Smartphone use is still soaring among consumers. According to a Nielsen study, 61 percent of all mobile phones in the country are smartphones. For consumers aged 18 to 34, it's 75 percent and growing. Now that having a smartphone is the new normal, how can retailers leverage them as a platform to sell more and make more money?
The focus up until now has been on social media apps, which allow businesses to push information out to consumers and to become “part of the conversation.” But so many small businesses have failed to generate a financial return on these activities. Some companies have pushed beyond social and have aggressively moved into mobile commerce, offering consumers the ability to buy directly from their phones. ComScore predicts that mobile commerce revenues may top $25 billion this year.
Even though this creates a new sales channel, it doesn’t necessarily support existing store sales. There is one company, however, that has taken an innovative approach to mobile commerce and developed a mobile app which achieves social communication, mobile sales and increases existing store revenues.
Home Depot is the largest home improvement store in the country, with more than $74 billion in revenues across its 2,250 locations. The company generates over $12 million in profits per day. As a retailer, it is among the most successful in the world. Trish Mueller, Home Depot's chief marketing officer, is a strong proponent of retailers leveraging mobile phones to engage consumers. Its app has been downloaded over 3.5 million times, and more than one-third of its online traffic originates from mobile devices.
Even though your company’s annual revenue target may be what Home Depot makes in an hour, you can take the best features of its popular mobile app, and use it for your own.
Fab Four Features For Retail
There are four sections of Home Depot's app that work well. Small businesses considering mobile app development can implement similar features that complement their individual businesses.
1. On-phone purchase, in-store pickup. The app offers consumers access to all the company’s products available in stores, which currently stands at more than 35,000 products. Users have the ability to search for a product, purchase it via the app and simply go to the nearest location to pick it up. This saves customers time when they need an extra part or an additional tool for an active project.
2. In-store aisle locator. It’s very annoying when you walk into a store and can’t find what you’re looking for. Large and small locations with limited staff can lose customers who in frustration simply leave without buying what they need.
The Home Depot app solves that problem by providing the aisle number and the bin number within that aisle for each SKU in each location. This eliminates the need to track down an employee to tell you where a particular nail or screw might be located. This is a perfect example of how a mobile app can increase in-store sales, and not just for gigantic sprawling stores. It can work equally as well in a boutique to help a customer find the right sweater in the right color and size.
3. Voice-activated search. Both iOS and Android smartphones offer voice recognition software, which captures the user’s voice and translates it into text. The app leverages this technology to permit users to search store inventory via the app using their voice.
4. Barcode scanner. This feature ties in the social element. Using your smartphone's ability to scan barcodes, users of the app can access customer reviews and other information on a product while evaluating it in the aisle. Customer reviews can go both ways. If you do plan to offer access to this information on a mobile app (or anywhere else), it’s important to monitor customer responses and reply to them inline.
Mobile App Costs
Developing a custom multi-purpose app for your company with similar functionality isn’t cheap. According to a recent survey by AnyPresence and a study by Propelics, developing this type of app could cost from $50,000 to over $100,000 depending on the specifics of your project. To determine if it’s worth the expense, you need to quantify the potential increase in sales at your existing locations as well as the potential new sales from mobile-only customers. You should also compare this to the cost of opening a new physical location.
But before you go from zero to the best app in the world, consider testing out your assumptions with hosted apps or developing a simpler beta version. Companies like ContractIQ can help match you with offshore developers that can quickly develop your custom apps for a reasonable budget, and BiznessApps offers low-price subscription-based mobile applications.
Does your store have a mobile app? Are you thinking about developing one? Share your thoughts in the comments below.
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