blue hill apteligent mobile retail and retail banking webinar

Blue Hill Research

Building Effective & Profitable M- Commerce Apps 2016

Timing is Everything - Seasonal Mobile & Digital Commerce Trends and Beyond

Tony RizzoEntrepreneur-in-ResidenceMobile & IOT Enterprise Research

Effective & Profitable M- Commerce AppsSuccessfully Extending the Mobile Enterprise

2016

New 18 page mobile retail shopping report based on research conducted by Blue Hill Research utilizing Apteligent-provided global

mobile app and mobile platform data

Effective & Profitable M- Commerce AppsThe Intersection of User and Mobile App Ecosystems

2016

AB C

C Retailer User Demographics & Mobile Shopping App Behaviors

• Mobile device types and behaviors• Operating system platforms and long/short term behaviors: adoption rates, app

load rates, crash rates, abandonment rates• App latency and responsiveness, data error rates

A Global Retail Mobile User Demographics• Age Groups (Millennials, Gen Xers, Baby

Boomers)• Mobile App Preferences and Desires• Mobile Device Choices• Actions each age group is likely to take

collectively and separately based on mobile shopping app qualities and attributes

B Aggregate Global Mobile Ecosystem Behaviors

• Mobile device types and behaviors• Operating system platforms and long/short

term behaviors: adoption rates, app load rates, crash rates, abandonment rates

• App latency and responsiveness, data error rates

• Geolocation-based behaviors

Effective & Profitable M- Commerce Apps

All Data Sets are Critical for Successful Mobile AnalysisThe data and information contained within each circle or within the intersection of any two circles is insufficient to build highly effective and desirable mobile retail shopping apps

All Data Sets are Critical to Evaluate Mobile BehaviorsIt is critical for retailers to evaluate all internal user demographic and app behavior and performance data with global user demographics and aggregate global mobile app and mobile platform behaviors

The Highly Successful Mobile Retail Shopping App Exists at the Intersection of All Data Sets

Global Retail Mobile User

Demographics

Retailer User Demographics & Mobile Shopping

App Behaviors

Aggregate Global Mobile Ecosystem

Behaviors

Retail Mobile User DemographicsIt’s Mostly a Young Person’s Game

216

Do you shop and make purchases and/or do shopping research through downloaded mobile store apps if they are available?

Older Baby Boomer (59+)

Younger Baby Boomer (51-58)

Gen X

Millennial

0% 10% 20% 30% 40% 50% 60% 70% 80%

76%

54%

41%

32%

24%

46%

59%

68%

YesNo

Percentage of Respondents

Source: Blue Hill Research and Apteligent, January 2016


2016

Approximately what percentage of your shopping and shopping research is done through mobile apps?


Millennial Gen X Younger Baby Boomer (51-58)


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

22%32%

50%

61%45%

47%33%

28%20% 13% 14% 7%12% 7% 3% 4%1% 1% 1%

I do not use Mobile Shopping Apps 25% or less 50%75% 100%

Perc

enta

ge o

f Res

pond

ents

65% of Millennials & 60% of Gen Xers Do 25% to 50% of Their Shopping via Mobile

Devices –TODAY!


2016

If a shopping app is a delight and highly effective, I will recommend it


Millennial

Gen X



0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

12%

16%

26%

44%

4%

10%

6%

11%

14%

22%

20%

14%

34%

24%

26%

13%

36%

28%

21%

19%

1-2 3-4 5-6 7-8 9-10Scale of 1 to 10, 9 & 10 Being “Most Likely”


2016

If a shopping app is a delight and highly effective, I will increase my mobile shopping


Millennials

Gen X



0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

14%

20%

30%

46%

7%

13%

8%

13%

18%

28%

19%

18%

30%

22%

24%

11%

32%

17%

19%

12%

1-2 3-4 5-6 7-8 9-10Scale of 1 to 10, 9 & 10 Being “Most Likely”

Retail Mobile User DemographicsMillennials are the Key to Retail’s Mobile Future

2016

Millennial Actions Retail Leaders Benefit Retail Laggards Suffer70% of Millennials will likely or very likely recommend highly delightful mobile shopping apps and experiences

Retail leaders continue to gain visibility and mobile market share at the expense of competitors

Inherent loyalty makes it nearly impossible for retail laggards to engage or re-engage consumers

62% of Millennials will likely or very likely increase their mobile-based shopping and consequently their mobile retail dollar spend

Retail leaders can reasonably anticipate both continued audience and - most important - continued top line revenue growth via mobile apps

The gap between retail leaders and laggards will dangerously widen for laggards and will put their businesses at significant short and long term risk

Retailers must view the experiences their mobile shopping apps deliver to Millennials within the context of traditional brand attributes – trust, competence, good will, quality, transaction satisfaction and security, to name but a few…

Millennials are unique among all age groups in that they fully embody living most aspects of their lives through their mobile devices…as they become the “older” next generation in a few short years, mobility will necessarily drive the entire retail value chain

Retail Mobile User DemographicsMillennials are the Key to Retail’s Mobile Future

©2016 Blue Hill Research. All Rights Reserved.

