In: Mobile App Development

Growing your business is the number one priority on every entrepreneur’s bucket list. The main business growth elements are centered around market penetration, diversification, value proposition, solving problems, and development. 

In recent years, we’ve witnessed the rise of mobile apps. 

Mobile apps are no longer for the fortune 500 companies only. Small and medium businesses are catching up pretty quickly on this trend. 

With that said, how can a mobile app help you to grow your business? 

Generating New Sales

Generating sales is a significant challenge for most businesses. A recent survey conducted by Google indicates that 59% of shoppers say being able to shop on mobile is very important when deciding the brand or retailer to shop from. 

This shows that most shoppers prefer mobile shopping compared to using a desktop. Having a mobile app will enable you to target mobile users who are higher than desktop users. 

For example, Touch of Modern, an eCommerce business that focuses on lifestyle and fashion products, witnessed a massive growth from 30,600 orders to 131,000 orders the year they launched their mobile app. This is roughly over 100,000 more sales generated through their app. 

If we approximate one sale was valued at $10, they could increase their revenue generated by $1,000,000 by having an app. 

Today, 70% of Touch of Modern’s retailer’s sales are from mobile devices. Two-thirds of these sales are from app users. Additionally, they receive between 150,000 to 200,000 app downloads per month. 

Generating more sales equals business growth. From the above example, it is clear the impact an app can have on your sales. Having a mobile-friendly website isn’t enough anymore. 

Currently, most businesses rely on the sales funnel to increase their conversion rates. But, having high-quality mobile-friendly pages barely scratches the conversion rate surfaces compared to mobile apps. 

Apps have surpassed traditional web stores in terms of conversion rates. According to Criterion’s 2016 report, apps close more successful deals and convert 3 times higher than web shoppers. This is from product views, add-to-cart rates to checkout rates. 

Higher conversion rates translate to an increase in successful sales, which helps your company to grow. 

Repurposing Your Business

Rover, an app that helps dog owners find dog sitters, changed their model to an on-demand marketplace after launching its app. They offer dog walking, dog visits, doggy daycare, dog boarding, and house sitting. Initially, they had a website, but they wanted to improve the services offered via the app. 

The app made them expand to 11,000 cities, and they even saw a 200% increase in registration. They even had 10,000 people joining in a week. 

Through their mobile app, they could add and implement features that can work better on apps compared to websites. They noticed that most dog owners had concerns about the dog walkers not walking the full required distance. 

In their app, they added a feature that allows you to track your dog walker via GPS. This helped to ensure no one was cutting owners. In turn, it increased most dog owners’ preference for Rover because they feel more comfortable. GPS works more accurately with mobile apps compared to websites.

This, in turn, saw a surge in their revenue and gross bookings. They even have a growth strategy in Europe and other countries. 90% of customers who used Rover when the app was launching are still active up to date. Also, most of their retained customers recommended the app to their friends and family. 

You can also use Rover’s strategy via a mobile app to grow your business. They didn’t start a new business. Instead, they simply modified their existing ideas to suit their customers. 

An app can find a gap in your products or services and use it as a growth opportunity. For example, if you’re in a service-based industry, you can venture into on-demand marketplaces that are currently thriving. 

Discovering new business model

One common way of growing your business is by generating more income. You can use an app to diversify streams of income for your business by earning through app stores. 

The most direct way of earning from PlayStore or AppStore is by selling your app. But, that’s not advisable. If you want users to pick your paid app over free alternatives, you must create a high-quality app and offer premium services, which may make you incur unnecessary costs. And that’s not how you grow your business. 

You can earn money from an app by changing your business model. This is effective, especially for service-based businesses that operate on a subscription model. Offering multi-tier subscriptions will help you generate more revenue. 

Let’s take Spotify as our example. Spotify is in the audio streaming and podcast industry. Today, Spotify is ranked among one of the best companies and even among the fortune 500

How did Spotify do it? 

Spotify starts by offering customers a basic tier for free. They start by offering users a 30 day free trial period. After the free trial duration elapses, users can turn into paying customers by opting for their premium services at $9.99 per month. 

Through this model, Spotify has managed to grow to 170 million active users per month. Their freemium conversion rate is 27% of free trial users convert into paying customers, and their retention rates are pretty fair. 

2017 Marketing charts indicate subscription businesses’ free trials conversion rate has a 59.9% conversion rate. Thus, a mobile app can help you attract new customers and convert them through free trial periods. This is a great way to increase revenue, customer base and grow your business in general.  

Increasing Customer Retention 

Mobile apps enhance your customers’ experience. Once your customers are satisfied, it is easier to increase customer retention rates. 

