Is the Click and Mortar Growth there to stay?
Not all retailers could tap the Online Buying Wave of 2020, though. An 11% growth of app downloads was observed by only those retailers which had existing digital presence (McKinsey, May 2020). Customers also made local e-stores more relevant than popular e-commerce marketplaces by moving to ‘essentials only’ buying with rapidly shrinking shopping carts.
It’s curious to notice that the common Post-COVID narrative of strategic retail business planning was to either (1) become a platform, (2) leverage platforms, or (3) continue business as usual. Yet, no eCommerce models performed consistently in these times.
That’s why 45% to 50% of global retailers who had ‘2021 plans’ to invest in Point of Sale Solutions, Multi-Vendor Marketplace models, and M-Commerce Apps, are holding decisions for more market clarity.
Here are 5 points that can make their decision between developing a Retail Mobile App and Multi-Vendor Marketplace a lot easier.
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4 Reasons to go for M-Commerce Apps in 2021
Are you really ready to share your Customer Data?
Salesforce claims that 73% of customers expect their retail providers and companies to personalize services. What they don’t want is for them to broadcast their private information. Multi-Vendor Marketplaces (Flipkart, Amazon, Shopify, etc) don’t just own the rights to store but also to modify and use data for demand forecasting, large ad serving networks, and more.
Customers, mostly baby boomers and millennials, are not ready for such distribution of private information. With proprietary mCommerce applications; stores can ensure that their patrons’ data is only limited to their own loyalty programs and not towards undue sales calls or sticky social media promotions.
Myth Busted – eCommerce sites also need Marketing Spend!
It’s a common misconception that – “it’s better to pay a marketplace than to spend huge on marketing one’s mCommerce app organically.”
Evidently, retailers still have to buy marketing programs and pay to be featured over online marketplaces. Sponsored listing of vendors, retailers, and brands on online marketplaces is no new concept. Besides, the aim of selling online for retailers is to make it easier for their business to sell, not to willingly pit their inventory against 100 or 1000 more sellers.
Retail Business Mobile applications can help eliminate in-app competition for businesses. It can also filter marketing outcomes to support retailers not online aggregators, especially when customers are showing visible support (60% globally, 88% India, 80% China) for local retailers in the Post-COVID world (Adobe APAC Consumer Outlook 2020).
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Pay to Sell – eCommerce vs. mCommerce Financial Riddle
Referral fees or commission rates by online marketplaces are essentially a driving factor of ‘Cost to Customer’ in retail. Retailers say that fulfillment costs and transaction fees consume a maximum share of their revenue.
In Post-COVID times when services like free shipping rank among top priorities for customers (32% APAC, 75% Americas, 25% MENA region); mounting additional service costs can become a common deal-breaker (McKinsey and National Retail Federation 2020). Even customer subscription fees of eCommerce sites for faster delivery, early access, and easy returns; add to the effective selling price.
Developing an exclusive mobile retail application can help eliminate any scope of platform-dependent costs when wallets are being dearly treasured by half (49%) of the customers (Accenture COVID-19 Customer Behavior Report).
Are you really In-Charge? Content and Customer Experience Control
BOPIS (Buy Online Pick Up in Store) grew by 34% globally last year, yet businesses that offered the service had no options to flaunt it on top eCommerce websites. Voice-based search suffered the same fate despite being quite in demand (57% customers, Salesforce 2019).
Today, control on Content and Design remains alien to many retailers on eCommerce platforms. They can neither update frameworks nor integrate customer experience workflows.
This limits their ability to mimic a change in market behavior. For example, Indian retailers waited until 2020 for a top eCommerce marketplace to offer multi-lingual support. However, mCommerce apps allow retail clients to orchestrate customer experiences based on buying experiences.
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mCommerce is Inevitable
To look for more reasons is to delay the inevitable. While multi-vendor marketplace may remain an active channel of business, the utility of mobile apps can no longer be denied. Popular retail stores and chains have already mapped the combined opportunity of Pure Play Local Retail and mCommerce apps. Fortunately, 2020 has and continues to accelerate the learning curve for many retailers.