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‘App & Mortar Economy’ on Tap

20 Feb, 2013 By: Doug McPherson

SAN FRANCISCO – A new report says the “app & mortar” economy has arrived because the retail industry “is colliding” with the mobile app economy. The report, from Flurry Analytics, says two-thirds of the U.S. gross domestic product is from retail consumption, but that mobile is quickly gaining major ground.

IBM reports that more than 18 percent of shoppers used a smartphone or tablet to access a retailer’s website on Cyber Monday in 2012, a 70-percent jump over 2011. Mobile made up 13 percent of total Web-based purchases.

In Flurry’s report, shopping apps were found predominately within the shopping category on Google Play, and within the Lifestyle and Food & Drink categories in the Apple App Store. “Shopping” has the following five sub-categories along with the most popular retailers/companies:

  • Retailer Apps: Walmart, Target, Macy’s, Victoria’s Secret, Gap, Saks 5th Avenue
  • Price Comparison: RedLaser, Grocery iQ
  • Purchase Assistant: ShopSavvy, ShopAdvisor
  • Online Marketplace: eBay, Amazon
  • Daily Deals: Groupon, Living Social

Retailers saw the greatest increase in time spent, from a share of 15 percent of time spent by consumers in shopping apps in 2011 to 27 percent in 2012. The growth in retailer app share has come at the expense of daily deals, down in share from 20 percent in 2011 to 13 percent in 2012, and online marketplace apps, which contracted from 25 percent in 2011 to 20 percent in 2012. Retailers are beginning to better respond to the shift created by the collision of online meeting offline shopping through mobile apps, says the report.

Flurry says the days of retailers working to get shoppers into stores, where 95 percent of all purchases take place, are gone. Instead, in the new mobile app economy, devices are always with consumers, always on, always connected, and consumers can be intercepted in store aisles and even on their way to the cash register.

“In the new App & Mortar economy, they serve as virtual, portable show rooms that consumers can use to shop anytime, anywhere,” the report notes.

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