June 22, 2017 by Peggy Anne Salz

Value For Money: Shopping Apps Report Reveals UA Bargains And Trade-Offs

Guest Blog: As a mobile analyst, a top 30 Mobile Marketing influencer and a nine-time author, Peggy Anne Salz tracks the trends, brands, organizations and innovators who shape how we do business and engage with consumers across the multiple screens, devices and apps. Peggy is a regular contributor to Forbes and Harvard Business Review and Mobile Analyst with VentureBeat. She’s the Chief Analyst and Founder at MobileGroove, a top 50 ranked tech destination, which produces and promotes custom research, strategic thought leadership and knowledge resources for the global mobile industry.


Shoppers – and even just people in “shopping mode” who are browsing, not buying – are reaching to mobile apps for advice, assistance and added-value. It’s why Google has called out this mindstate in its list of pivotal micro-moments (the “I-want-to-buy” micro-moments) when people are poised to make a purchase. But Google isn’t the only one to recognize the central role of this activity in our daily lives.

App store analytics provider App Annie has also observed the advance of shopping apps, a massive app category that has come to account for a huge percentage of consumer time “in-app.” At APPLAUSE, the app store optimization conference I keynoted in Barcelona, Thierry Guiot, Territory Director South Europe at App Annie, told the audience that consumers spend 50% more time in shopping apps now than they did just a year ago – and the trend shows no signs of slowing.

Clearly, increased time spent in-app – and in-store looking at mobile apps at key points in the path-to-purchase – produces more opportunities for app marketers to influence shopper behavior and activity. But to really impact the outcome – and inspire deeper engagement with shopping apps – marketers must have a deeper understanding of their shopper audience. More importantly, they need a grasp of key data points about their audience and the context (for example, key dates and countries) in which their efforts to engage and convert are sure to pay dividends.

This is where Liftoff’s 2017 Mobile Shopping Apps Report breaks new ground with a granular view of app engagement data. At one level, it covers the “basics,” offering important insights into engagement activities and trends across billions of ad impressions. (Specifically, the sample size is 26.9 billion ad impressions across 4.8 million app installs.) In the same vein, the report divides audiences by platform (iOS and Android), gender and region (APAC, EMEA, LATAM and North America).

But the real attraction in the report is the effort and analysis that has gone into breaking shopping apps down into three key categories (brand commerce apps, marketplace apps, value-add apps), highlighting the engagement and conversion trade-offs app marketers face in each case.

Brand matters but value trumps everything

For example, Brand Commerce apps benefit from strong presence and awareness, but they also face tough competition for users. At first glance, the cost to acquire users appears pricey. However, impressive engagement rates in the double digits (install-to-registration rate of 22.9%) means app marketers can be confident their audience will interact and ultimately convert.
Marketplace apps – a category that includes the likes of Amazon – is a different story. It’s an app category marked by fierce competition for users, which naturally pushes up user acquisition costs. But there’s a twist. Get targeting and retargeting on track, and app marketers can cash in on highly engaged and potentially heavy users who are attracted by choice and hooked by the wide assortment of products and deals apps in this category have on offer.

Unsurprisingly, Value-Add apps, apps that offer rewards, coupons or discounts, enjoy high engagement rates and low acquisition costs. After all, who wouldn’t want to use an app that promises to enhance the shopping and purchasing experience? But there is a caveat: conversions are impacted by context as some users will store the coupons or deals for later rather than use them right away.

Overall, the average cost to acquire a shopping app user across all categories came in at $4.45, and the cost to convert that user to complete the registration process was $30.51, resulting in an install-to-registration rate of nearly 15%. The cost to convert a user to a shopper – a user who completes a first purchase – was markedly higher, hitting $75.86 with an install-to-purchase rate of 5.9%.

Flux and friction

The Liftoff report also expertly analyzes the data to pinpoint months when acquisition costs are low and engagement rates are high. (Hint: app marketers across multiple territories can build audiences on the cheap in months like September, when users are just gearing up for holiday shopping, and June, when summer downtime creates ample opportunities for users to explore what’s on offer.)

Dig deeper in the data, and the findings suggest app marketers don’t just need to double-down on user acquisition efforts and/or engagement campaigns when the conditions (and context) are “right.” App marketers also need to pay more attention to the user journey offered by their app – and any hurdles that may exist on the path-to-purchase. Case in point: Registration.

While install-to-registration costs hover at an acceptable level, the rate of conversion is rather low for such a low-touch event. One explanation for this might be friction in the UI or UX that is causing users to give up on completing a registration. My advice: optimize the flow in your app to ensure you are making it super-simple for users to input the personal data and credit card details that are essential at this step of their journey. As a rule, convenience drives commerce, and registration fuels this process. The effort to remove friction here is worth it. What’s more, it can even have a positive impact on other key engagement metrics and events such as the install-to-purchase rate.

At nearly 6%, the overall install-to-purchase rate reported by Liftoff is impressive. But the actual percentage might actually be much larger if we consider the increasing ability of mobile apps to drive real-world purchases and actions. All the more reason for all app marketers – particularly those with brands, shops and businesses that exist in the physical world – to aim high and dream big.

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