The popularity of mobile phones and apps for shopping will determine the small number of winners from the vast majority of also-rans in the world of online retail.
While people are spending increasing amounts of time on smartphone apps – up 24% year-on-year in the fourth quarter of 2014 to 37.3 hours, according to Neilsen – the number of apps accessed has remained flat at around 27 per month.
We can conclude from this that while apps are being used more often consumers are not using a growing number of them. There is clear evidence here to suggest that people are finding their preferred apps and using them more heavily.
This is against a backdrop of an explosion in the number of apps available. Figures from Apple show the number of apps is up 25% year-on-year in 2015 with a massive 1.5 million currently available.
This suggests there must be an enormous fight going on between retailers to get onto consumer’s preferred lists of 27 apps. If you think this is tough ask then Comscore calculates that 96% of time is spent by users on their top 10 apps. The remaining 17 attract little attention even though these are effectively the ‘chosen’ ones. And the rest, it has to be said, are toast.
The retailers in this top 10 are positioning themselves well to be future winners and being in this grouping is especially critical for fashion sellers as smart devices represent a serious sales channel for the category. Fashion accounts for 35% of total spending on mobile devices and 22% on tablets.
City firm Bernstein reckons this scenario will drive consolidation of fashion retailers online and it is placing its bets on Asos and Zalando as the likely future winners because as brand aggregators they offer consumers the broadest range of options.
At present over 50% of visits to Zalando are via mobile and for Asos 44% of orders are undertaken from mobiles, which provides plenty of evidence that Bernstein is putting its money on the current leaders of the pack.
It seems that as shoppers increasingly move to buy goods online via smart mobile devices then the opportunity for smaller retailers to muscle in and pull consumer’s attention away from their preferred apps and mobile sites is becoming extremely tough.
Glynn Davis, editor of Retail Insider