Updated with new information & best practices in February 2018
Updated with new information & best practices in February 2018
In late 2015, nearly two thirds of US consumers didn’t know if their favorite retailer had a mobile app. But in a survey Localytics conducted in late 2017, nearly one half of US consumers said “shopping via apps” is a primary reason they use their smartphones.
In just a few years, shopping apps have gone from having poor awareness to relatively high usage. This increased usage isn't just driving more ecommerce sales either; it's driving more in-store sales as well.
According to the same survey mentioned above, 48% of consumers said they made a purchase in-store as a result of receiving a personalized push notification and 36% as a result of receiving location-based push notification (triggered by a geofence or similar location tracking feature).
So this is what people say about using shopping apps, but how often are they actually using them? To find out, we segmented our client base by industry and looked at the numbers for companies in the retail and ecommerce space.
In the following sections we'll show you how to create a new mobile strategy or refine an existing one for 2018. But before you do this, you need to know what success looks like. While success means different things for each retailer, our 2017 H2 retail benchmarking report shows you how shopping apps perform on average.
Before you can launch effective retail marketing campaigns, you need to have a few things ironed out to ensure you’re getting the highest possible return on investment for your efforts. You can have the best marketing campaign in the world but if you’re targeting the wrong users, it’s sure to be a flop. So how do you ensure you’re attracting high value users to your app in order to set your campaigns up for success?
1. HAVE CLEAR MESSAGING: A key part in attracting users to your app is to have clear and concise messaging. Since retail apps are becoming increasingly popular, it’s becoming more difficult to stand out from the crowd. Therefore, when people see your ad placements, they should be able to instantly understand exactly what your app is, and the value it provides. Make sure your ads show customers why they should download your app and how it will it make their mobile shopping experience better.
2. FOCUS ON HIGH-VALUE ACQUISITION CHANNELS: In addition to having solid messaging, pay close attention to your user acquisition plan. Which channels are bringing in users with strong engagement and LTV (lifetime value)? App downloads are a vanity metric. Who cares if an acquisition channel is attracting thousands of users to your app if they simply churn days later? Instead, make sure you’re attracting only high-value users to your app by closely monitoring LTV.
How do you go about this? Make sure you invest in a mobile marketing platform that gives you insight into attribution so you can truly understand where your high value users are coming from. Odds are, you’ll be advertising on several different places, from social media to paid search. If you monitor the sessions and LTV of the average user brought in by each channel, you can understand its true impact. Cut those that are attracting a high rate of users who churn and invest the additional spend in places where you’re obtaining high-value users.
If there are certain groups of users who are particularly relevant to target, be sure to take advantage of features like Facebook’s Lookalike Audiences. Lookalike Audiences allow you to send Facebook a list of your customers that are highly valuable and Facebook then shows your ads to Facebook users who are similar to those high-value customers.
3. CREATE USER FUNNELS: Once you know you’re attracting the right audience to your retail app, it’s time to create funnels that give you insights into how your users behave and how your app drives results. Understanding the app user lifecycle is crucial to this part of your mobile marketing strategy, because the way you engage with your users should be based upon where they are within the lifecycle. Different marketing channels work at different points. With a solid mobile engagement platform, you can set up many different funnels to evaluate user flows, conversion paths, and in-app actions. Below are some funnels you should create to help you optimize your in-app experience:
Given the importance of onboarding, how do you know if yours is effective? By creating an onboarding completion funnel, you’ll be able to tell. A funnel will show you how many users progress through each step of the onboarding process. If a significant number of users are falling off between certain steps, that’s an indicator that something about the app or the onboarding process isn’t working. In that situation, look through your app and make sure it’s easy to use. You should also consider reevaluating your onboarding process to ensure you’re delivering clear, concise instructions that highlight key app features that promote engagement.
Wayfair is a great example of a brand that has an excellent app user on-boarding process. Within seconds of launching the app, users are made aware of the top three benefits associated with using the Wayfair app.
