Looking at the criticism fashion etailer Myntra got after it shut down its desktop site and transitioned into app-only mode in May 2015, we thought no other ecommerce player would think about going app-only.
To our surprise, soon the rumour about Flipkart following Myntra’s footsteps started floating. The etailer denied the speculation. Although, by making its biggest sale event- Big Billion Day an app-only sale, it makes us wonder, if the rumour will turn out to be true eventually.
“All our development and innovation is app first, and it will continue to be our flagship experience,” said Akshay Sahi, Head – Customer Experience at Amazon India in of his interviews.
Why consumers are still encouraged to shop on the mobile app?
In spite of numerous reviews & analysis, which leaves no doubt in mind that customers aren’t happy about the app-only move, why are etailers hell-bent on pushing it? What is it about the strategy that etailers are turning blind eye to users’ comments?
Following reasons came up:
High traffic through mobile platform as compared to desktop
About 75% of Flipkart’s traffic comes from its mobile app, while it was 90% for Myntra before they switched to app-only mode. For Amazon, mobile traffic is over 60% and in case of Snapdeal, it is over 75%.
M-commerce is the future
Industry experts firmly believe that m-commerce is the future of ecommerce. The number of smartphone consumers using mobile apps of e-commerce players has gone up from 1,680 (21%) in May 2014 to 4,320 (54%) in May 2015.
Mobile offers better shopping experience
This is what etailers claim. With image search feature, social commerce, and customized offerings on mobile platform, etailers are convinced shoppers’ get better buying experience. But, what about inability to view product details on large screens, open multiple tabs & compare, filter search results and price comparisons? Many buyers feel ‘enhanced shopping experience’ is all hokum and the bottom-line is ‘help us to save & make money, reduce cost and stalk you.’
Reaching Profitability and financial viability
After burning bucket-load of cash, profitability is on every ecommerce company’s mind. It’s about time VCs made some money after pouring funds for years. One way to do it (according to etailers) is to bring advertisers and buyers on app rather than spending money on maintaining a full-fledged website.
Preparing for a battle with Google, Facebook and other social media players
Google, Facebook, Twitter and other social media platforms are biggest influencers in today’s times. With Google’s ‘Buy Button’ coming soon and social media companies’ foray in ecommerce, existing players like Flipkart are trying to get a head-start and build individual brand identity. Remember how Flipkart didn’t participate in Google’s Great Online Shopping Festival 2014 (GOSF) and instead chose to offer its own discounts through its mobile app?
Majority matters, minority don’t
The fact is majority of the online buyers from Tier-2 & 3 cities (largest unexplored market), non-metro cities and remote areas never had strong broadband services and desktops/laptops. They accessed ecommerce desktop sites then mobile site and now apps, all on their phones. With smartphones getting cheaper and mobile screens getting bigger, buyers who never had computers aren’t bothered with desktop site shutting down. So, ecommerce companies are focusing on this majority.
Data mining opportunity
Pay attention to the list of permissions that ecommerce apps ask for. Right from access to your profile, contact list, to device/app history, etailers need all. Desktop sites captured cookies but apps have gone several steps ahead to collect personal data of users. Take a guess why consumer data is something every company craves for?
What do sellers think?
IndianOnlineSeller had put up a question about Flipkart’s speculated app-only move on its Facebook seller forum page and all those who responded called it a ‘suicide’ in one way or another. However, those responses we believe were as ‘users’ and not primarily as ‘sellers’.
IOS spoke to many sellers in regard to this trend and when asked to answer strictly from a seller’s point-of-view (and not as buyers themselves), most of the merchants don’t seem to mind app-strategy as they understand at the end of the day its business and making money is priority. They are happy as long as the orders are flowing in. Moreover, there are other pressing issues on their mind such as margins, shipping fees, cancellation & returns, seller support, processing orders during festive season and getting money on time instead of spending energy over etailers’ app strategy and customers’ outrage over it.
IOS had a chat with Rupali Kelshikar, Director of United Three Endeavors about the app craze. She owns two brands, ‘Be For Bag’ and ‘Bag Forever’, which are listed on all major online marketplaces and fashion sites.
We asked Rupali her thoughts on this app-centric strategy from a seller’s point of view. She reasons,
“I do believe in this move, as it is based on the fact – that 70% of online browsing and buying happens on mobile site/app. Therefore, it does make sense in investing in operations to cater to this audience, rather than investing in operations for desktop audience, which is reducing in any case. As a Be for Bag seller, also our objective is to reach out to larger audience in the bags and luggage category. Our target audience being in the age group of 14- 25 years, which mostly does browsing on their smart phones. So, it completely works for us.”
Next we asked, have they recorded any significant rise or drop in sales due to marketplaces’ apps and she stated there has been a marginal spike in sales, though not considerable at the moment. But over the period of time she is hoping that sales will increase.
As for change in returns rate due to apps, Rupali added,
“Both our brands- Be for bag and Bagforever, we offer a value for money product as well maintain high quality standards, and most of the customers are very pleased with our quality. Therefore, change in selling experience from desktop to mobile has not really affected our returns.”
Lastly, we asked, as a seller, what will she pick – app-only or app-also along with desktop and mobile site? Rupali affirmed,
“As a mature seller, I would pick app- also along with desktop, as it allows me to browse my products at work on a larger screen also, instead of relatively smaller screen space on mobile. Likewise, the mature customer base, who are not too mobile savvy would definitely enjoy buying experience on the desktop.”
Bone of Contention
We have gone through the reasons and sellers’ views to understand why so much focus is on app by marketplaces. The reasons are legit from a business’s point of view and we are sure etailers are getting encouraging numbers to stick with its app-centric strategic decision, in spite of the resistance. However, the cause of disagreement when it comes to desktop users still remains.
In case of startups like Ola, UrbanClap, Grofers, Peppertap, they all are app-only ventures from the very beginning. They gave consumers one straight choice – download our app if you want to use our services.
However, in case of companies like Myntra and Flipkart, buyers feel their freedom of choice has been taken away against their wishes, which is true.
It’s the arrogance and plain disregard hidden under the mask of ‘we are only looking for your best interest’ that has rattled everyone.
In the next 2-3 years, we’ll know the final score of ‘gain and loss’ due to app-first or app-only strategy adopted by ecommerce companies. Till then let’s keep playing the guessing game.