Retail Mobile User DemographicsGreat Apps are the Foundation of Retail Mobility

Mobile Shopping Apps - Crashes and Poor App Response, All Age Groups (Scale of 1 to 10, 10 Being “Most Likely Action”)


012345676.62

5.91

4.41 4.04 3.99 3.62 3.49

App crashes, poor performance and poor mobile shopping experiences reflect directly on retailers’ global

brand attributes and will significantly harm the retail brand


Retail Mobile User DemographicsGreat Apps are the Foundation of Retail Mobility

Mobile Shopping Apps - Desired and Critical Features, All Age Groups (Scale of 1 to 10, 10 Being “Most Desired”)


0

2

4

6

87.62 7.13 6.84 6.75 6.46 6.37 6.23 5.96

Highly positive mobile experiences will drive brand loyalty and the desire of mobile shoppers – regardless of their

age groups, but Millennials in particular – to recommend not only the mobile shopping apps but the retail brands

behind the apps as well


The Aggregate Global Retail EcosystemThe Larger Mobile Shopping App Ecosystem

Key Mobile Ecosystem Metrics & Data for Visualization & Analysis• Long and short term mobile operating system behaviors

– OS crash rates– OS adoption and abandonment rates– OS and app latency rates (a function of both internal app design and

wireless carrier services)– Data error rates

• Geolocation-based app uploads and operating system usage• Mobile app upload rates – all apps and specific apps (e.g. shopping apps)• Mobile app upload rates by operating system and/or device types• Mobile app abandonment rates

NOTE: All presented data is for Android and iOS. Windows Phone, Windows 10, BlackBerry OS and all other mobile operating systems data is available as well.


The Aggregate Global Retail EcosystemAndroid App Crash and Abandonment Rates

Total Android Daily Average Users (in millions) by Crash Rate Buckets, December 2015


0.25 0.5 0.75 1 1.5 2 2.5 3 3.5 4 4.5 50

5

10

15

20

25

30

35

40

45

All AppsShopping Apps

Daily Crash Rate Buckets

Tota

l And

roid

Dai

ly A

vera

ge U

sers


Android users are highly tolerant of app crash rates that do not exceed an

average of .25% per day. When crash rates double to .5% just over a third of Android users continue their tolerance. Beyond that you lose your audience.

Shopping app users show similar patterns at .25% but usage drops

dramatically beyond this.

The Aggregate Global Retail EcosystemiOS App Crash and Abandonment Rates

Total iOS Daily Average Users (in millions) by Crash Buckets, December 2015


0.25 0.5 0.75 1 1.5 2 2.5 3 3.5 4 4.5 50

2

4

6

8

10

12

All AppsShopping Apps

Daily Crash Rate Buckets

Tota

l iO

S Da

ily A

vera

ge U

sers


Apple users are perhaps surprisingly more tolerant of app crash rates

than Android users.This strongly suggests that Apple users will provide retailers a small

window of opportunity to understand that their app crash rates

are unacceptable and a small window of opportunity to fix them.

The Aggregate Global Retail EcosystemComparative iOS and Android Crash Rates

Crash Rate by OS Version


5/1/2

014

6/1/2

014

7/1/2

014

8/1/2

014

9/1/2

014

10/1/2

014

11/1/2

014

12/1/2

014

1/1/2

015

2/1/2

015

3/1/2

015

4/1/2

015

5/1/2

015

6/1/2

015

7/1/2

015

8/1/2

015

9/1/2

015

10/1/2

015

11/1/2

015

12/1/2

0150

0.5

1

1.5

2

2.5

3

3.5

4

4.5

iOS 7iOS 8iOS 9All Android

Timeline by Month, 5/1/2014 - 12/31/2015

Cras

h Ra

te


Android has made significant strides

towards providing a stable OS. However, the release of iOS 9

ensures Apple of continued bragging rights to stability.

