Does Your Store Need a Mobile App? (Part 1): Why Building Your Own App May Not Be Right For You

Without a doubt, mobile phones are playing a big role in brick and mortar retail shopping today. Which has many retailers wondering: Does my store need a mobile app?

The question of whether or not to develop a store app usually comes up in discussions about how to optimize current store sites for mobile phones. Retailers know that more customers are using their phones to check prices while in stores, as well as look for special offers and reviews for a particular product. (See graphic from Vibes Mobile Consumer Report below.)

In-store smartphone shopping activities

Retailers also know that more customers are using their phones to make purchases – regardless of where they happen to be physically. So developing a mobile app can sometimes seem like the next logical step. But the reality is that developing your own mobile app might be prohibitively costly, and might not be the best solution for your store in the long run.

Paying a developer to create a branded, a mobile commerce app for your store is likely to cost upwards of $50,000. And in addition to upfront development costs, you’ll need to factor ongoing development and optimization costs into your budget. The reason being, smart phone owners have little patience for apps run slow or that don’t work well.

A 2013 Compuware study on mobile app use found that 79% of users would abandon a problematic mobile app after only one or two attempts to use it, and 84% would decide whether or not to download an app based on past reviews. In other words, if your branded mobile app is not the absolute best it can be, it may alienate the very customers you’re trying to attract.

Another factor to keep in mind is the learning curve and time investment needed for your customers to feel comfortable using your app. As the Compuware study shows, smart phone users may be downloading more apps (41 apps per phone now being the average), but they’re not spending more time overall using their apps.

In fact, app frequency of use appears to be declining, according to app analysis firm Flurry. In 2012, consumers launched apps an average of 3.7 times per week – down from 6.7 times per week in 2009. Retention rates, too, are falling. For retail apps, the retention rate over a 90-day period is now at 33%. That means 2 out of 3 retail apps are deleted from a user’s phone within 3 months.

As a retailer, can you afford to spend $50,000 to $150,000 building and supporting a mobile app that may get downloaded, forgotten, or deleted in the space of 3 months?

Unless you’re a big-name retailer with hundreds of store locations, a better solution might be to offer your shoppers a mobile app they can use with other retailers as well. Customers have more of an incentive to download and become familiar with an app they can potentially use in more than one store, and they’re less likely to delete an app they can use more frequently.

Of course, a mobile app for a retail store should do more than just duplicate the same shopping experience you already offer your customers online. To learn more, read the second installment in our “Does Your Store Need a Mobile App?” series next week.

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