To build or not to build? Mobile apps for ecommerce
Together with Matt Hudson we discuss M-commerce, why should commerce brands care about their mobile experiences in 2022 and how much does it cost to build a mobile app for ecommerce.
Matt started his journey in software engineering when he was 12 and sold his first website at 18. He has been an ecommerce Mobile App Architect, consultant, and mentor since; and has just recently launched BILDIT, a native ecommerce platform for mobile apps.
Mobile app development in 2022
—It's 2022, and with the legacy after the Pandemic and the ecommerce boom, it seems like many commerce businesses have mobile apps. So why, in your opinion, is this topic so popular?
Well, there are a few things about that. Number one: only about 25% of ecommerce companies have an app. They do seem ubiquitous to technologists like me. When I joined Belk many years ago, I was surprised that they were just getting an app. Even though that feels like it's all around us — national brands and many mid-tier brands don't have an app. And even some large-tier brands don't have an app, especially DTC.
It is a hot topic, coming back in 2022 when the genesis was 2016, partially because we see a behavioral shift. And the behavioral shift is important to understand because companies talk about a particular topic as a "kind of a trend." For example, the Metaverse is very trendy. Yet, there are not a lot of companies selling in the Metaverse. For years it was Augmented Reality. Or even Mobile in 2016.
The truth is that companies take a long time to catch up, and customers' behavior takes even longer to catch up. Even ecommerce actually has a relatively small percentage of overall transactions compared to the store.
But we all feel ecommerce — everyone has ecommerce on the web. Customer experience on desktop from many years ago has changed since the Pandemic. Older customers, in particular, become used to it: they like it, and now they're users.
What has happened over time is that users shipped to mobile web. And we saw many customers shifting, and suddenly companies going, "oh, 50% of my traffic (or 25- 50%) is now 60% of mobile web".
We'll see that in the next ten years, desktop will continue to decrease, the mobile web will continue to decrease, and mobile apps will continue to increase. And before the technology shifts and changes with it, there's this funny little tale which everybody talks about - it's really popular, like QR codes. It feels like it dies, nobody talks about it, and then BOOM! — QR codes and mobile apps are back.
Well, they really didn't go anywhere. The users just got caught up and realized this great experience of Starbucks, the great experience of Amazon, etc., and they've now been coached to utilize it.
So, you train the users to send them to your best experience. Companies are looking for new ways to provide incremental value. And mobile app is its own channel, marketing-wise and experience-wise. And the technology suits to bring people into stores. So, for retail, I think it's an even bigger boom.
Mobile apps vs. PWAs in ecommerce
—What's the difference between native mobile apps and PWA? Why would you vote for a native mobile app?
Well, it's funny; I don't actually vote for a native app. Many people take my thoughts on PWAs as fighting words, like, I'm at a battle with PWA. What I'm in a battle with is the truth. And the truth is everyone needs a PWA and a mobile app. And if costing and technology were not inhibitors, companies should have both because the web will always be there, and PWA is the best web experience.
But the untruth that I am battling with is this mythological idea that PWA on its own is some sort of a replacement for a mobile app. PWA is great, but there are two things about it.
First of all, PWA is not particularly easy to build. You need great technologists (like the Grinteq team, for example), or some of the others out there. Many IT teams do not have the talent to build a great PWA. And by that, I mean a Progressive Web App that is a single-page application, extremely fast, with proper caching, with all the infrastructure in place to make it feel like the fastest experience possible.
So, as a customer advocate, I think PWA is great. You should have one, and in fact, it should be the baseline.
A native app is for your most loyal customer who wants to come back to you and wants a very fast experience because they're coming back often and shop with you. So, yes, only maybe 20-30%, a maximum 40% of your customers may be on a mobile app, but they are your biggest spenders.
A mobile app is the fastest, best experience - hands down. Because Apple and Google have provided the frameworks for doing that.
PWA is good; it's not a replacement. You should have both, and hopefully, you can find affordable ways to implement both.
How to build a good mobile app and make it work?
—What would be your tips for getting the most out of your mobile app? You mentioned a little bit about marketing and maybe we could cover functionality.
1/ An investment in a relationship with your customers
First, having an app on its own will not benefit you. You must encourage and incentivize market users to download that app. You have to realize that that's an investment in a relationship with them. Once they download your app, they tend to want to come back to you. If your marketing links open up your mobile web and don't open up your mobile app, why has the user downloaded it?
They're your premium customers, and they're going to spend more money, and they're going to convert more. They want to talk to you. If you don't have an app, you're missing out on them. Most customers don't even know Instagram has a mobile web, and you don't use the Facebook mobile web or the LinkedIn mobile web; you use the LinkedIn app. And if the LinkedIn app opened up the web, you would go — "what is happening?”
2/ Mobile apps are not an IT thing, they are a marketing thing
Once you have built an app and your marketing team realizes the benefit of opening up a mobile app with ROAS, they will start pointing everything they can at your mobile app to increase the revenue incrementally. That's the opportunity that people don't see:
- Mobile apps are not an IT thing.
- It's a marketing thing.
- It's an engineering thing.
- It's an agency thing.
- It's a merchandising thing.
To talk about American customers: the Chipotle app provided their quesadilla in their mobile app. First of all, I love that damn quesadilla, and I literally downloaded the Chipotle app so that I could get that thing.
The reason why they do that, though, is because they want that relationship, and they want to create that relationship. And what they know is - once the customer experiences the mobile app, they'll come back. And it creates stickiness to their brand.
So, I would encourage teams to understand: don't just think about "how do I build a mobile app?" Think about "how do I bring that customer experience into the entire customer set?" Your marketing campaigns should drive downloads or opens to the app.
