Business Growth Through Mobile Apps
There used to be a time when building a mobile app was only feasible for big players and industry giants. Those days are over.
Today, it’s become much easier and accessible for smaller companies to build an app for their business.
Mobile usage has seemingly taken over our lives. People in the United States spend 5 hours per day on their mobile devices.
92% of those hours are spent on mobile apps, while just 8% is on web browsers.
This means that it will take more than just a mobile-friendly website for your company to have an effective mobile strategy. Businesses are realizing this, and acting accordingly.
In fact, 42% of small businesses already have a mobile app. An additional 30% of small business owners plan to build an app in the future.
There are more than 1.9 billion websites compared to 3.4 million unique mobile apps. By successfully launching an app for your business, you can still have an advantage over your competitors as an early adapter.
Mobile Apps Drive Growth
Mobile apps can help your business grow. I’m sure you’ve recognized this by now, which is probably why you’ve navigated to this guide.
But it’s possible that you’re not quite sure exactly how to stimulate that growth. This is something that I encounter all of the time when I’m consulting with business owners.
In business, you don’t always need to reinvent the wheel. Take advice from others who have succeeded before you.
We’ll show you eight different examples of how real companies used their mobile app to drive growth for their business. You can use these case studies as inspiration for your app development.
1. Generate new sales like Touch of Modern
Touch of Modern started as an ecommerce website.
When their website first launched back in 2012, it was the only way for their customers to purchase products. But the founders quickly decided to pivot their strategy and target mobile users.
That’s when they decided to build and launch their mobile commerce app. The year after the app launched they saw a massive growth from 30,600 orders to 131,000 orders.
Let’s put that into perspective for a minute here. Hypothetically speaking, we’ll say the average order value is $100 to keep it simple. That’s a $10 million increase in sales.
Today, 70% of total sales from Touch of Modern come from mobile devices. Two-thirds of those mobile sales come from their app.
57% of purchases come from repeat customers. Their customer retention strategy is clearly working. But that’s not stopping them from acquiring new users.
They still get about 150,000 – 200,000 new app downloads each month.
With their download numbers continuing to rise, and such a large percentage of sales coming from the mobile app, Touch of Modern will continue growing in the future.
You can apply this same growth strategy to your ecommerce business. Use your app to sell products.
Having a mobile-friendly website is necessary, but you’re just barely scratching the surface with those sales. Just look at the difference between mobile browsers and mobile apps.
Apps clearly outperform mobile browsers in every category.
Furthermore, the average retail order is $10 higher on mobile apps compared to mobile browsers. This means your customers will spend more money, and convert at a higher rate once your app launches, which posies your company for growth. The reason why this strategy works is that mobile apps eliminate friction in the checkout process.
Customers can store their payment methods and shipping information, which allows them to check out in just a few clicks.
Touch of Modern also runs daily deals. Other ecommerce businesses with a similar strategy would highly benefit from launching a mobile app.
So if your business sells products online, you can build an app to drive additional sales.
2. Increase customer retention like Starbucks
Developing a mobile app will instantly enhance the customer experience. As a result, it will be much easier for you to improve your customer retention rates.
Starbucks uses their app to increase retention and drive sales at the same time.
The reason why they are so successful in doing this is because every element of the app focuses on the customer experience.
One of the best features is their mobile payment option through the app. Users can store their payment information, so when they make an in-store purchase, they don’t have to physically take out cash or any credit cards.
This checkout process is fast and convenient for their customers.
Furthermore, the app allows users to place to-go orders from their mobile devices. Then their stored payment method will be charged automatically.
These orders are waiting for the customer when they arrive, so they don’t have to stand in line and don’t even have to take out their phones to pick up their coffee.
30% of transactions made at Starbucks come from mobile payments. 11% of orders get placed in advance through the app.
In Q1 2018, Starbucks generated $6.1 billion in revenue. With 30% of those transactions coming from mobile payments, they’re on track to generate $7.32 billion from their app annually.
Check out this graph that illustrates their company growth with the mobile app.
Customers have accepted this technology and want to use their mobile phones to pay for orders. This gives them a reason to keep coming back to Starbucks instead of going elsewhere for their coffee.
But it doesn’t stop there. Their app users spend more money than the rest of their customers.
The average Starbucks mobile order is roughly 3x higher than a traditional purchase.
Customers who use the app to make purchases get rewards for their spending based on a star-rating system. They get perks like free drinks, free refills, and drink upgrades.
