By Ben Lee
Ecommerce is one of the hottest spaces in the digital business industry today, with scores of online merchants launching and growing profitable new businesses every year. Powerful tools like Shopify and Squarespace have made it easier and ever for an entrepreneur to get a store up and running and start selling product, and integrations with Facebook and Instagram allow ecommerce businesses to harness the unbridled power of selling through social networks.
But eventually, there are limits to keeping a store solely within the confines of a web browser. With consumers spending more time on mobile devices and increasingly comfortable with making purchases on mobile, developing a mobile app can be an attractive prospect for a growing ecommerce business.
From a business standpoint, a dedicated mobile app can offer a variety of new capabilities and benefits. Mobile apps allow you to engage customers on a deeper level, building stronger customer relationships and allowing access to a suite of features that can help retain existing customers, encourage repeat purchases, and tap into brand new markets. But it’s not all upside: mobile apps come with drawbacks, as well. If you’re thinking about building a mobile app for your own ecommerce business, here are a few factors you should consider in evaluating the decision.
The Pros of Building an App for an Ecommerce Business
For an ecommerce store at the right phase in its lifecycle, a mobile app can be a powerful way to supercharge the business and unlock a new level of growth.
For starters, mobile apps let you reach customers on mobile where they’re already spending the majority of their time. Consumers spend about 85% of their time on mobile within apps, and if your store’s only touchpoint is through a traditional website, it’s inherently more difficult to capture that time. Chances are, your customers are more comfortable using a mobile app than they are using a mobile web browser. Building an app for your store lets you interact with customers where they already are.
In the same vein, mobile apps can dramatically improve customer retention. If a customer expends the time and effort required to download your app, chances are they’re already loyal to your business – and having a dedicated touchpoint stored on their phone’s home screen will only increase that loyalty. This helps build a stronger relationship between you and your customer, helping to solve the crucial problem of turning one-time buyers into repeat customers.
Furthermore, mobile apps provide much richer functionality for engaging your customers than traditional websites and emails. Push notifications let you alert customers of relevant sales and special offers in real time, giving you a new tool to incentivize buyers and create demand. You can also access data like timezone, location, and language preferences, giving you even more power to create relevant, timely outreach and offerings.
But perhaps the most enticing aspect of mobile apps for ecommerce is the ability for personalization. With a dedicated mobile app, you can collect and store individualized data for each customer, improving your ability to provide a personalized experience. But this goes beyond product recommendations based on past purchases. With a mobile app, you can track metrics as specific as pages visited, time spent on the app, and even the time of day that a customer normally opens your app. You can then use this data to create personalized sales and precisely-timed push notifications, allowing you to – very literally – sell to each customer individually and uniquely.
With a dedicated mobile app, you can reach new demographics, increase customer loyalty and retention, and engage your customer base on a deeper, richer level than through the web alone. But mobile apps aren’t an unmitigated good: they also come with their drawbacks.
The Cons of Building a Mobile App for an Ecommerce Business
On a certain level, adding a mobile app to your ecommerce ecosystem can run the risk of dilution. The extra outlet complicates the buying relationship, and if the UX of the app is less than stellar, it could even tarnish your brand. A mobile app may also confuse customers depending on your target demographic. But for the most part, the benefits of a mobile app outweigh these problems.
The real drawback to building a mobile app is the costs involved. While development costs can vary drastically depending on the features involved, most apps cost at least $100,000 to build. And for ecommerce apps, which often require extensive feature lists and back-end development, that price tag is likely to be even higher.
App development can also be a long process. Developing an app usually takes at least 4 to 6 months, and that’s excluding the work that needs to take place both pre- and post-development. Eclipse, Xamarin, and other mobile app development tools can speed up the process, but any high-quality app will still take months to develop. And for feature-heavy ecommerce apps, you can expect to be on the longer side of that time frame.
If that sounds like a lot, keep in mind that initial development is only half the battle. Even once your app is live, you’ll need to continually test and update it, fixing bugs, pushing new features, and making sure your app runs smoothly as new iOS and Android versions come out.
This means an ongoing commitment of both time and money to maintaining and improving the app. On average, you should expect to spend around 20% of your development budget on maintenance each year. For an app that cost $100,000 to build, that means committing to an annual expense of $20,000 to keep everything up and running. And unless you’re building the absolute bare minimum for your app, you could easily be looking at an annual maintenance budget of $40 or $50,000.
Make Sure It Makes Sense for Your Business
If you’re at the right stage of growth, the benefits your reap in terms of new revenue could easily outweigh these costs – but it all depends on your business. For smaller ecommerce stores or those just starting out, building an app could well be an unnecessary expense that nearly bankrupts your company.
As I tell all my clients at Rootstrap, what matters is understanding why you want to build an app in the first place and how it will further the larger objectives of your business.
Are you still trying to validate your product offering and attract initial customers to create sustainable revenue? If so, chances are you’re better off focusing on your online store and putting your efforts into more traditional growth channels.
But if you’re already operating a thriving ecommerce business and are looking to take it to the next level, building a mobile app could be exactly what you need to scale. For an ecommerce entrepreneur looking to build an empire, a mobile app could well be the next great frontier.
Ben Lee is a tech influencer and cofounder of Rootstrap, a digital studio that’s helped launch more than 500 products.