When Mobile Apps Drive Revenue (and When They Don’t)

Mobile apps are driving the e-commerce and online marketing worlds, and many companies are struggling to understand how mobile apps help them make money—or why they’re not.

With mobile apps driving most of the growth in online advertising, some are beginning to wonder if all of this money spent on apps is truly worth it.

The fact is that mobile apps can be game changers for companies, but many struggle and some ultimately fail because they do not know how to leverage their mobile apps and mobile properties to drive revenue. Yet there are three things that every company can do to make their mobile apps work for them no matter what.

Connecting to the Real World

Every successful mobile app somehow connects to the real world. The best companies realize that their mobile apps will not only drive e-commerce sales, but they can also drive in-store sales as well if they’re done well. The most successful mobile apps have transformed how people conduct business in the real world—Airbnb and Uber are the clear winners in this race.

But brick and mortar companies can benefit too. For instance, GameStop has used mobile apps to increase revenues, and they’ve been able to identify a 460% increase in in-store reservations from their mobile platforms, and that sales growth was only possible thanks to incorporating mobile and real-world assets.

Simple Shopping

A real-world connection is great, but mobile apps have to be easy too. A lot of e-commerce firms have been frustrated with heavy but poor converting traffic on mobile sites and pointless downloads that don’t turn into sales. They blame the media, their marketing departments, and the consumer, but they only have to blame themselves.

It is more cumbersome for users to input information on mobile devices than on desktop devices, which makes the old e-commerce shopping cart model a step backwards, not forwards. Mobile platforms need to optimize for easy transactions if they want to earn customers’ dollars.

Again, Uber and Airbnb are good at this. Amazon is great at this. Many e-commerce firms lack the scale or use case to make online registration easy, while others lack the strategy or focus. This is a hurdle that still needs to be overcome.

Leveraging Data

Finally, all app developers, brands, and retailers can use the mobile channel as a source of data and as a place to transform data into more sales. This is arguably the hardest part, and the least well understood.

There is a lot of data out there, a lot of studies, and a lot of assumptions about what works and what doesn’t. Much of this leads to confusion. What app developers need to do is constantly refine, perfect, and test their mobile platforms to see what works and what doesn’t work for them specifically. While cumbersome and seemingly pricey, this ad-hoc testing approach will yield more results.

The Mobile Challenge

Mobile apps are an opportunity and a challenge. They can drive revenue but don’t for many. The problem isn’t with the medium itself—the problem isn’t the small screen, or the lack of data, or the incompetence of consultants and marketing teams. The problem is a lack of strategy.

Those who take advantage of the best of the app world and spend serious time and investment in their mobile efforts will see huge results, just like GameStop, Uber, and Amazon. The rest will struggle to survive.