The Aggregate Global Retail EcosystemApp Loads and OS Adoption Rates: Android

Percentage of Total App Loads by OS Version - Android


5/1/1

4

5/23/1

4

6/14/1

4

7/6/1

4

7/28/1

4

8/19/1

4

9/10/1

4

10/2/1

4

10/24/1

4

11/15/1

4

12/7/1

4

12/29/1

4

1/20/1

5

2/11/1

5

3/5/1

5

3/27/1

5

4/18/1

5

5/10/1

5

6/1/1

5

6/23/1

5

7/15/1

5

8/6/1

5

8/28/1

5

9/19/1

5

10/11/1

5

11/2/1

5

11/24/1

5

12/16/15

0

20

40

60

80

100

120

Android 4Anfroid 5Android 6


Perc

enta

ge o

f App

Load

s


Android users are not quick to upgrade to the

latest versions of the OS. Android v5 took six months to slowly overtake v4. The

recently released v6 will take longer to gain any

non-trivial market share.

The Aggregate Global Retail EcosystemApp Loads and OS Adoption Rates: iOS

Percentage of Total App Loads by OS Version - iOS


5/1/1

4

5/22/1

4

6/12/1

4

7/3/1

4

7/24/1

4

8/14/1

4

9/4/1

4

9/25/1

4

10/16/1

4

11/6/1

4

11/27/1

4

12/18/1

4

1/8/1

5

1/29/1

5

2/19/1

5

3/12/1

5

4/2/1

5

4/23/1

5

5/14/1

5

6/4/1

5

6/25/1

5

7/16/1

5

8/6/1

5

8/27/1

5

9/17/1

5

10/8/1

5

10/29/15

11/19/15

12/10/1

5

12/31/1

50

10

20

30

40

50

60

70

80

90

100

iOS 7iOS 8iOS 9


Perc

enta

ge o

f App

Load

s


Adoption rates for new versions of iOS are

remarkably different than Android’s. Adoption of new

releases of iOS is rapid – Apple is not fibbing!

Crossover happens within a matter of 4 to 6 weeks.

Should retailers care about this in 2016?

The Aggregate Global Retail EcosystemApp Loads and Device Adoption Rates: Samsung

Percentage of Total App Loads by Samsung Android Device


5/1/2

014

5/29/2

014

6/26/2

014

7/24/2

014

8/21/2

014

9/18/2

014

10/16/2

014

11/13/2

014

12/11/2014

1/8/2

015

2/5/2

015

3/5/2

015

4/2/2

015

4/30/2

015

5/28/2

015

6/25/2

015

7/23/2

015

8/20/2

015

9/17/2

015

10/15/2

015

11/12/2

015

12/10/2015

0

10

20

30

40

50

60

Samsung Galaxy S5Samsung Galaxy S6Samsung Galaxy S6 EdgeSamsung Galaxy S6 Edge+All Samsung devices


Perc

enta

ge o

f App

Load

s


As of December 31, 2015 Samsung Galaxy S5

devices still dominate overall Samsung device usage. Samsung Edge

devices have clearly not gained any traction.Should retailers care about this in 2016?

The Aggregate Global Retail EcosystemApp Loads and Device Adoption Rates: Apple

Percentage of Total App Loads by Apple iOS Device


5/1/2

014

5/27/2

014

6/22/2

014

7/18/2

014

8/13/2

014

9/8/2

014

10/4/2

014

10/30/2

014

11/25/2

014

12/21/2

014

1/16/2

015

2/11/2

015

3/9/2

015

4/4/2

015

4/30/2

015

5/26/2

015

6/21/2

015

7/17/2

015

8/12/2

015

9/7/2

015

10/3/2

015

10/29/2

015

11/24/2

015

12/20/2

0150

10

20

30

40

50

60

70

80

90

100

iPhone 5iPhone 6iPhone 6 PlusiPhone 6SiPhone 6S PlusAll Apple Devices


Perc

enta

ge o

f App

Load

s


As with iOS itself Apple users are relatively quick to upgrade to new devices. iPhone 6 users

surpassed all iPhone 5 users just before the holiday

shopping season kicked in. Big screens now dominate the

iPhone landscape. Should retailers care in 2016?

The Aggregate Global Retail EcosystemGeolocation Insights: Android Network Traffic

Source: Blue Hill Research and Apteligent, January 2016©2016 Blue Hill Research. All Rights Reserved.

