App Marketing Conversations: Holiday 2013 Recap
2013 Holiday Trends for Mobile Consumers – Sales Data Showing Rise in Mobile Commerce
In this installment of App Marketing Conversations we talked about consumer trends during the holiday season and the growth of mobile commerce. After the holidays, IBM released shopping data around how people are spending money with mobile devices. Mobile commerce is taking a larger percentage of online sales each year and companies not seeing increases through mobile devices should be focusing more heavily on mobile. Android continues to own the mobile market, but consumers with Apple devices are spending more money.
Take a look at the video from this week’s App Marketing Conversations to learn more.
So, in the previous installments, we’ve been sort of talking about what happened over the holidays, and stats that have come out. We want to do a little bit of a deeper dive on some stuff from IBM. They had a lot of shopping data around how people were spending money using mobile devices.
So, a couple things to highlight. They said they represented about 17 percent of all online sales, and that was growth of 46 percent over last year. So, mobile’s share of online sales grew tremendously, even though online sales themselves as a total bucket were growing really pretty healthily as well.
And then, sort of not surprising, Apple was much larger than Android. So, I think that the numbers are basically that Apple represented something like 12, 13 percent of the total, and Android was about 2 1/2 , 3 percent. And then, more importantly, the dollars spent from Apple devices were a whole lot more than Android.
$115 to, I think the number is $83 for Android in some of their studies. And then, if you cut the numbers up different ways, you come out with different absolute numbers. But in general, consumers with Apple devices were spending a lot more money than people with Android devices.
So, as you look as this stuff, Ryan, what do you take from it that’s most interesting?
Ryan: The thing that I think is most interesting goes back to our other topics about saturation not really mattering, in terms of where the growth of the market is going to be. I find Android and like this really sucks. But I also go “Well, there’s a lot of opportunity here,” right, because I still own the market from a pure market share percentage. So, they have a lot of room to operate and grow.
If I’m Apple, I’m really excited because I can now go build meaningful businesses around retail and commerce that Android can’t right. So, you can go into retailers and say, “Hey, I represent 15 percent of your mobile sales, or your total online sales. Let’s do some interesting things, if I leak in kind of all this other commerce-structure stuff that we can do that no one else can. And that kind of just creates the ecosystem login and platform login. That I think it will be hard for everybody to compete with.
Ryan: So I think – yes, that’s what I think is really interesting.
Robi: Got it, and what about for you? Is it the same thing, or is there something else?
Ian: Yeah, and I mean I agree with everything he said there. That the one thing that stuck out to me originally when I heard the stat was, I think 16 percent was the number, right, for overall percentage of online sales. Is thinking about who that is actually out sized for. Who is doing more than 16 percent?
And it wouldn’t surprise me to see like an eBay doing much more than 16 percent on mobile. I think eBay has done pretty well with mobile, especially if you were to add in PayPal. That, sort of to me, is not online sales.
Ryan: Thinking about that type of world. Obviously, the newer folks have done tremendously well. Fab, I think, most of the, depending on how you define Fab, is doing well right now. But Fab has done tremendously well on mobile.
Shopping app 1-ILO seems to be killing it in the App Store. So, not just the fact that overall, it’s at 16 percent. But the fact that there are pockets where it’s even higher is incredible to me.
Robi: Right, right, and I think, again, in every one of our segments, we’ve brought up Amazon, I think. The stats on Amazon’s mobile are really extraordinary. So, that’s another place where people are buying really quite a bit of stuff from Amazon directly through their mobile apps.
I did a number of times did this holiday season. It’s like, “Oh, this is something I’m going to buy. I’ll just do it now as I’m waiting for the bus.” Super convenient.
So, yeah. I think the overall number hides the extraordinary success some of the people are having underneath the covers. And that means, for an app marketer, you should be wondering why you’re below 16 or 17 percent if you are. What are you doing to actually boost that up and take advantage?
So, what we can give advice to marketers around using the mobile device to stay engaged with these customers, and get them to spend $120 with you?