The onboarding process begins by clearly communicating that signing up to use the app will be beneficial to users as their purchases will be faster and more secure:
Wayfair also incentivizes customers to use their app through exclusive sales, limited time offers, and a host of special features:
Conversion: Conversion funnels are straight-forward but also a must. A conversion funnel shows you how many users start the path to making a purchase and how many end up actually placing an order. A typical retail conversion funnel looks like:
1. User views a category.
2. User views a product.
3. User adds product to cart.
4. User proceeds to checkout.
5. User completes checkout process.
Conversion funnels are important because they help you pinpoint areas where you can improve your app’s user experience or identify potential bugs. When evaluating a conversion funnel, look for a significant drop-off in the number of users proceeding from one step to the next. This indicates that there is something interfering with the user proceeding.
For example, if a lot of users proceed to checkout, but very few complete the checkout process, perhaps your checkout process is cumbersome or confusing. In that case, you might want to consider revamping your app’s user interface or adding quick pay options like Apple Pay and Google Wallet. Alternatively, a drop off like that could indicate that there’s a bug with your app that’s preventing people from submitting their payment information.
Now that you have the proper structure in place, it’s time to build your marketing campaigns. Read on to learn the effective ways to engage with your users throughout their lifecycle:
As previously mentioned, onboarding is a MUST for apps. It’s your chance to set first time users up for success while ensuring they understand not only how to use your app, but why they should use it. In addition, onboarding can also come in handy further down the line when you release app updates. Below are some key onboarding campaigns you should be running with your retail app:
INTRODUCTION: This is a series of in-app messages that are shown to new users in order to help them become acclimated. Lead with your best foot forward and showcase any key functionality and cool features or benefits your retail app has to offer. By the end of the introduction, users should know how to use your app to complete basic tasks like searching for a product or checking out.
Chick-fil-A's onboarding introduction clearly depicts the benefits of their app to the user by highlighting special rewards and easy ordering capabilities:
PRO TIP: End your onboarding process with a CTA that drives users to start exploring your app. You might even want to consider providing an incentive for them to make a purchase right then and there. Something like free shipping for new users on their first day in the app usually does the trick. This helps set them up for success while moving them through the funnel.
Chick-fil-A ends their onboarding with a food incentive, while Target uses theirs as an opportunity to showcase the value of opting in for push notifications:
NEW FEATURES: Whenever you launch significant new app features, make sure you share them with your users by giving them a very quick overview of the update, and highlighting any key enhancements. This strengthens the user experience while boosting engagement since they know you’re invested in making your app better.
PRO TIP: Use an interactive tutorial to walk users through new features. This ensures they fully understand how to take advantage of the new functionality.
Chick-fil-A's tutorial easily shows users how to place their first order within the app:
EFFECTIVE PERMISSION REQUESTS: We know from research users who have push enabled will open an app 3x more often than users with push disabled. We also know that asking users for permission to send them push notifications during their first app visit is a major faux pas unless it is at the end of a compelling onboarding campaign that clearly showcases the benefit to the user. Users need to see the value in your app before they’ll be willing to grant you permission to reach them. Tit for tat. The same goes for any other permissions you want to ask users for, such as enabling location tracking so that you can send them location based push notifications when they’re near one of your brick and mortar locations. The ask needs to clearly depict the what’s in it for your consumer.
PRO TIP: Increase the likelihood that a user will enable the permission by leading with an incentive. For example, a user might want to enable push notifications because they’ll get told the instant an item in their wish list gets discounted. When users understand that the reason you’re asking for something is to provide value to them, they’re much more inclined to agree.
Aldo, Target, and Gap all effectively ask for permission requests by clearly outlining the "what's in it for me" to their users:
In-app marketing campaigns are similar to onboarding campaigns in that they take place while a user is within the app. However, the key difference is that onboarding campaigns happen immediately upon opening the app, whereas in-app messages happen during use.