3/ The app has got to be fast and responsive with gestures
Your checkout should be fully native. We saw increases in conversion, a significant number of basis points above regular traffic, and especially mobile web checkout when we created a fully native checkout. And what I mean by that is I don't require a login; I can select my address and payment method automatically.
And it should be fast and responsive with gestures. Those things alone will drive your revenue in multiple factors over the years. We saw 2X growth, 3X growth, and through the Pandemic even higher to where we were, tripling every year, and budgets increase because everyone was like — "Whoa! Why is the app growing so strong?" Because we brought everybody into the mix and pushed it to give the customer the best experience.
How much does it cost to build a mobile app in ecommerce?
—When talking about mobile apps in terms of pricing: if we look at a very basic one or the advanced version - how much would it cost to build an ecommerce mobile app?
That's a hard question. So there are a lot of answers; let's talk about it in different pieces.
1/ Launch a mobile app
First of all, I always suggest: if you have not launched an app — do it incrementally. I love native checkout, but if you have to launch an app and start growing it with a webview checkout, then that is what you have to do. And it's okay.
Initially, you're only going to have a small number of users, so you grow the experience with the number of customers.
So, the first thing is to start somewhere. Get your mobile app out.
2/ Provide a really good utility
Now, you need to be able to do the basics — browse, checkout, search. Don't alienate your customers by providing a marketing app that just provides promotions. Provide them with some utility: scanning products if they're in the store, scanning products depending on what kind of app you're doing, but - scanning products.
Search is a huge one on mobile because the customer has what's called “a mobile moment”, which is basically a two-minute time span when they're in the drive-through at Mcdonald's or they're in the line at Starbucks or whatever.
That's the time when they go to your app because it's right there in front of them. So, you got to capture their attention in two minutes. Search is a big one, providing products at the very top, boosted right there on the home screen. Good marketing that actually sends them to the proper product details pages or PLPs, what promotions are happening, coupons, things like that.
So, provide them a really good utility — number one. Get that out.
3/ Understand the feedback and add native checkout
Understand the feedback from your customer, watch reviews, extend it, go out and add more products and more utility. Add native checkout. I would say native checkout should be a fast follow. It's a hard build, but if you do the initial - you can come in, I would say, below $100,000. Now, it's tricky - it depends on who you are. If you're a mid-tier retailer with few products, that's far different from a billion-dollar retailer with millions of products. There's a wide variance there.
4/ Cut the costs
Some companies spend millions of dollars a year on a mobile app. But what BILDIT exists to do, and companies like Grinteq exist to do, is to provide great software engineering - a great set of known standards, ecommerce packaged up.
In our situation, we provide a content management system and a mobile app together, which can cut those costs in half because we've done all the legwork. Just like when you build a Shopify website, a Magento site, a Salesforce Commerce Cloud website, or a SAP hybrid website, they give you a working website to start. Then you bring it to Grinteq and say, "hey, I want you to do a killer design for me," right? And they do. And then you put it into the solution that they give you.
That's how our product works — we get the same paradigms as those web solutions, where we provide the front-end to the team. They edit it, work on it, design it however they want to, and add features to it. It can be whatever custom design you like, rolling out with a content management system, and then we host it. All of those things save money.
5/ Choose the right ecommerce technology
The other thing is your technology choice. Now, I'm a big native guy. But I also love React Native. For ecommerce, I strongly suggest React Native mainly because of the savings of having a React web team being able to work in your React Native app. And obviously, the benefit of Android and iPhone together. If I was building a killer game, I'm not going to use React Native, okay? But if I'm building a container app that users are used to, that the paradigms exist for, I'm going to utilize React Native.
It's a very mature platform, extremely fast, and development is faster. Unfortunately, sometimes it means you need fewer software engineers, but that's a great thing for customers because they get it faster. People start to realize that if I could deliver a release every four weeks instead of every six, I would do more for that. For ecommerce, I think React Native makes a lot of sense.
If you're making an application, native is the way to go. Whatever you do, limit the number of web views inside the app. There are obviously places where it's appropriate, like maybe around security or your password, things like that.
But the more native you can make it, the faster you can make it - the more beautiful it is.
And if you use the guidelines Apple and Google have given, users will respond to it and say, "I'm just attracted to using the app." The fact that I don't have to log in on the app by using persistent local caching for things like tokens is extremely valuable. What that means to regular folks out there is - there's a reason you don't have to log in on Amazon because they know you, and it lives on the device.
That paradigm doesn't exist on web. That's why you have to log in to the web all the time, and that is often why people like using apps because of things like that - it's just a little easier and slightly less frustrating in their daily lives.
The future of Mobile apps in ecommerce
—Let's talk about the future a little bit. So, what is it going to be like for mobile apps in the next few years?
I want to see the penetration growth. That's what I want to see. Some fun technology things are interesting to talk about here too.
Augmented Reality is obviously gaining some traction. Certain use cases for it are great, like furniture and things like that. I don't think it's going to be “everyone-needed” or anything of that nature, but it's interesting.
I think app clips are really going to be cool. It's going to take a little while to catch on. But the idea that I don't have to download a mobile app and I can still get a real killer, fast, beautiful mobile app experience by tapping a QR code or clicking a link - is good. For those that don't know: if I send a link for a TikTok over a message and I don't have the app, that's an app clip. When I open it up, I can see the full video. That's a miniature version of the app. And I think that will be a great way to introduce customers to your app. So I'm anxious to see if it picks up a lot of traction.
What else? I mean, Apple comes out with new things all the time. The new password list system that Apple, Google, and Microsoft have come out with will be super exciting.
Yeah, I mean, there's probably a bunch of things. Those are my favorite ones, though.
Listen to the next episode: Social Commerce. How digital stores can win more customers in 2023.