Why This is Not the Right time for Ecommerce Companies to Go App Only

Over the last couple of months, I have been reading & listening to lot of senior digital executives on the pros and cons of why go only Mobile App Only approach.

While the senior experienced online entrepreneurs have a point to prove based on what direction they wish to take their e-commerce business but this is leaving a lot of brands and new online retailers in a state of chaos.

While the decision is still not out on which is a good strategy and lot will depend on how this is executed by different online retailers, I am trying to simplify for people like me who are less informed.

What does Mobile App Only Means?

When a retailer decides that his store is only available & accessible in an application, which is supported only in Smartphone, Tablet and other portable device. This would mean customers willing to buy from the retailer would have to first download retailers App from platforms like – App Store (iOS) and Play Store (Android) and others.

Definite advantages of Mobile App

• Enhanced experience: Mobile apps give superior experience to customers, it’s faster and feature pact.
• Personalisation: As retailer, you can personalize the experience unique to each user’s device. Based on Device OS, Earlier Order History, Search & browsing patterns, Location – you can customize the entire experience you offer to a user. For ex. Search results could boost products based on the Geo Location & affinity of customers in that geography.
• Dynamic Pricing: Unlike desktop and mobile site, Mobile app gives you the advantage to do dynamic product pricing, promotional discounting opportunities. Since this is personal – you can decide who gets to see what price.
• Offline-Online Synergies: If you are a retailer with Offline Presence, a mobile app could build larger synergies for increasing foot-falls to your store when the customer is around. You can personalize and pre-alert the offline staff – based on the browsing / order history of the customer. Your mobile app could also help in ordering online & store pickup or could guide the user to nearest store. You could offer App assisted search inside a store to find the product quickly in a physical store. The opportunities could be more based on the category you operate in.
• Faster & Better Communication: Unlike emails and SMS communication, Mobile alerts and notifications are far quicker and have a higher response rate.
• Access to Mobile features & functions: Native apps allow you to use mobile functionalities to do Voice Search using Mic, Image Search using Camera, Barcode scanner for quick order placement, access to address book and so on. These features helps in making the online buying experience a delight for the customer using the retailer’s mobile app.
• Mobile First: In India, we are witnessing very high growth on new users on mobile compared to desktop. A large majority of Tier III and IV users are accessing the online stores only through Mobile, with Android leading the pact.

While their could be lot more advantages, their also exists a few downsides to Mobile App Only Approach –

• Snacking of the Online Store: Mobile apps need to be downloaded and that means a user has to get convinced first before hitting the Download button.

As a retailer, if you are very large known brand, a user will be more inclined to download your app the first time as compared to a relatively new unknown startup store. This is the first obstacle that hits the mobile app only strategy.

For a new user, the effort and resistance to install an app is higher than just opening a mobile site of the same store. And so if you are Mobile App only store then you could loose a lot of users who are reluctant to install apps for various reasons.

Alternatively, if you have a good mobile site too, you could allow the user to check the mobile site and then prompt him to install the app. This could lead to better engagement and lower drop rates.

• Young and not so Young Audience: Users who are exploring internet first time through a mobile phone are more comfortable to do everything using a small screen compared to the ones who have been using laptops and PCs for more than a decade now. And so when you move an App Only approach you actually are risking loosing those users who are use to large screens and who might have more cash compared to their young counterparts.
• Screen Size, Operating Systems & Connectivity: While they are getting better with time, there are challenges in getting a seamless and optimum experience delivered on all the possible combinations of screen size, OS and data connectivity.
• Building a Smart App Dilemma: Having an app and building an optimum app are two different things. While the first is more of a check-box in the list but achieving an optimum app for the retail store which can get you lot of sales is a iterative process which gets better over time. And so App Only approach if not executed greatly could lead to southward movement of all business indicators.

There is no one size fits all formula on this. A lot would depend on the category and format the online retailer operates. Also retailers should evaluate their core customer profiles & their expectations while deciding to go App Only.

Mobile era is exploding faster than what happened during desktop days. And so a lot of innovation and futuristic thinking will go in the use of Mobiles for doing business especially for online retailers.

India will lead the way on use of mobile for e-commerce but while we chase and capitalize on this opportunity we need to balance and follow caution so that businesses survive and don’t eliminate loyal customers in the journey.

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