Brick-and-mortar retailer apps need a boost

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BI Intelligence

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US consumers are spending approximately 50 minutes in shopping apps each month, adding up to 10 hours a year, according to a report from App Annie as cited by TechCrunch.

This large amount of time spent in apps helps explain why mobile commerce is set to account for nearly half of all e-commerce by 2021, and makes a quality mobile experience a must-have for all retailers.

Digital-first apps are performing better than apps of brick-and-mortar retailers. Apps from digital-first retailers like Amazon and Etsy saw their number of active monthly sessions grow 25% year-over-year (YoY) in H1 2017, while apps from brick-and-mortar retailers only saw 15% YoY growth. Moreover, digital-first apps get seven more sessions per month, on average, for each user than brick-and-mortar apps, affording them a bigger portion of an average user’s 50 monthly minutes. That difference can likely be attributed to the digital expertise these companies have from building out their native e-commerce platforms.

Brick-and-mortar retailers must improve their apps for both online and in-store use to capture more mobile shoppers. Retailers that have not invested in their apps may have a slow and frustrating user experience that pushes consumers away. If they want succeed on mobile, they will have to fix these issues first, as 50% of users will give up after five seconds. App Annie also found that consumers often use brick-and-mortar apps while in stores, so retailers should work to make the experience worth their while by integrating their apps into the shopping experience with exclusive deals and other utilities. This has worked for retailers before — Target’s Cartwheel, which is being rolled into Target’s main app, boasts exclusive deals and is one of the most used brick-and-mortar apps, according to the study.

Retailers like Starbucks and Dunkin’ Donuts are winning over consumers with their mobile wallets — apps developed by stores to make it easier for their customers to pay, and to deliver valuable perks.

And these retailer wallets are leading the overall mobile wallets industry, thanks to their ability to rapidly push out innovative features like rewards programs, coupons, mobile order-ahead, and custom marketing.

This may be surprising considering that retailer mobile wallets can be used only at a specific retailer’s locations; in contrast, popular universal mobile wallets like Apple Pay and Samsung Pay can be used at multiple retailers, as long as users are using the necessary smartphones.

Ayoub Aouad, research analyst for BI Intelligence, Business Insider’s premium research service, has compiled a detailed report on retailer mobile wallets that:

Explains what hurdles universal mobile wallets have faced.
Details what features retailers have adopted into their mobile wallets that have been successful
Analyzes the use cases of retailers that have successfully leveraged their mobile wallet offerings to push growth.
Identifies how universal mobile wallets will eventually slow growth for retailer-based mobile wallets.

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