Will 'App-Only' Be The New Normal In E-Commerce?

by Sohini Bagchi    Jul 08, 2015

app

E-commerce major Flipkart is following the footsteps of its online fashion store Myntra and is soon going for an app-only strategy. A number of other Indian e-commerce firms are also likely to close down their mobile websites in the coming months. Experts believe with the number of smartphones and mobile Internet users growing phenomenally, an app-only strategy is set to become the new normal soon.

However, why are these e-commerce firms showing an interest in an app-only strategy and how can they remain profitable by alienating themselves from websites is something to ponder over.

Next level of growth

“One obvious way for e-commerce firms is to streamline their spending on technology,” says Gaurav Kumar, tech analyst, who has been observing the online commerce growth in emerging market, who believes that there are a lot of other benefits as well. He states that the engagement on mobile apps is many times more, which translates into greater sales.

Say in case of Myntra, CEO Prasad Kompalli, told NDTV Gadgets in an interview that mobile apps are the best platform for as they allow you to integrate with contacts, calendar, and camera, which can be used to improve the user’s experience.

Flipkart’s chief product officer Punit Soni says the mobile app approach aims to create a personalized shopping experience, by taking stock of the user’s location, preferences and purchase patterns. 

Likewise Flipkart’s biggest rival Snapdeal, which is no longer available on an iPad but is still running on Android may follow suit. Sites such as Jabong, OLX, Zomato and Quikr among others are also prompting users towards downloading the app on their webpage.

For companies like Flipkart and Myntra, its about moving to the next level of growth. Thinking of the long term prospects, they should be concentrating all its energies on the apps at the moment, believe experts.

Not all’s well

Going ‘app only’ can benefit the e-commerce companies in several ways. As social media strategist Aparupa Patowary mentions, “In an app-only approach, the bounce rates are low. The platform is also more effective for social media marketing and translates into more revenues.”

However, she believes it’s not all good news for users as they are left with no comparison on price and availability as they could on a desktop or mobile site by opening several windows. This can help companies get important consumer insight from them based on their preference and buying pattern, so that they can push you new product or service.

Likewise, management consultant and avid online shopper Payel Banerjee regrets, “An app-only” strategy can hit the consumer’s psychology, especially in a country like India where e-commerce itself has just started to mature and people are only beginninng to get get used to it.

Moreover, loading half a dozen apps can put your phones at risk – most people do not have very costly phones in the country which would not support all the apps, believe some. Apart from that things like privacy and security may also hinder its adoption.

A long-term strategy

Others however believe that gradually every e-commerce firm has to take the app route to reduce cost and complexities. Christopher Klotzbach, Head of Product Marketing at Flurry, the Yahoo-owned mobile analytics firm justifies at a recent Mobile Developer event, “If you want to provide the best experience for the user then it makes sense to focus on one thing and that’s apps.”

He believes that with increasing usage of phablets, rise of m-commerce and diversification of apps, the time is right for developers to leverage this appetite for apps and lead the curve.

To sum up, one can say, app-only is the way ahead for e-commerce. According to a CA Technology report, the app-driven economy has been predicted to surpass $80 billion just two years - a three-fold increase from now.

As Kenneth Arredondo, President & General Manager, Asia Pacific & Japan at CA Technologies explains that the application economy is presenting huge opportunity for enterprises across segments to innovate and grow - and e-commerce will be one of the key and early sectors to make this transition.