Ryan: I don’t know whether I am the right person to be giving advice on any of that. But one of the other things that I read, which I found quite interesting was that, especially for clothing, people are two or three times more likely to buy using Touch-based devices versus PC.
Because for something about touching the shirt, or the pants, or whatever makes you more likely to buy it.
Ian: There’s a tactile, like the zooming of the images. That makes a lot of sense.
Ryan: The point I’m trying to make there is if you’re not making a mobile-optimized experience, either from a Web perspective, or even just an app perspective, and you’re trying to sell clothes, or things that people kind of touch, and feel as part of the experience with the actual product, you’re doing yourself a disservice. You need to do that now! Or a year ago, probably.
Ian: Yes. I think the two things that I think of when I think what advice marketers can pull from this first, is along that line which is…I mean not the vast majority, but a large percentage of eCommerce is through very small, independent, kind of crappy-looking websites, and things like that. And obviously, individually, they don’t make up a lot, but collectively they make up a good amount.
If those folks–and I think a wide margin of those folks have not yet implemented any sort of app strategy or mobile strategy at all. If they don’t, it’s going to be killed by the folks who do and come in with that. So, for them, I think they have to do it.
And then, the other piece of the puzzle is, I think, eCommerce, perhaps better than anybody else on the Web, has always done a great job of personalization, of targeting, of things like that. And whether that’s e-mail, or whether that’s the recommendation of a website, whatever it is.
And I think that stuff has to transfer to a mobile-focused orientation. Like, you have to port that to mobile in a way that’s friendly to mobile as well.
Robi: Yeah, absolutely. And in some ways, it’s easier on mobile. At least with phones, you can generally be assured that it’s one person using that device. Tablets have more sharing for sure. But like on PC, that assumption isn’t always there.
So, you get a lot of work to get people to register, and get them to log in on websites. And I think to a large extent, apps have less of that on the phone as a requirement. I still see a lot of apps that ask me to register the first time, and I think that that is generally kind of crazy.
Because to start with the assumption that that person is the owner of that phone. And if you want them to log in, show them some value later on. But you can personalize, already, just from having them use your app without them logging in and registering.
So, I think there’s a lot more opportunity on mobile to do that well.
It also seems like, because we were in the previous segment talking about television ads. Some of these premier brands that have been doing TV ads for years, if not decades, should be thinking about using those ads to engage their shopping base through the advertisement to get their app, to start spending money there.
Did you see…because we were talking about this, did you see any of these mainstream retailers talking about their apps?
Ian: Yeah, I think a lot have. And Macy’s has a lot of TV ads it’s just another app. Home Depot actually has a good amount of ads about their app as well.
It feels like there’s a solid traction there. And I know Target does a lot of ins, like part of Target’s app strategy is to really just be a companion to the in-store experience. So, they’re certainly doing some of that. Yes, I think a good amount are doing it.
Robi: Anything else we should cover on this topic? I think the general point is, thanks to IBM and their data, really quickly, lots of sales are happening through mobile devices. And if you were one of the companies that’s not seeing 15, 16, 17 percent of your online sales coming through mobile, it probably means, not the market hasn’t gotten there it’s just that you haven’t. You probably want to focus more on your mobile efforts and they’re best.
Ryan: It’s a little bit like SEO strategy and being held heavily reliant on Google search for your business. Because if you didn’t do it you were screwed. And we’re kind of almost at the point with mobile where, if you’re not doing it you’re screwed. You have to do it.
I think the numbers that I would like to see are what are the average sales for people on PC? If the average iOS user was spending $100, and Android was spending $80, or whatever it was. What is the average PC user spending? Because that’s…I’d be interesting to see that.
Ian: Yes. I don’t know if that 16 percent is percent of online sales revenue, or online sales numbers.
Ryan: Yes, because if it’s revenue and it’s 8 percent of numbers, then it’s like, “This is a totally different story than the one we thought.”
Robi: Yes. Good questions for sure. And if I find some of those answers, I’ll put them on the post. Great, well thanks for tuning in, be sure to “Like” this and share it. And check out the other installments this week and Happy New Year.