What this means: Across retail, it’s still presumed that most consumers shop digital channels via a retailer’s e-commerce site. However, proprietary mobile apps create an easy gateway for retailers to interact with shoppers in a controlled way. Owned and operated apps bring consumers into the brand ecosystem and can offer shoppers higher levels of rewards and service that ultimately can define that shopping experience and drive conversion.
The vast majority of consumers (78%) are using retailers’ mobile apps either more often or about the same as last year, according to a report from Airship. This preference for retail apps extends across age groups and household income levels.
Generationally, 81% of millennials and 79% of Gen X report using retail apps more or about the same as last year, followed by 72% of both Gen Z and baby boomers. High-income households lead in regular use of retail apps at 82%, followed by 79% of medium- and 75% of low-income households.
When consumers were asked what motivates them to opt in to receive brand communications on their smartphone, the biggest gains across the prior year were discounts, loyalty rewards and offers personalized to browsing behaviors, past purchases and current location. The data suggests that inflation and the current economy is driving more deal-motivated behaviors from consumers, Airship reported.
“This represents an opportunity for retailers to expand their understanding of customers in order to better cater to their needs, preferences and wishes,” Thomas Butta, Airship’s chief strategy and marketing officer, told Retail Leader Pro. “Mobile apps have become a primary destination for consumers due to simple, contextual interactions, faster transactions and streamlined experiences that elegantly span their digital and physical worlds.
“Retailers are able to personalize offers and the overall customer experience. For example, when a shopper visits their favorite retail store, they could be reminded of their loyalty rewards balance and learn that it is a double reward points day for purchases over $200 in product categories they care about.”
Globally, the majority of consumers across all 10 countries surveyed regularly use mobile apps from their favorite retailers, Airship reported. Respondents in Singapore and Brazil demonstrated the strongest retail app adoption. According to the data, 85% of respondents in Singapore and 81% in Brazil used apps more or about the same as the prior year, compared to 77% in the U.S.
When Airship asked about the ways consumers use their smartphones while shopping in physical stores, using the retailer’s app saw the biggest growth year-over-year across 10 different activities. Globally, 74% of respondents said they are likely to use the brand’s app when shopping at its physical storefronts.
Of the countries included in this research, the U.S. saw the biggest annual gains in using the retailer’s app while shopping in its stores.
“Mobile apps remove friction from the shopping experience,” Butta explained. “They make it easy for shoppers to complete a variety of helpful tasks, such as: access discounts and loyalty reward points while paying at checkout, build a shopping list, check availability, find the item’s specific in-store location, access product details, compare options, read customer reviews, and streamline omnichannel fulfillment like buy-online-pick-up-in-store or curbside pickup.”
Apps also have an inherent advantage to reach people wherever they are at the exact moment it matters most, as notifications are delivered to smartphone lock screens.
“That has become key for streamlining the modern customer experience and rewarding patrons for their loyalty through incentives or special access,” Butta said. “Since last year, earning loyalty points/discounts or receiving offers personalized to browsing behaviors, past purchases and current location grew the most as opt-in motivators.”
In the face of growing privacy regulations and third-party data deprecation, apps also have become an essential source of first- and zero-party data.
“Customers benefit too by being able to easily share their preferences and affinities for more personalized service, providing greater control over their data and the ability to easily shut down brands that aren’t meeting their needs,” Butta said.
Going forward, Airship expects consumers’ usage of mobile apps will continue to grow, similarly to the past few years. Globally, 33% of respondents indicated they are using retailers’ mobile apps more than the prior year and 45% said they are using them at about the same level. In Airship’s 2022 report, 39% of consumers indicated they were using retail apps more often than the year before and 37% said their use was about the same.
“Collectively, this shows regular use of retailers’ mobile apps has ticked up another 2% in the past year across our sample of 11,000 global consumers — and all of that is building on a dramatic acceleration in app adoption and use brought on by the pandemic,” Butta said. “To serve today’s customer expectations, brands must create direct digital connections that offer always-on utility, streamlined and convenient experiences and individualized control — all of which reach much deeper into the hearts and minds of customers. The best way to do that is through an app, where creating an ongoing, reciprocal value exchange makes life better for everyone involved.”
What’s next: As consumers look for value across retail, apps provide an avenue to communicate promotions and value to shoppers. Coupons and discounts can easily be used via an app during in-store purchases and for price-sensitive consumers, this could be an easy way to drive loyalty and engage savvy shoppers. Consumers may look to an extra trip in store based on savings communicated in-app as consumers look to maximize value.