Will loyalty save the mobile apps market?

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By: RickFerguson |

Posted on January 27, 2017

Whither the global smartphone app market? With smartphone developers long removed from the heady days of blockbuster download numbers and control of the cultural zeitgeist, brands are now wondering how to reinvigorate the app market to engage customers and leverage the resulting data. The key, says MarketingDaily contributor Jeff Sopko, may be loyalty program apps.

By Rick Ferguson

The numbers for the app market are gloomy; according to research from the Nomura Group, US app downloads declined by 20 percent last year, while the average American downloads less than an app per month. The reason, according to Sopko, is the increasing usability of the mobile web. Money quote:
"Given mobile web’s evolution in load times, personalization and customer experience, it has reduced the need for shopping apps and reduced app market share. Mobile web also doesn’t require users to download and take up room on their home screens for apps that they may not often use."
At first glance, declining app downloads might not appear to impact your marketing strategy, but there are implications; a customer downloading your app, rather than relying on a mobile web browser, to interact with you demonstrates positive action on the customer's part that most likely correlates with high value. The problem, says Sopko, is that many branded apps provide little value or incentive for use. His solution? Branded loyalty program apps. Citing apps from Walgreen's, Under Armour, and Sephora as success stories, Sopko celebrates their ability to engage customers:
"So, what do each of these apps have in common? 
"Customer-Focused: They’re not trying to sell you outright. They have a true purpose and function that provides real value to users.
"Experience-Based: Each app is trying to enhance experiences for customers: Under Armour through the workout journey, Sephora through beauty, and Walgreens through health and convenience."
Loyalty apps also provide the twin motivators of reward and recogntion - essential ingredients in any recipe to engage and build relationships with best customers. Downloading a brand's app is the mobile equivalent of taking our a plastic loyalty card at the point of sale: A positive, kenetic action that demonstrates engagement and is predictive of future customer value. That's why apps are worth investing in - and why loyalty programs will continue to drive their success.
Rick Ferguson is CEO of the Wise Marketer Group.