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Can mobile apps save the High Street?

Yet again, high street retailers are struggling and were on the wrong end of numerous negative headlines about how sales have dropped in recent weeks. I felt a distinctly uncomfortable sense of déjà vu reading these articles foreboding the downfall of the UK high street. The main culprit given for the doom and gloom? The rise of digital, specifically mobile. Haven’t we heard this all before?

While those who work in the “mobile” space may be forgiven for living in a digital bubble where mobile’s rule of business is well accepted, I use inverted commas for a reason. 

Today, there really is no such thing as a mobile business or a non-mobile business. It’s not that a consumer-facing retail business can’t exist in principle without mobile, it simply can’t survive. 

The signs were there several years ago. Back in the time where mobile started to penetrate both a growing share of consumers’ attention and an increased share of their wallets. Today, at the start of 2018, the competition has superseded mobile vs desktop and reached a new level of competition: mobile apps vs mobile web. There has been a fundamental shift.

Ignore apps at your perils

Globally, consumers now spend on average approximately three hours a day in apps, and seven times more time in native apps than simple mobile browsers. Failure to recognise this paradigm shift hurts many retailers. By the time they caught up to the focus on mobile web, the retailers focusing on mobile apps were light years ahead.

It’s no surprise that those retailers that have focused on an app strategy have been the ones to thrive in recent times. For example, Asos has reason to celebrate the new year, sharing a 23 per cent year-on-year increase in what the company admitted was a “challenging” UK market.

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In the same period the previous year, UK revenues had risen 18 per cent. It’s no coincidence that Asos also features as the third most used digital-first retail app in 2017. The competition between bricks and clicks versus digital-first could just as accurately be described as “the brands that embraced mobile first versus the brands that tagged it onto their retail strategy later on”. 

Smartphones are now displacing desktop PC in online transactions

Developing an app strategy is not just a smart way to retain your piece of the retail market pie, it makes the pie bigger. The potential revenue to be gained in the app economy is a phenomenal size of the market.

For example, in 2017 consumer spend in the app stores exceeded 86 billion USD – an increase of over 105% from 2015. Within three years, total spend in mcommerce, in-app advertising and app store is forecast to reach a staggering 6.3 trillion USD – more than twice the UK’s annual GDP.   

The sad reality is that retailers are continuing to overlook the opportunity for growth afforded by the consumer shift to mobile. It’s not that the revenue isn’t there if they look for it.

Despite shoppers reportedly shunning the high street over the festive period, overall spending still reportedly increased year on year according to a report by Visa. In fact, November 2017 was the biggest month ever for mobile shopping according to the same report. 

One advantage that retailers have is that they’re entering a market with a proven appetite. For example, here in the UK, 2017 saw an 80% increase in total sessions in retail apps.

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Last year also saw some 100 million hours being spent in shopping apps on Android phones and tablets in the US during the week of Black Friday and Cyber Monday in November. 

Developing an app strategy is not just a smart way to retain your piece of the retail market pie, it makes the pie bigger.

Good bye to brick and mortar?

The physical retail store was once the place where individuals interacted with your brand, but since the boom of e-commerce, mobile has become the primary point of contact.

Not only is mobile the best opportunity to reach your audience, it’s the best opportunity to create a truly personalised experience for your customers and nurture your customer relationship.

Apps are far more than just another platform; they’re an opportunity to improve your relationship with customers and, ultimately, your bottom line. The most successful retailers in mobile have recognised that mobile isn’t a subset of digital, it’s the glue that brings together the digital and physical store experience.

Use of in-store beacons, apps that provide product data and product locators drive customer engagement and loyalty. It’s particularly worth considering that orders placed in apps and collected in store represent increased margins in a tight market. 

Retailers can discover a plethora of personal preferences from their customers by simply analysing how they spend time in their apps – from their preferred store locations and their wish lists to their favourite time to browse and more.

Apps can provide a window into a consumer’s life; how you can use this data to make the customer’s experience slick and powerful is almost bottomless.  

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Let’s consider a fashion retailer. Imagine your customer has not bought anything from you before but has been browsing hats. On the mobile web, tracking this can be tough, but acting on it even harder.

With an app? If one of those items subsequently goes on sale, the retailer can send a notification (either OS-wide or within the app itself), helping turn a prospect into a customer.  

Apps can function as the bridge between offline and online, encouraging users in-store at a point when it’s of most value to them. 

For example, if a customer has items in their wish list or even sitting in their online shopping basket, and one or more of those items is on sale in a nearby store, retailers have an opportunity to send push notifications through the app.   

With such a rich platform to embrace, the fight for retailers to win the high street is not over; in fact, it’s only just begun.

Competition has never been more fierce, those retailers that manage to use mobile apps to drive value both online and offline, the potential to accelerate business is phenomenal. However, be warned. If app strategy is an afterthought in your sales strategy, then your brand will remain just that for UK shoppers.

  • Paul Barnes, Territory Director Northern Europe and Middle East at App Annie
  • Image Credit: Bruce Mars / Pexels 


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