Purchases from smartphones and tablets reached $5.9 billion in the U.S. for the first three months of this year. comScore and the U.S. Commerce Department each reported that mobile commerce sales, excluding things like groceries, airplane tickets, and automobiles, accounted for 11 percent of all electronic commerce.
Similarly, Citi Analyst Neil Doshi said in January of this year that ecommerce juggernaut Amazon is likely receiving between $3 billion and $5 billion annually from mobile sales right now. Amazon’s success could foretell future growth for online retailers generally.
Why a Mobile App Makes Sense
Online retailers with good mobile apps, running on popular systems like iOS, Android, and others, may see significant gains in sales. I addressed this previously, in “4 Reasons Every Retailer Should Have a Mobile App,”. There are good reasons that mobile apps make sense, including popularity with shoppers, ease of development, the range of app ideas or topics, and the relative competition.
Perhaps the best way to understand the benefit of a mobile app is to think of it as a new customer channel. Online retailers know there is value in selling on one’s own ecommerce-enabled website — which is a sales channel — and via marketplaces like Ebay, Amazon, or even Etsy, which are each sales channels. Other merchants have both online stores and brick-and-mortar ones. Each of these is a potentially profitable channel, and so is a mobile app.
1. Appear in Marketplace Apps
The first part of your mobile app strategy should be to get products on already existing mobile applications like those from leading marketing places. comScore recently pointed out that shoppers are not likely to have mobile apps from every single online retailer, rather they will typically have three or four mobile apps that they favor. For most American shoppers, at least one of those favorite retail apps will come from an online marketplace.
Ebay may be the simplest place to start, and for the most part if you are already selling on Ebay you are already appearing in Ebay’s mobile app.
2. Develop a Basic Catalog App
Mobile applications have a few advantages over websites even for just displaying products and product information.
As an example, when a user downloads a mobile application on, say, a Samsung S4, that download runs in the background, and might take several minutes. In this time, a retailer may place a significant number of product images directly on the user’s mobile device. So when that user wants to shop for fall fashions on her smartphone, for example, the images pop right up.
The app should be able to accept payments and make purchases, storing the shopper’s payment information right on that shopper’s device. Also consider synchronizing shopping carts across platforms so that a shopper may put an item in the cart on a mobile app and find that item later when visiting the website from a PC.
3. Advertise in Apps
Many popular mobile apps make money from selling advertising space to networks or individuals. These mobile ads can be a great way to either promote a mobile app or sell product directly.
Amazon, recently released Mobile Ads API to help developers add mobile ads to Android and Kindle devices. This API is also an opportunity for online retailers to place ads in mobile games or other mobile applications.