For example, the Starbucks mobile app has made things 10 times easier for customers. Let’s look at their mobile payment option. Once you’ve paid through the app, you can store the payment details such that the next time you make an in-store purchase, you don’t have to use cash or a credit card. 

Also, through the app, customers can place to-go orders remotely. These orders are prepared in advance. When a customer arrives in the store, they don’t have to stand in line or use their phone.  

Additionally, their checkout process is very easy. This shows how the mobile app provides a first-class experience to Starbucks’ clients. Who would want to leave when all processes are these easy? 

Today, 11% of Starbucks orders are made through the app. 30% of their transactions were made via the app. Customers like the experience they get through the app, and they keep coming back. 

But, customers who place their orders via the app spend more compared to traditional purchases. Roughly, a Starbucks mobile order is 3 times higher. However, these customers also get several perks like free drinks, upgrades, and drinks. They can also customize drinks to fit their needs. 

This loyalty reward program accounted for 36% of their total sales in 2017. Therefore, through this, they can increase retention and sales at the same time. 

Having a mobile app will help your customers experience and even have a great loyalty program while generating more income at the same time. This forms the basis of customer retention. 

Statistics indicate 65% of a company’s business comes from existing customers. Hence, an app can be the beginning of a great customer retention rate coupled up with higher sales. 

Increasing Customer Shopping Frequency 

Today, shoppers prefer online shopping via mobile apps than through websites.

Asda, a British supermarket chain with more than 500 locations, increased its customer shopping frequency after launching an app. Their initial goal was to make shopping more convenient for Asda mums, their busiest customers, increase sales by 10% and increase functionality. 

Customer feedback indicated that Asda customers wanted a simple easy to use app. This resulted in creating an app with a locator, barcode scanner, and recipe finder. 

The app is a massive success with over 2 million downloads. 18% of all grocery shopping comes from mobile accounts, with 90% of this revenue from app sales. The best part is the app increased shopping frequency to 1.8 times higher than a desktop. 

Let’s circle back to Touch of Modern. According to the company’s COO (Chief Operating Officer), most of their customers are urban men who add products to a cart on the web but then checkout via the app. One of their main priorities is acquiring and maintaining app shoppers because they have a higher lifetime value and are more likely to make repeat purchases. 

Lifetime value is the total net profit generated from the long-term relationship between a business and a customer. From these examples, we can see how mobile apps increase customer shopping frequency.

An app will help you get valuable clients who are capable of making recurrent purchases. Through this, you can increase your customer retention rate. And a 5% increase in retention rate increases profits by 25% to 95%, which will grow your business. 

It doesn’t matter if you’re selling online or via a physical store. You can launch an app like Asda and Touch of Modern to increase customer shopping frequency and generate more revenue. 

Making Content Easily Accessible 

Apps make content easily accessible. This also works for businesses that don’t sell their products or services online. 

For example, let’s look at Marriott International, an American multinational hospitality company. After opening Gillray’s Steakhouse & Bar, they wanted to be unique, unlike other London brands. 

One of their key strategies was the inclusion of Gillray’s Steak & Gin app. Using this app, you can make a reservation, find out special offers of the day and week, use a timer when cooking steaks at home properly, and more. 

Their new steakhouse quickly increased in popularity by making their content open and readily available via their mobile app. Over 60% of the Marriott users return to the Gillray app with average access of 11 screens per visit. What does this mean? Marriott was able to grow its customer engagement rate through the app alone tremendously. 

Another example is the Shopwell app, which simplifies nutrition and helps users find new healthy foods near you. You can create a food profile with your weight goals, health concerns, dietary plan, allergies, and dislikes, and the app will help you determine the food that matches your needs. 

It even helps you get the right food from the grocery store. In 2015, the Shopwell app had more than 2 million downloads. Most people can’t walk around with a comprehensive list of what they can and can’t eat, but they will have their phones with them. 

By Shopwell allowing users to access this information quickly, they have garnered an enormous following. Today it is ranked as one of the best lifestyle apps. 

From the two examples, it is evident you can increase your numbers and visitors by offering free content. You can even use this information to sell your product subtly. 

Final Thoughts 

A mobile app can grow your business in several ways. From generating new sales, increasing income, expanding your customer base to diversifying your earnings. It doesn’t matter whether you deal with physical products or run a service-based business. With the right strategies, a mobile app can revolutionize your business. 

Before settling on an app, consider your customers and business’s nature, and what you want to achieve. Also, remember that customer experience always comes first. Therefore, the easier your app is to use and the bigger the problem it solves, the higher your chances of growing your business. 

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