Great in-app messages guide users through funnels and help them complete tasks. They should also take advantage of rich media and match the app’s unique branding. Below are several retail-specific in-app marketing campaigns you need to try:
SHOPPING CART/WISHLIST REMINDER: Let’s face it, most of us have a short attention span these days and are constantly multi-tasking. So why not give shoppers a friendly reminder about something they forgot to finish? Sending an in-app message about items left in their shopping cart or on their wish list is a highly relevant way to engage with shoppers, and help them to convert.
PRO TIP: Consider having a progression of in-app messages for cart abandonment. The first message is just a reminder, whereas the second provides an incentive for the user to checkout, such as offering free shipping.
PROMOTIONS/SPECIAL OFFERS: Having a sale? Let users know while they are browsing your app so they can take advantage. In-app messages are also a perfect opportunity to provide users with a special offer that’s personally relevant based on their purchase history.
PRO TIP: Avoid blasting out every sale you have to the masses. Instead, a more effective approach is to segment your offers based on user history and purchases so they are highly relevant to the user.
TRANSACTIONAL: When shoppers convert within your app, it’s important to have in-app messages in place confirming these conversion actions. A simple confirmation message will ensure their transaction is complete, letting them rest easy that their new shoes are on the way.
Dunkin Donuts confirmation screen lets users know their order was successfully received and up-to-date information about their card balance:
PRO TIP: Follow up a transactional in-app message with an email to shoppers so they have all the details they need in a safe, static place. This can include things like receipts and shipping confirmation.
REVIEW PRODUCTS: Ask shoppers for reviews a few weeks after they purchase an item. Not only does this give your customer an opportunity to voice their opinion, apps with reviews enjoy a 3x higher conversion rate and 5.3x longer average session length than those without reviews.
PRO TIP: If you’re having difficulty getting enough reviews, consider incentivizing shoppers to review products.
NPS REVIEWS: Speaking of reviews, creating an in-app message that asks users to ‘rate the app’ via an NPS score is a perfect way to separate your promoters from the detractors. If a shopper’s rating indicates they are neutral or a detractor, you can have the in-app message request that they provide feedback via a text field. Not only will this provide you with valuable insights into your app’s weaknesses, it will allow users to vent privately rather than in a public app store review. For those users who indicate they’re promoters, the in-app message can have a CTA that redirects them to the app store, where they can provide a glowing rating to help boost your app’s rating.
PRO TIP: Your in-app NPS should be branded so it feels like part of the app experience rather than an ad. Have some fun with it to entice shoppers to review, and make it unequivocally you.
App inboxes are like an email inbox inside your app. They are incredibly useful for several reasons. For starters, they are a far less intrusive messaging channel than push notifications or in-app messages, so you don’t have to worry about annoying a shopper with a poorly timed message. Additionally, unlike push or in-app, inbox messages don’t disappear once a user has viewed them. This allows users to revisit a message multiple times. A third benefit of inbox messages is that they are scrollable, so you can fit much more content in an inbox message than you possibly could with push or in-app. Retail marketers can take advantage of app inboxes in the following ways:
ON-GOING PROMOTION: While in-app and push notifications are great for one-day sales, inboxes messages are the better option for promotions that have longer time frames. Shoppers can go back to the promotional message in their inbox for details, and you aren’t forced to send spammy push or in-app reminders about the sale.
PRO TIP: Since inboxes are perceived as highly personal, make sure your messages are personal. Avoid sending broadcast inbox messages. Rather, target groups of users based on their preferences and historical in-app behavior.
LONG FORM CONTENT: Want to get a message across to shoppers that’s more than a few words? Cue the app inbox, which allows you to send scrollable, media rich content. This makes an inbox message the perfect way to send content like blog posts or weekly fashion tips. Take advantage of the inbox to strengthen your relationship by engaging with users on their terms.
