Trends, Costs and Benefits of mobile Shopping Apps

Having an App for your business is much more than “nice to have”. Basically, with your business App your engage your customer base and drive your sales.

Trends

Recent numbers by Apptopia show a strong trend towards shopping apps. Worldwide downloads grew to 5.70 billion in 2018, a plus of nearly 10% over 2017. Android is responsible for 3.30 billion downloads, Apple’s iOS had 2.40 billion downloads.
According to data from App Annie, users spent a massive total of 18 billion hours in in shopping Apps in 2018. The bottom line? Users install shopping apps with a high intent to purchase items.

Costs

How much does a user cost before she actually purchases an item? The cost breaks down to three distinct areas.

  • User acquisition cost: how much do you have to spend to motivate a user to download your app?
  • User registration cost: how much do you have to spend to get a user to register?
  • User purchase cost: how much do you have you spend before a user makes her first purchase?

Here are the numbers:

  • It costs an average of $4.12 to acquire a new shopping app user.
  • The cost to acquire a user who completes a registration is $13.81.
  • The cost to acquire a user who makes a purchase comes in at $39.38.

The cost is calculated by a simple formula: money spent for getting new customers divided by number of new customers. The costs include the money spent for building and maintaining the App, marking activities like buying online ads to drive more App installs and costs related to creating content for your app.

Benefits

After spending all this money, what are the benefits for your business?

  1. Customers tend to spend 3 to 4 times longer in mobile apps than desktops.
  2. Lowest cart abandonment rate (mobile Apps: 20%, desktop 68%)
  3. Customers spend twice as much money in mobile apps than on desktops or mobile sites.
  4. Customers are twice as likely to return to a mobile ecommerce App within thirty days than to desktop.

Depending on the your App user base, shopping cart size, shopping cart abandonment rate and marketing costs your App investment can pay off already within the first six months. There are also additional measures to cut costs and to drive engagement. For example, automating content generation and content distribution optimizes costs related to marketing. Active apps drive customer engagement and thus increase chances that customers will buy.

Links

https://www.forbes.com/sites/quora/2017/12/19/why-many-online-shopping-sites-are-becoming-mobile-shopping-apps/

https://content-na1.emarketer.com/retail-apps-gain-real-estate-on-shoppers-smartphones

https://www.appannie.com/en/insights/market-data/the-state-of-mobile-2019/

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