudging App Developers to Protect User Privacy . IEEE Security & Privacy,. 12 (4), p55-57.
Bhargava, T. (2016). Why 2016 Is The Year For Personalization In Retail Apps. Available: http://www.appvirality.com/blog/personalization-in-retail-apps/. Last accessed 26/02/17.
Goddard, M. (2016). How Mobile Apps Can Benefit Retail Businesses. Available: https://www.linkedin.com/pulse/how-mobile-apps-can-benefit-retail-businesses-matthew-goddard. Last accessed 24/02/17.
Kim, S.J et al . (2015). The Effects of Adopting and Using a Brand’s Mobile Application on Customers’ Subsequent Purchase Behavior. Journal of Interactive Marketing . 31 (1), p28-30.
Parker, C.J & Wang, H. (2016). Examining hedonic and utilitarian motivations for m-commerce fashion retail app engagement. Journal of Fashion Marketing and Management: An International Journal. 20 (4), p487-490.
Ratcliff, C. (2015). Seven reasons why retailers should have an app (and six why they shouldn’t). Available: https://econsultancy.com/blog/66133-seven-reasons-why-retailers-should-have-an-app-and-six-why-they-shouldn-t/. Last accessed 23/02/17.
Retail, T. (2017). RETAILERS MUST BE AWARE OF MOBILE APP SECURITY RISKS. Available: http://www.teamworkretail.com/blog/retailers-must-be-aware-of-mobile-app-security-risks/. Last accessed 22/02/17.
Statista. (2017). Number of mobile app downloads worldwide from 2009 to 2017 (in millions). Available: https://www.statista.com/statistics/266488/forecast-of-mobile-app-downloads/. Last accessed 26/02/17.