2014 looked to be the year of continued messaging app dominance. Facebook acquired WhatsApp for $22b then introduced their messaging app separate to the Facebook core platform . We saw both Snapchat and Kik storm into the under 25 market; even Instagram introduced private messaging functionality.
It was E-commerce however that had the breakout performance on mobile. According to mobile analytics firm Flurry, shopping apps on iOS and Android increased by a remarkable 174% year-over-year. That’s up from 77% last year *Note; the statistics are US only.
The app usage market itself grew by 76% (app usage is defined as a user opening an app and Flurry records the session). Retail, Utilities, Messaging, Health and Fitness and Travel all beat the market growth YoY.
Sports, News & Magazines, Music & Media and Games all had double digit growth but under performed. Those four content-based categories however are growing from a larger user base and are maturing; this report focuses on growth as a percentage rather than the total volume. Regardless, the hike in action-based app usage (shopping, productivity, fitness) suggests an inflection point for the category. Behaviour is changing.
When Flurry dug into the distribution of time spent in shopping apps, they plotted engagement with the retail apps by postcode. The goal was to identify when and where people shop on these apps, “Home” versus “Away”.
As we also see in mobile-device web based shopping, people shop on their phones when they are out in transit during the day, with Shopping app use spiking during 9 a.m. commutes, and at lunchtime. Surprisingly, there’s another spike at 8 p.m., at home. Some are late night shoppers.
US companies are trying to lead the way in servicing this change in behaviour.
In the US, Wal-Mart has released a mobile app that tracks a user’s location using the phone’s GPS and can offer in-store deals when it recognises the shopper in the store.
Macy’s the famous department store chain began testing last November a product called ShopBeacon. The app enables a merchant to find out where a customer is standing in the store (e.g. proximity to a certain product), how long they’ve been standing there and if they haven’t purchased, the merchant can then push offers on specific products.
Beacon technology is being touted as one of the biggest transformations in shopping, coming our way. If you’re in Australia, check out HelloLocal, a friend of ours Brent Nolan is the founder.
The change in behavioural patterns highlights both opportunities and challenges for retailers. There’s now a shop in every pocket. Although the Flurry statistics are US based, they should encourage all retailers to consider the role mobile can play in their shopping experience. However, it shouldn’t be a knee-jerk reaction, rather, whatever solution they derive at must answer the most important question the consumer has, ‘why would I care?’.