Tuesday, 11 December 2012

Opinion: Does My Shop Need An App?

by Adam Kay - Founder of Loyalli

Retailers all over the UK are introducing a mobile element into to their businesses. From coffee shops to toy stores, car dealerships to hotels, everyone appears to be looking for a presence on your smartphone.

It is also becoming increasingly common for the logo representing a mobile presence to be seen in advertising alongside the instantly recognisable Twitter and Facebook icons.

But are they really necessary?

Opinions are split - in research published by RSR Research in Dec 2011, the following was uncovered as the most valuable marketing opportunities to retailers in the coming years :

1.     "Better targeting through more detailed customer preferences data" - ( 97% of respondents)

2.     "Delivering real-time personalised offers" - (97% of respondents)

3.     "Turning customers into advocates through social media" -  (94% of respondents)

App numbers at the beginning of 2012
Despite the potential benefits mobile commerce and smartphone applications offer, the RSR Research report also uncovered that only 16% have a downloadable mobile application.

However, this number is growing rapidly, is it time for you to follow suit?

Maybe, but first it is worth asking the question, what is the reason for this surge in popularity amongst retailers?

Are they all just jumping on the bandwagon, hoping that a presence in the Appstore will translate neatly into targeted and engaged customers, willing to give insightful feedback to help grow their brand or business?

Unfortunately, this is not the case. 

There are many retailers that believe that by simply publishing an app they will drive crowds of loyal and sales hungry customers through their doors, each one with an uncontrollable urge to empty their life savings into the retailer’s business account.

If you’re going to do something..... do it properly.

Of course there are those on the other side of the spectrum. Enter the now infamous Starbucks app. Despite this app being effectively a competitor to our business, it is impossible not to hold your hands up and congratulate Starbucks on an exceptionally powerful and well thought-through application. It clearly provides Starbucks with a strong return on investment (which was surely a significant amount!) and builds brand awareness through savvy marketing and neat calls-to-action. Perhaps most importantly though, it encourages repeat business. And as we at Loyalli know, there is nothing more important than repeat business!

What makes a good retailer app?

Ultimately, there are a huge number of factors to take into account, the DNA of a good application is complex. But here are what we believe are the most important factors.

Firstly, any app needs to genuinely benefit the user. Who are you making this for? Why would they delete Angry Birds for this? There are over 700 apps in Apple’s app store, in order for any app to stand-out, the user’s experience must be kept in mind at all times.

Point two, what you are trying to achieve through customers using the app? There are an almost infinite number of goals that retailers try to achieve through the launch of an app, but the holy grail has got to be: data capture. Whether you are interested in purchasing history, personal details or preference based data, for your app to generate a significant ROI it is essential meaningful data is captured. 
If you want to publish your menu and opening times, perhaps a mobile site is a better (and cheaper) option?

Finally, and perhaps most importantly, address a challenge or concern.
A successful app needs to address a challenge or concern that several users face when interacting with you, the retailer, or your industry. For example, a coffee shop should always consider a loyalty element built into their app.  Displaying prices and location data only is not something users will download an app for.

So should everyone build their own app? 

There are many more factors that need to be considered when weighing up the value of building your own app; which platform to build on, user experience, design, future developments, how much it should cost and how is it going to be marketed.

In times of austerity it is vital to calculate what you, the retailer, will get out of building your own application. It is not a magic formula to boost sales on its own and more often then not, the process of development is more costly and time consuming that initially calculated.

For many the answer may be collaborating with others to harness the power of an application in a package that is more convenient to the end user.