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Habit-forming technology: beating the app sales slowdown

(Image credit: Image Credit: Carballo / Shutterstock)

The rapid growth of smartphone and app usage has brought myriad benefits, both to businesses and to end users. More and more retailers are choosing to lead with a ‘mobile-first’ strategy, designed to deliver richer shopping experiences for their customers and ultimately drive growth. If an app works well, an organisation can leverage it to engage more closely with their customers and maximise sales through the hugely popular mobile channel. For customers themselves, they have a simple, convenient way to shop at their fingertips.

However, recent statistics have suggested that sales made through mobile may be in the midst of a slowdown. According to IMRG Capgemini, online sales maintained a strong start to 2017, with double-digit year-on-year growth in February. Sales made on smartphones also grew by 57 per cent in the same period. Despite this increase, when compared to February 2016’s figure – where year-on-year sales grew by 96 per cent – it is notably less impressive.

These figures point to a possible growth in ‘app fatigue’, whereby retail apps are no longer doing enough to build a lasting, emotive connection between a customer and a brand. Customer demands are becoming more complex by the day: an app needs to be easy and convenient to use, and should do everything that is required to satisfy a customer’s needs in both the short and long term. For this to happen, retail businesses must rethink the effectiveness of their in-store apps, by understanding the deep-rooted psychology behind customer engagement.

Understanding the psychology

To reverse this downward trend in mobile sales, retailers should look to exploit habit-forming principles to understand why customers engage with apps in the first place and, in doing so, reduce the threat of app fatigue and help connect with them on an emotional level.

Despite the general popularity of mobile apps, they have to earn their place on a customer’s smartphone if they want to stay there in the long term. Unfortunately, many retailers’ apps fail to do enough to suitably enhance users’ shopping experiences. The result is that engagement often fails to meet the expected demand and app fatigue subsequently develops, as users begin to shed their least useful apps.

In such an event, many see the solution as a redesign of an app, to make it faster, slicker and what they assume to be ‘user-friendly’ in order to capture consumer interest. However, simply adding a few bells and whistles will not be effective if the business has failed to examine the deeper qualities that make a customer stay loyal to an app. In short, habit-forming technology should be employed as a key part of the app development process.

Forming positive habits

For any retail business worth its salt, encouraging customers to develop positive purchasing habits should be a key priority. This focus on psychology has been prevalent in high-street stores for years: as an example, different branches of the same store often have an identical or very similar layout, which creates a comforting sense of familiarity with a brand. For apps to emulate this success, similar habit-forming approaches need to be embraced.

Habit-forming technology has been successfully employed by the likes of Facebook, Twitter and Snapchat to increase engagement and develop platforms that are built on impulse. Leveraging this technology involves identifying four key hooks, and making the most of them to make sure users keep coming back again.

1. Trigger. This first hook involves building an app so it focuses on solving a particular pain-point for a user. In a retail sense, this could be a desire to keep up with the latest fashions, with the app then offering a solution to these issues. When this association is made, customers are likely to pick up the app and begin using it.

2. Action. Once a trigger has been identified, a retail app should make it easy for users to take action. This could take the form of a user-friendly interface where customers can quickly and conveniently shop for clothing. This is an area where other apps in the consumer world have excelled: scrolling through an Instagram or Twitter feed, for example, is a very straightforward process.

3. Reward. Without there being a positive end-result for taking action – a reward – an app can fall flat. Users need to know that embracing the app has varied, tangible benefits if they are to come back and use it again. In a retail situation, this could take the form of relatable models within product imagery and the provision of targeted, personalised alerts on new items to enhance the shopping experience and build a connection.

4. Investment. Once a user has acted and received an appropriate reward, there must be an incentive for consumers to come back and use the app again. Essentially, an app needs to work so effectively and be so user-friendly that it becomes irreplaceable. Again, apps such as Facebook are so successful largely because of their addictive properties, which keep users coming back for more.

These hooks should be a crucial consideration for any retail business looking to improve the performance and engagement levels of its app. In effect, they should form the foundations for any consumer-focused app, with the visual appearance, imagery and branding elements then added in to complement this, rather than the other way around.

Standing up to the competition

While the drop in mobile-based sales figures is unlikely to cause widespread panic within the retail industry, dismissing it altogether would be a huge mistake. Competition is fierce, and businesses should be doing everything in their power to get ahead of their rivals. Indeed, industry data highlights that 303 of the top 500 retailers already have an app in place for customers, which demonstrates the current state of play. This will only intensify and because of this, those companies will need to develop new and more engaging ways to reach their target audience.

If you can understand the psychology behind why consumers engage with a product, this will provide a huge opportunity to not only design a product that can support sales growth, but also enable businesses to build relationships with a customer based on more than just satisfying a basic need.

Ross Tuffee, CEO, DOGFI.SH Mobile
Image Credit: Carballo / Shutterstock

Ross Tuffee
Ross is Co-founder and CEO of DOGFI.SH Mobile, having set up the company eight years ago. His previous experience includes roles at EY, First Choice and Diageo.