Reports: Retailers Must Up Their Game to Compete in Apps Battle
Despite the 60 percent growth of mobile e-commerce to $120 billion in 2015 from 2014, many merchants are doing little to sway consumers to use their apps versus using a mobile browser, according to a Javelin study. Last year, consumers’ purchases via Web browser totaled $75.3 billion, while retailer apps accounted for just less than $47 billion.
“With the holiday shopping season upon us, retailers must stay off of consumers’ naughty list by meeting consumers’ mobile shopping expectations for a streamlined experience and fast and secure checkout options,” said Emmett Higdon, director of mobile, Javelin Strategy & Research. “Cutting-edge retailers like Adidas, Nordstrom and Sephora are also using augmented and virtual reality to provide shoppers with mobile-exclusive experiences, enabling them to preview purchases in their own homes and virtually ‘try’ products before making a decision.”
The study, “Mobile Online Retail Payments 2016: Reinventing Shopping in a Mobile-First Era,” also indicates that payments via smartphone account for 70 percent of m-commerce, with half of consumers using a browser and 20 percent using an app. Payments by tablet app is 19 percent and 11 percent for tablet browser.
Another recent study, “Reassessing Mobile Payments: A Duopoly or Oligopoly?,” indicates that 18 percent of smartphone owners have used a mobile payment app and PayPal is tops among them, according to Parks Associates. Among all smartphone owners, 12 percent use the PayPal app, 9 percent use a retail-branded app, 4 percent use Apple Pay, 3 percent use Android Pay and 2 percent use Samsung Pay. The top two retail-branded apps by usage were Starbucks and Dunkin’ Donuts at 7 percent and 3 percent, respectively.
“Merchants must be ready to accept mobile payments because those that wait will be at a competitive disadvantage,” said Chris Tweedt, research analyst, Parks Associates. “Marketing efforts from PayPal and Apple to promote their solutions will increase consumer awareness, adoption and spending.”
The study notes that payment app users spend $98 per month using PayPal, $75 per month with Apple Pay and $56 per month with Android Pay. Parks Associates expects transaction values to grow more than seven times that in the next five years.