Mobile wallets are emerging as a key addition to retail applications

Retail mobile apps have become indispensable to consumers and are changing the way they shop. While mobile applications continue to attract considerable attention, all-in-one web services in mobile wallets are emerging as a necessary complement to individual mobile applications.

Alex Campbell, CIO and co-founder of mobile marketing platform Vibes, notes that mobile wallets can encourage app downloads for users who are hesitant to install full-fledged apps. They represent a significant marketing opportunity through Apple and Google wallets integrated into iOS and Android devices.

“It was once thought of as facilitating mobile payments or storing event tickets. But marketers have come to see it as a true engagement channel that connects the physical and digital worlds,” he told the E-Commerce Times.

Other research suggests that mobile apps don’t necessarily need a complementary role. A study released in April by custom mobile app developer Bryj highlighted strong consumer demand for companies to update their apps instead of phasing them out.

A competitive mobile application market

A Bryj survey of 1,000 US consumers revealed that the rise of mobile apps has revolutionized the way companies interact with customers, providing convenient access to products, services and information anytime, anywhere. But the researchers said businesses need to prioritize user experience, personalization, interface design and security so customers don’t have to delete apps that lack these features.

There are a number of mobile apps available and the competition is growing for the coveted home screen space. Thus, companies that do not modernize their customer contact strategies could struggle to achieve sustained retail app usage, customer retention, and sales goals.

“Whether through uniquely tailored recommendations or customized privacy settings, this level of customization increases user engagement and fosters a deeper sense of connection and brand loyalty,” Lawrence Snapp, CEO of Bryj, told The E-Commerce Times.

“Companies that use data-driven insights to deliver hyper-personalized experiences gain a significant competitive advantage in today’s highly competitive market,” he noted of what retail mobile apps will have at their fingertips.

Adapting retail applications for artificial intelligence and user expectations

Consumers now rely on mobile apps for shopping, work, entertainment and communication, and expect flawless user experiences.

To stay relevant, businesses should consider integrating AI into their mobile apps, with a recent study showing that nearly three-quarters (72%) of Generation Z and Millennials are open to AI-driven features.

“To remain competitive, mobile apps must reflect the latest trends and technologies, such as the integration of artificial intelligence and improved user interfaces. This ensures that companies deliver exceptional experiences and meet the evolving needs and expectations of consumers,” he said.

However, the appeal of modernized mobile apps may be waning. A Vibes study published in February revealed that digital wallets, which store loyalty cards, tickets, boarding passes, gift cards and more, are increasingly replacing branded apps.

The research also found that 54% of consumers aged 25 to 54 currently use or plan to use mobile wallets to store items such as digital offers and loyalty cards.

Bryj’s survey found that 62% of respondents, especially younger generations, have between 10 and 30 mobile apps on each of their devices. Almost a quarter (20%) of younger generations download about one app a week.

Consumers are looking for apps that save them time and offer simplicity. The margin was closed between those who listed saving time as their main reason for downloading the app (68%) and those who listed trying to simplify their lives as their second main reason (65%).

The Bryj survey also reveals that most consumers (64%) are more likely to use a company’s mobile app than its website via a mobile browser.

The attraction of mobile wallets

Mobile wallets bridge the engagement gap as persistent, contactless engagement channels that help unify the physical and digital worlds for marketing, commerce, services and loyalty without downloading apps. These features give brands two distinct advantages over traditional mobile apps.

Merchants can easily update the content of the mobile wallet pass and send timely relevant wallet notifications to the user’s lock screen. This capability provides them with a robust channel for continuous engagement with their customers. It brings these customers into stores to redeem coupons, offers and points.

According to Vibes, 75% of consumers say that text messages routinely lead them to buy from brands. Sixty percent of respondents used a loyalty card stored in a mobile wallet when making a purchase on the spot. Just over half (54%) said they made a purchase on the spot when a brand made an offer available through a mobile wallet.

Campbell noted that digital wallets play a critical complementary role by allowing consumers to store and access shopping essentials — such as coupons, loyalty cards, tickets and gift cards — in one place. Their ability to dynamically update in real-time helps brands address a key challenge: encouraging customers to download and consistently use their mobile apps.

“It’s what we call a ‘low-reach, high-engagement’ channel. It’s fantastic when a loyal customer downloads your app, but most won’t. Mobile wallets bridge the gap between high-reach, low-engagement email marketing and low-reach, high-engagement mobile app marketing,” Snapp offers.

Mobile wallets and SMS as promotional tools

The move to mobile wallets is due to the fact that mobile wallets are becoming a bigger part of consumers’ lives. Additionally, Campbell noted that both Apple and Google are developing and promoting mobile payment wallets.

He explained that it’s “a combination of consumer demand and marketers waking up to the limitations that email and mobile apps present, as well as how easily Mobile Wallet integrates with their SMS marketing.”

For example, brands can increase revenue by using SMS in combination with mobile wallets to drive traffic to retail stores and restaurants. A brand can send a text with a link to a $3 mobile wallet coupon, double loyalty points, or similar promotional offers.

This strategy allows brands to track every ticket pulled and measure the success of SMS/wallet campaigns with clear attribution.

The role of artificial intelligence in shaping the future of mobile applications

Artificial intelligence is significantly impacting the mobile app industry and will continue to introduce new tools to make it more accessible to consumers, noted Bryj’s Snapp. As technology advances, consumers now expect innovative features such as artificial intelligence.

“Our recent consumer survey on mobile apps found nearly three out of four Gen Z and millennials are open to these features,” he said.

Snapp added that AI-driven features such as chatbots, virtual assistants and predictive analytics can transform the user experience by making it more personalized, intuitive and efficient.

For example, personalization within mobile apps is no longer a luxury, but an expectation. Customers now expect experiences tailored to their specific preferences and requirements.

Snapp noted that the digital native generation is transforming the mobile experience as we know it. This shift makes it even more competitive for mobile apps to gain prominence on shoppers’ phone screens.

“As younger generations continue to see mobile apps as indispensable, we will see continued growth in this industry,” said Snapp.

The Bryj survey noted that poor user experiences such as software bugs and slow loading are the main reasons consumers delete mobile apps from their devices. Other reasons are poor user interface and poor security features.

“It’s important to note that many retailers are competing for consumer attention and app engagement. Additionally, consumers are most interested in the ability to customize privacy and security settings in mobile apps,” Snapp said.

He concluded that in order to compete in this increasingly crowded market, retailers must now invest in providing superior experiences and personalized touchpoints at every point of the shopping journey.

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