PRO TIP: Since imagery is rather limited throughout other messaging channels, take advantage of your ability to send image-rich content to users.
Ah, push notifications. The bread and butter of mobile marketing. When done right, this highly effective tool can increase retention by over 3x. But when done wrong, it can quickly cause users to churn. So what does the ‘right’ push notification look like? While we could go on for days about this subject (and we have - eBook, blog, another blog), let’s walk through a high level overview of retail push notifications done right.
ANNOUNCE NEW ARRIVALS IN A CATEGORY THEY’VE PURCHASED FROM: Segment users and reach out to them with information pertinent to their shopping habits. New Michael Kors bags? Send a push out to shoppers who have purchased or browsed Michael Kors in the past. New line of salads? Let your health conscious users know first.
PRO TIP: Be mindful of any overlaps between segmented pushes. Many shoppers have diverse tastes, and could easily receive several different promotions that technically align with their tastes. So make sure you don’t bombard certain users with too many offers. A good way to limit the volume of notifications a user receives is to only notify users who have purchased from a category multiple times.
ANNOUNCE EXCLUSIVE SALES: Who doesn’t love an exclusive sale? Push notifications are the perfect way to announce one-day, exclusive sales that boost conversion. Segmentation still comes into effect here, since you should group users based on similar characteristics; lapsed users, shoppers who have spent over $100 in app, shoppers who have items in their carts, etc.
PRO TIP: Copy-text is king when it comes to push notifications, especially when you’re pitching an offer. Relay a sense of urgency combined with action-oriented text to try and boost swipe throughs. Really drive home the one-to-one relationship by using the user’s name and make it clear that it’s not just any user that’s receiving this offer.
Target's push notification is timely, to the point, and even includes an emoji:
ANNOUNCE ITEMS THAT ARE ALMOST SOLD OUT IN SHOPPING CART/WISH LIST: We all know how much it sucks when something sells out before you can purchase it (Justin Bieber tickets, anyone?). So it should be no surprise that giving users a heads up about items they’re interested in selling out creates a great user experience. The more users can rely on you to help them out, the more inclined they are to stick around.
Sweetgreen & Abercrombie effectively create a sense of urgency with the below push notifications:
PRO TIP: Use dynamic messaging to personalize the notification. Don’t just tell them that an item is about to sell out, tell them exactly what item it is. Also be sure to deep link the notification so that when the user taps on it, they are taken directly to their shopping cart or to the item in their wish list.
TRANSACTIONAL: Much like in-app, push notifications can also be used for transactional messages to give users up-to-date information about their purchases. Amazon sends me push notifications when items have shipped or been delivered. Starbucks sends me a push notification with my order receipt.
Amazon's push notification let's me know my mixing bowls are waiting for me at home, so it's time to bake!
PRO TIP: In order for transactional push notifications to be effective, they need to be timely. For example if a consumer pays for their items using your app, send them the receipt immediately.
SHOPPING CART REMINDER: Let’s face it, most of us are constantly multi-tasking throughout the day. Sometimes we don’t complete tasks because something more important demands our attention. So why not give shoppers a friendly reminder about something they forgot to finish? Sending a push notification about items left in their shopping cart or on their wish list is a highly relevant way to engage with shoppers, and help them to convert.
Fanatics' friendly "forgot something" push notification is an effective way to remind users to complete their purchase:
Unleashing the power of geofences
Unleashing the power of geofences
Geofencing push notifications, are sent in real-time when a user approaches or leaves a specific location (like a physical store). In other words, geo-push gets you as close to 1:1 marketing as possible. But with great power, comes great responsibility. There is a right way and wrong way to take advantage of geo-push, and mobile marketers don’t have the best track record when it comes to using new marketing technology the right way.