The Aggregate Global Retail EcosystemApp Latency for Shopping Apps: Android

Number of Android Shopping Apps per Latency Bucket


100 200 300 400 500 6000

5

10

15

20

25

2

20

14

8

5

1

Latency Buckets (in Milliseconds)

Num

ber o

f And

roid

App

s


The Aggregate Global Retail EcosystemApp Latency for Shopping Apps: iOS

Number of iOS Lifestyle and Shopping Apps per Latency Bucket


200 300 400 500 600 700 800 900 10000

5

10

15

20

25

30

35

6

2421

29

4 4 5

1 1

Latency Buckets (in Milliseconds)

Num

ber o

f And

roid

App

s


The Aggregate Global Retail EcosystemLifestyle and Shopping App Adoption Rates: iOS

Percentage of iOS App Loads, Lifestyle and Shopping Apps


5/1/2

014

5/25/2

014

6/18/2

014

7/12/2

014

8/5/2

014

8/29/2

014

9/22/2

014

10/16/2

014

11/9/2

014

12/3/2

014

12/27/2

014

1/20/2

015

2/13/2

015

3/9/2

015

4/2/2

015

4/26/2

015

5/20/2

015

6/13/2

015

7/7/2

015

7/31/2

015

8/24/2

015

9/17/2

015

10/11/2

015

11/4/2

015

11/28/2015

12/22/2015

0

2

4

6

8

10

12

App Store Lifestyle CategoryApp Store Shopping CategoryLifestyle + Shopping


Perc

enta

ge o

f App

Load

s


Mobile shopping apps matter a great deal.

Following Apple’s creation of a pure

shopping category App Store shopping app

uploads clearly spiked during the 2015 holiday

shopping season.

The Aggregate Global Retail EcosystemShopping App Adoption Rates: Android

Percentage of Android App Loads, Shopping Apps


5/1/1

4

5/21/1

4

6/10/1

4

6/30/1

4

7/20/1

4

8/9/1

4

8/29/1

4

9/18/1

4

10/8/1

4

10/28/1

4

11/17/1

4

12/7/1

4

12/27/14

1/16/1

5

2/5/1

5

2/25/1

5

3/17/1

5

4/6/1

5

4/26/1

5

5/16/1

5

6/5/1

5

6/25/1

5

7/15/1

5

8/4/1

5

8/24/1

5

9/13/1

5

10/3/1

5

10/23/1

5

11/12/1

5

12/2/1

5

12/22/1

50

10

20

30

40

50

60

70

80


Perc

enta

ge o

f App

Load

s


Android shopping apps spiked non-trivially in the latter half of

2015. In Android’s case the spike occurred well ahead of the holiday shopping season.

Why?Additional correlations are

needed to answer the question. Is it related to the

release of Galaxy S6 devices?

The Aggregate Global Retail EcosystemWhat’s Missing?

Global mobile demographics and mobile app/platform metrics provide the critical framework for how retail teams – especially LOB and marketing teams – need to strategically and tactically invest their resources and think about both today and tomorrow.

But…the far greater value for this analysis requires visualizations and analysis of the same data presented here customized for every individual retailer’s mobile ecosystem and measured against the global aggregate mobile data.


Know Your Data…Know Your Mobile Shopping Apps!

How do your specific mobile shopping apps compare to and perform against aggregate market behavior – both over time and for specific (e.g. holiday) segments of time? Do they…

• Honestly outperform – creating strategic advantages• Maintain an average performance – tactically ok but strategically

harmful• Underperform – creating both strategic and tactical

disadvantages that will very likely lead to business failure

It’s impossible to know without specifically capturing the consumer and mobile metrics data shown here specific to any given retailer

Effective & Profitable M- Commerce AppsSome Quick Conclusions



01 02 03 04

Know All of Your Audiences

All age groups are vital to retail but Millennials are already today’s most active and proactive retail group

Millennials are Mobile Retail’s Present & Future

Meet the needs of all age groups but cater most specifically to Millennial demands…today

Build Amazing Mobile Shopping Apps

A retailer’s mobile shopping apps are the foundation for the entire retail value chain

Finally…

Know Your Data…Know Your Mobile Shopping Apps!



The Fundamental Mobile Retail Truth

“The Intersection of User and Mobile App Ecosystems” isn’t a slogan – it’s the necessary real world strategy to retail success.

A deep understanding of both short and long term aggregate global and local mobile ecosystem behaviors and their interactions is the bedrock on which the foundation of retail mobile apps must be built.



THANK YOU!

Tony [email protected]

2016

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