Mobile is the fastest growing segment of the retail industry. According to a recent study by comScore, more than 60% of online retail occurs via mobile devices, while desktop browsing time is down by 20% from the year before. Customers expect to be able to shop seamlessly across all channels, and only one in every ten shoppers doesn’t move between devices to accomplish a shopping goal. This is the new world of cross-channel retail with mobile at its heart.
Apps are at the forefront when it comes to driving mobile conversion. According to a recent study by Internet Retailer, the growth rate of app revenue for large UK retailers such as House of Fraser, ASOS, and Asda, lies between 90% to 200%, year-on-year. Each of these companies is making above £10m through their apps.
Data from the Poq platform paints the same picture: app conversion rates are twice as high as mobile website conversion rates and they often rival desktop conversion rates. There are three main reasons for this: apps provide the best experience because they are tailored to smartphones specifically, they can be personalised by users, and the most loyal fans use them to stay connected.
Considering that the UK has the strongest adoption of mobile shopping in Europe and the US, it is surprising that only 18% of the UK’s top 500 retailers are trying to take advantage of app commerce. The retail app industry in the US is more developed: over 50% of the top 500 US retailers offer a transactional app.
When we conducted research for the IRUK2015 Mobile and Cross-Channel report, we found that UK retailers who offer transactional apps, often miss opportunities to make their app truly exciting. Whilst standard features, such as store finders, are incorporated, exciting functionality that can drive app traffic and help to bridge the gap between online and offline are often overlooked. A glance overseas to the US reveals some best-practice examples for how to deliver better app experiences.
Only two of the top 500 UK retailers offer content that changes daily or weekly. Yet relevant and regularly changing content can help to drive traffic to the app and increase engagement. A retail app that does this well is the Nordstrom app, which has seen an increase in sales by over 210% between 2013 and 2014. The home screen links to different sections dedicated to blog entries. It’s easier to read and navigate between articles on the app than it is on the mobile website, making the app a more attractive smartphone destination not only for shopping, but also for accessing content.
The next step here is to introduce app-exclusive content, which should be in line with the rest of the multi channel strategy, but tailored specifically to the app user. On the Poq platform, we see huge spikes of engagement whenever a retailer runs an app specific campaign.
Great retail apps integrate technology that makes it easier for customers to shop and pay in store. The Target app provides a great example for a retail app that makes its shoppers’ lives easier and bridges the gap between online and offline effectively. It features Apple Pay, and a sophisticated in-store map that shows users where in the store certain items can be found, and where different departments are located. One of our clients, House of Fraser, offers similar functionality. The app recognises when a user is shopping at a physical House of Fraser store location, and adjusts its menu to include in-store options like barcode scanning. Only 28% of the IRUK500 retailers’ apps offer in-store scanning.
Other useful technology integrations include geo fence notification services, and analytics software that allows for retailers to get to know their customers better.
Mobile deep linking
Deep linking makes it possible to link to specific pages within apps. A retailer that is already using this extensively is Amazon. Google product searches now often yield Amazon results that deep link directly to pages within the app, rather than the mobile site. Amazon is doing this because they get a lot higher conversion rates from the app, which now also works with fingerprint recognition to checkout.
These and other types of content improvements, technology integrations, and funnelling tweaks can help to increase traffic, engagement, and drive sales. With app commerce growth outpacing all other online growth in retail, this is the best way to futureproof your future revenue.
This article was first published in Internet Retailing.