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Loyalty to Resurrect Declining App Market

2017 is shaping up to be a tumultuous year for apps as US downloads dropped 20% YoY according to Nomura.

In the same study, they noted that the average American downloads less than 1 app per month, showing a steep decline in a market that saw frenetic and investment in previous years.

While the bubble may have burst on the app market in 2016, the good news is 2017 will bring many brands back to the drawing board on the purpose of their apps.

Given mobile web’s evolution in load times, personalization and customer experience, it has reduced the need for shopping apps and reduced the app market share. Mobile web also doesn’t require users to download and take up room on their home screen for something they may not use often.
Apps are about value, frequency and uniqueness. Retailers providing a normal shopping journey without interesting experiences, offers and journeys may see a quick increase in downloads, but there’s no long-term benefit. It’s a hollow logo on the home screen that will be deleted quickly.

But there is some hope for those retailers that failed in previous years. Loyalty-based apps have been successful in providing unique experiences with great value to customers.

There are a cadre of retailers that have tapped into loyalty within apps before the industry began losing customers to mobile web.

Here’s a quick look at a couple of successful apps that drive customer loyalty:

Under Armour App Suite:

Under Armour has the most-pervasive group of apps nobody knows they own. They have a cadre of fitness-related apps from MyFitnessPal, MapMyRun, MapMyFitness to Under Armour Record and even their retail app. Under Armour is dominating the fitness industry.
Through those apps Under Armour can collect vast amounts of data on their customers that’s essentially limited only by Under Armour’s ingenuity to harness it.

Each app also links back to UA Record which is where Under Armour loyalty comes full-circle. The retailer can drive brand loyalty through unique content like motivational feeds, sharing workouts and records, health tracking and of course product.

Sephora to Go

Sephora’s app is more of a true loyalty app with a built-in rewards dashboard that users can easily check for account updates, rewards and special offers. They also unveil new products every Tuesday and Thursday to drive return frequency. A daily content feed of beauty tips and makeup techniques, as well as a sophisticated ratings and reviews section gives consumers a reason to keep returning.

What’s most unique about the app is the ability to virtually try-on makeup by uploading pictures of yourself to see what colors and makeups might work best for each customer.

Walgreen’s

Walgreens app isn’t as sexy as glamorous as Sephora or Under Armour, but it’s no less effective in driving downloads and return visits.

The Walgreen’s app makes life easier, plain and simple. Refills are smooth with the app, just take a picture of the label, send it through and pick up your next order. Through beacons the app knows when you’re in-store and provides product information and offers. Users can even quickly print photos from the app and pick-up within the hour.

So, what do each of these three 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 your workout journey, Sephora through beauty, and Walgreens through health and convenience.

Overall, the decline of app downloads will provide a reality check for the market. It gives some retailers a chance to recreate their experiences to gain market share and become competitive again. Other retailers will flourish because of their ability to listen to their customers and provide a platform that activates loyalty through value and unique offerings.