App users also get the benefit of complete customization. Their platform makes it easy for customers to customize their drinks exactly how they want them.
People with the Starbucks app have the ability to send gifts to other app users, view previous purchases, and manage their account balances as well. All of this is tracked in the app.
Starbucks loyalty rewards customers accounted for 36% of their total sales in 2017.
Your mobile app is a great way for you to implement a new loyalty rewards program for your customers to improve retention rates.
3. Improve operational efficiency like Preferred Materials
Mobile apps aren’t just used for targeting customers. You can use an app to help your business with in-house operations, communication, and help reduce costs.
This is much more efficient. The app makes things easier for their employees and all the HR department to spend time and resources on other tasks to make the business better.
Low employee engagement can be costly. Let’s put this concept into numbers to show you what I mean.
Hypothetically speaking, let’s say an average worker at your company makes $4,000 per month. But they aren’t engaged 30% of the time. That one person is costing you $14,400 annually. If you have 100 employees, this operational efficiency is costing you $1.44 million each year. On the flip side, engaged employees yield a high ROI.
Research shows that businesses with highly engaged employees have double the net income compared to companies with low engagement rates.
That’s right. You can potentially double your revenue by fixing these types of inefficiencies.
Furthermore, brands with high employee engagement grow profits up to three times faster than their competition. This makes sense, considering these employees are 87% less likely to leave the company.
If your business currently has some operational inefficiencies, a mobile app can solve those problems and set you up for growth.
4. Make money in the app store like Spotify
Let us start off right away by saying we wouldn’t expect your company to be the next Spotify.
That’s probably unrealistic for most of you. But with that said, their business model is proven and can work for tons of different businesses across any industry.
Build an app to drive conversions for your subscription business model.
Subscription apps offer premium content. You can charge different rates based on the type of content you’re offering at each level. Your most basic tier can even be offered for free. Allow your app users to try out your premium services with a free trial. Ultimately, this will help you drive more conversions.
An average, 60% of free trial users will convert. Once you set up your app for subscriptions, it’s an easy way to increase revenue streams and grow exponentially. With a user credit card that gets charged on file each month automatically, your conversions and retention rates will be high.
Spotify used this model to grow their business to 170 million monthly active users.
It’s a common misconception that you need to charge users to download your app to make money in the app store, but that’s simply not the case. Spotify is proof of this.
Users can download their app for free, and upgrade to a paid subscription based on the type of personalized content they want.
Spotify converts 27% of their free trial customers. Their retention rates are high as well.
That’s why have had so much growth in paying customers over time.
As you can see, you don’t need to charge for downloads to make money in the app store.
While you may not become the next Spotify, it’s not unreasonable for you to apply their business model to your company. It works even on a smaller scale.
Timeline and Cost to Build an App
Some common misconception about mobile app development is that they take too long to build and they are very expensive. That’s not always true.
Traditional development isn’t always the best option. With this method, you’ll have to build two separate apps; one for iOS users and another for Android users.
Paying someone a high hourly rate to develop two separate apps is a long and expensive process.
But the Appily App Builder rapid development framework allows you to build an app in just a fraction of the time compared to traditional development.
There are lots of different ways to drive growth with an app. Just look at the examples above.
All of these businesses and apps are very different. Companies built these apps for different reasons, but ultimately, they were all able to grow as a result.
We think it’s definitely safe to say that it's worth it to build a mobile app for your business.
You don’t need to spend a year of your time or an outrageous amount of money to make this happen. As you’ve learned from this guide, it’s possible to build an app that gets over 5 million downloads in just two weeks.
But you’re going to need some help. You don’t need to hire an expensive developer that’s going to be forced to build two versions of your app for each platform.
In addition to the cost, this is just too time-consuming. You’re better off looking for an alternative app development strategy.
Appily App Builder has launched over 7,000 mobile apps for businesses. These apps range everywhere from Fortune 500 companies to entrepreneurs with startup companies.
Cumulatively, we’ve saved our clients over $150 million in development costs.
For the past 5 years, We have lived, breathed, studied and practically spent every minute And spent $1,500,000+ to build this platform.
We’ve built apps for industry-leading brands.
Obviously, we know that we're a bit biased, but our rapid app deployment framework works.
It doesn’t matter what industry you’re in, how big or small your company is, or what you’re trying to achieve from your app. Launching a mobile app will help your company grow.
Just follow the lead of the companies and case studies that we’ve outlined above in this guide.
You can start building your own custom mobile app today.
How are you planning to leverage your mobile app to drive growth for your business?