What exactly does the right way mean? It means sending highly relevant messages to a select group of users. Even though location based push is fairly new, retailers have already started blasting out broadcast deal alerts to every user who passes one of their stores. That’s a surefire way to lose customers. Imagine a world where you can’t walk past a store without getting a push notification about some irrelevant special deal? No thanks.
The below campaigns exhibit all the elements of a solid, non-spammy geo-push strategy that your users will appreciate:
ANNOUNCING RELEVANT SALES BASED ON PURCHASE HISTORY: If a user walks by your store, geo-push is a perfect opportunity to let them know about a sale they’d be interested in. How do you know they’d be interested? Segment by purchase history.
PRO TIP: Have multiple stores in a given area? Be careful to restrict the geo-push so the end user only gets the notification once.
ANNOUNCING NEW ARRIVALS: Similar to the above, you should also announce new arrivals based on purchase history. It’s a perfect opportunity to keep shoppers in the know, and grant them early access to great new products that they care about.
Zara sent the below push notification to frequent customers (those who shop often at Zara) passing by their store:
UNSPENT CREDIT OR GIFT CARD: True story; I was recently walking by Sephora in downtown Boston when I received a geo-push notifying me about an unspent gift card I - needed to use. The push got me in the door, and, 45 minutes later, walking out the door with an unholy amount of beauty products - far more than what was on my gift card. Retailers have long known that gift cards can be a great way to incentivize larger purchases, geo-push can take that strategy to the next level.
PRO TIP: Let the user know how much they have to spend. The more detailed the push, the more compelling.
PROMOTE LOYALTY PROGRAMS: If you have users that aren’t part of your loyalty program, try sending a targeted offer to drive them to sign up. Keep it relevant by restricting the campaign to members who have walked by one of your stores more than 3x in the past week.
PRO TIP: You can also try the same campaign in reverse. Reward the members of your loyalty program and drive store visits by offering an exclusive deal to those members who have been by one of your stores recently, but haven’t made any purchases.
CVS hit a user with this friendly reminder while they were in-store, so they didn't miss out on any coupons they had on their ExtraCare card.
Reaching your users on mobile is a major part of your omni-channel strategy. Don’t think of it as another device to market with--think of it as another way to connect with your customers and users. And the data’s in favor:
Connecting with your users on multiple channels, when and how they want, is a powerful way to increase customer/user retention. The first step to doing so? Reaching them on the channels where you want to connect. Social networks like Facebook, Twitter, and Instagram each have over hundreds of millions of users.
Remarketing is a tactic used to drive existing users back to your app by advertising to them outside of it, most often through push notifications or paid ads. The most effective remarketing efforts are segmented, both by actions a user previously took within your app and also by their current position in the app user lifecycle.
Below are some highly effective ways to remarket to users:
PUSH NOTIFICATION OR DIGITAL AD TO LAPSED USERS: Does your team currently define a ‘lapsed user’? If not, they should. And while what lapsed means varies from app to app, based on our retention data, we’d be concerned if a user hasn’t opened your app in over 30 days.
Remarket to these users by serving up an engaging push notification that drives them to open the app or show them a compelling ad on Facebook that highlights an item they’ve viewed before to entice them to come back to your app.
Revolve combines an image of the boot a consumer has viewed several times with an effective message and easy 'Shop Now' CTA to drive them to purchase. Converse, on the other hand, showcases some of their great products in the carousel Facebook ad along with a compelling offer (free shipping) to pique consumer interest:
INCENTIVIZED RETARGETING: Retargeting is a great way to entice app users who show interest in a particular product but have not completed a purchase. Identify users who have viewed a product on a number of occasions and incentivize them to buy the product by offering a special promotion such as free shipping or a 20% discount.
When preparing for a sale, marketers can identify users that repeatedly viewed certain products while they were displayed at full price on the retailer’s app or website and retarget them with a relevant advertisement promoting the sale. App users are likely to convert when they receive relevant, highly personalized advertisements from retailers. One study showed that adding social to your retargeting strategy can increase conversions up to 73%.
