Insights
3 Reasons Mobile Apps Are Worth the Investment in 2023
With nearly 7 billion smartphone users, the era of mobile retail has arrived.
- Article
- 6 MIN READ
- Aug 10, 2023
Vice President, Enterprise Solutions
Summary
In surveying the digital landscape, it’s clear the mobile retail era has arrived — in 2023, the number of smartphone users reached 6.92 billion, or 86% of the global population. And while most companies have responded to this trend with mobile-optimized websites, far fewer have made the leap to mobile app development. The hesitation to develop a custom app often reflects cost concerns; building and maintaining an additional platform can require specialized skills, adding to overall costs.
That said, with research showing 90% of mobile time is spent in apps and only 10% browsing the internet, delivering a high-quality app experience can be game-changing. In this article, we’ll examine how well-executed mobile apps can support targeted marketing efforts, streamline the customer experience, and bolster the delivery of loyalty programs.
1. Mobile apps enable targeted marketing
In a 2022 survey, 78% of respondents indicated they use retailers' mobile apps more often, or about the same as the previous year. Given these high use rates, mobile apps provide immediate access to more customers with minimal investment, all while collecting data that supports targeted marketing efforts.
And because users often stay logged into their mobile apps, companies gain a free marketing channel, enhancing customer outreach without running paid ads. If teams run paid ads, they have more info about who to connect with, allowing them to spend less for a bigger impact — all while achieving more capable data tracking (no cookies required).
These benefits are supported by a 2021 report that found the average US smartphone user receives 46 app push notifications daily. With a push notification reaction rate of 4.6% for Android and 3.4% for iOS, engagement exceeds alternative marketing channels like email. For example, the average email open rate in the same year was 2.3% across all industries, down 0.3% from 2020, highlighting the effectiveness of mobile app outreach.
In short, mobile apps support targeted marketing efforts by leveraging push notifications that generate in-app interactions and enable robust data collection.
2. Mobile apps streamline the customer experience
Mobile apps can also streamline the customer experience by tapping into built-in smartphone features like Apple Pay and other digital wallets, simplifying purchases. Because 32% of North Americans already use digital wallets, this functionality makes the checkout process more convenient for tech-savvy consumers.
But teams can leverage mobile hardware to improve the customer journey in other ways. Because all smartphones come equipped with GPS, location-based integrations can also support multiple business processes — a market forecast to reach $114 billion by 2026. Specifically, companies can tap into location data to show customers nearby stores, deals, and inventory while streamlining the in-store pickup process.
These outcomes reflect those achieved during our work with Arc'teryx, an outdoor apparel and equipment company. For this project, we were asked to build a highly accessible mobile app that would still function with weak connectivity. In this case, instant access to data was vital to the Arc'teryx team so they could make informed decisions about inventory and promotions. At project completion, the new app resulted in a:
+39% increase in sales conversions, and
+29% increase in orders via the app.
3. Mobile apps bolster loyalty programs
Acquiring a new customer is five times more expensive than retaining existing ones. Fortunately, loyalty programs can help your team focus on customers already familiar with your business. And while there are many ways to design and deliver loyalty platforms, a mobile app is one of the best for building authentic relationships through direct, personalized interactions. Specifically, mobile apps can deliver push notifications, recommendations, suggestions, tips, discounts, special offers, and more.
Most important, these communications are individualized and relevant to each customer based on the data collected from app use. A mobile app can also simplify customer reviews, reducing the friction of leaving, liking, and interacting with feedback. And because reviews from verified purchasers are more trusted and valuable, these apps are often equipped with integrated user verification, bolstering engagement. Finally, companies can remind purchasers to leave a review via push notifications, establishing a tighter feedback loop that supports timely business decisions.
These benefits emulate those sought by SMU, a Chilean supermarket chain that asked Apply Digital to help revitalize its technology ecosystem and implement an effective loyalty program. During this project, Apply Digital built a web experience that expanded to include a mobile app. The B2C Android and iOS application maintained a familiar web page experience but allowed customers to activate and use offers by simply sharing their RUT (Chilean ID number) with cashiers. By deploying its loyalty program on a mobile app, SMU made it more convenient for customers to access personalized offers while bolstering data tracking.
Why mobile apps are worth the investment
As the world goes mobile, more companies debate the ROI of mobile app development. And while building an Android or iOS application for all mobile devices might not make sense (i.e., tablets), it’s clear that seamless smartphone experiences are already generating immense value for innovative organizations. So, if you’re considering the merits of building your mobile app, remember that a well-designed platform can:
Enhance targeted marketing efforts,
Streamline the customer experience, and
Improve the delivery of personalized loyalty programs.
If you’re ready to create or level up your mobile app, let’s discuss how we can support you.
Co-written by Jordon Ahosaari
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