Macy's & Just Fab both looked at their customer data to send retargeting ads to users who had recently viewed these products, and combined it with a sense of urgency (sale):
Creating the ultimate omni-channel experience involves taking both online and offline marketing strategies and merging them into one to deliver a consistent shopping experience regardless of the channel. Retailers need to invest in technologies that bridge the gap between the online and offline worlds, nurturing customers throughout their entire journey with relevant and highly personalized messaging. This involves harmonizing digital systems such as app, web, and email with the in-store experience to create a seamless omni-channel experience.
A recent study by Bigcommerce revealed that while 96% of American consumers shop online, 65% of their shopping budget is spent in stores. Many consumers still prefer to purchase products in store to try on items prior to the purchase and to avoid shipping costs, waiting for delivery, and complicated return processes. Retailers that create an engaging and complimentary cross-channel experience by seamlessly connecting online and physical stores will successfully retain their customers and experience long-term sales growth by providing customers with the personalized, highly relevant communication that they desire.
To achieve this, retailers should take a step back and list every different way you interact with users and potential users.
Consider where these users fall in your funnel. Marketing funnels look different for every company. Here’s a classic example:
Customers are likely to interact with brands via multiple touch points before they complete a purchase. Having cross-channel data access at every stage of the consumer journey is essential to executing a successful omni-channel strategy. The most successful retailers can seamlessly connect the user experience as customers move through the funnel, providing a consistent experience at every touch point.
Amazon has built an excellent omni-channel retail strategy by converting user data into valuable insights and using this information to execute highly personalized, relevant marketing campaigns in which they target consumers with product offerings based on their behavior and purchase history:
Mobile wallets allow users to store their financial information such as debit and credit card details in digital form on their mobile devices. This allows users to pay for products and service from their smartphone, tablet, or smartwatch without having to reach for their physical wallets. Mobile wallets such as Apple Pay, Samsung Pay, Android Pay, and even payment via the app itself offer users a faster and more secure way of purchasing.
Retailers that leverage digital payment functionality within their apps can create a better experience for users by offering discounts or rewards for those who pay via mobile wallets.
Building a community of loyal app users is a top priority for most marketers and many retailers are falling short in this area.
Here are some important statistics around mobile wallets and how they have become an essential part of successful app marketing:
#1 A study conducted in 2016, by Bond Brand Loyalty, in collaboration with Visa, revealed that US internet users belong to an average of 13 loyalty programs, while only participating actively in half of them.
Building a loyalty program that rewards consumers for making purchases via mobile app, either online or in-store, incentivizes users to become an active customer.
#2 According to a recent study by Finextra, 17% of US consumers now regularly use their smartphones to pay, up from six per cent in 2014.
This figure is only going to increase as users experience better retail experiences such as order ahead, express checkout lines when completing transactions in store, receiving digital receipts, and benefiting from loyalty programs which reward customers with relevant incentives based on their behavior.
#3 More than a third of consumers in Europe and America would go completely cashless if they had the choice, according to a survey by Dutch bank ING.
This desire that consumers have to go cashless is driven by the many benefits of mobile wallet technology which include: reduced fraud, shorter payment time, increased user loyalty and lower transaction fees.
As mobile continues to influence the shopping habits of consumers, it’s becoming essential that traditional retailers keep up and take advantage of all that effective mobile marketing has to offer. Nowadays, it’s easy enough to build an app, but harder to create the experience shopper’s truly want.
Our advice to all mobile marketers: don’t take the easy way out; it never pays off. While you might see a slight uptick in the short term in CTRs or even conversion rates from broadcast messages, in the long term you will undoubtedly face a mountain of churn and fall victim to the mobile engagement crisis.
Remember that in the mobile space, you are no longer just up against your traditional competitors, but against every app offering a kick-ass user experience. Mobile marketers are vying for users’ limited time, and only the ones who offer flawless mobile engagement will win.