The cost-of-living crisis is squeezing day-to-day household budgets, making it imperative that retailers sync up with consumer needs. Retailers often end up being hit hardest when consumer spend is reduced during periods of uncertainty, making major sales and shopping events a crucial strategy to engage new customers and drive loyalty with existing audiences.
Economic struggles are funnelling app users to shop during major events in the retail calendar to catch the best deals, giving them an even greater importance than usual. For non-store retailers – that is predominantly online retailers – sales grew by 2% in January, ahead of standard retail sales. Similarly, eCommerce app marketers saw overall in-app purchases (IAP) in the UK remain steady for Black Friday 2022 compared to the previous year, despite financial uncertainties. These events offer narrow windows of time when user intent to spend is high –but so is the competition.
The retail year is marked by a number of these moments, including Boxing Day and New Year sales, Valentine’s Day, Mother’s Day, and more. By reflecting on performance during Black Friday 2022, app marketers can successfully adjust their tactics and maximise results for upcoming retail events.
Nothing can shake consumer appetite for a good deal
Recent ONS figures demonstrate online shops were strengthened by January sales, keeping growth positive as we enter the New Year. Likewise, IAP skyrocketed by 77% on Black Friday 2022 in comparison to the Fridays leading up to it, demonstrating that retailers’ opportunity to boost sales consistently peaks during seasonal and promotional events.
Even with financial concerns being front of mind for consumers, their total Black Friday spending on apps rose 2% between 2021 and 2022, underscoring the appeal of a bargain and the central role mobile apps have in their purchase journey.
In this same time frame, eCommerce app installs dropped 24% year over year. The contrast between installs and IAP suggests that the strategies app marketers use to make an impact have changed from previous years. As opposed to driving mass installs, app marketers are concentrating on acquiring quality users that deliver ongoing value.
Three tactics for future retail events — While early ONS figures show promise, however, there is no doubt that challenging times remain ahead, and brands and eCommerce app marketers need to adapt their strategies accordingly:
Don’t overlook loyalty — Although user acquisition (UA) is a core metric for any app marketer, it can be expensive to implement paid for UA campaigns. To ensure this ad spend brings long-term value, winning customer loyalty following that initial install is critical. For retail brands, calendar events are an ideal time to connect with existing users and drive repeat orders, as well as increase average purchase value.
In fact, retail brands will typically have a cohort of customers that return specifically for those attractive, limited-time offers and seasonal sales. App marketers should consider how to capture the interest of this consumer segment, for instance by exclusively offering free shipping or discounts to app users.
App marketers can also track purchase frequency (PF) to monitor the average number of purchases users make in a set time frame. This provides insight into buying patterns which can inform marketing decisions, for example giving users with a high PF additional in-app offers or exclusive products to reward them for their loyalty.
By honing in on user loyalty and measuring the impact this approach has on revenue, app marketers can drive ongoing performance and maximise their investment in UA.
Optimise owned channels — Retail brands looking to improve cost-effectiveness can use owned channels, including apps, to hit their objectives. With media inflation, tighter ad budgets, and lean teams all stretching app marketers’ resources, there is a need to achieve more with less and owned media can support this.
For instance, app marketers can use push notifications to deliver personalised announcements to users and inform them when product lines they have previously searched for or added to their basket are on sale. By ensuring users who tap on the notification are taken directly to the product landing page or their basket, marketers can create a frictionless buyer journey that increases the likelihood of purchase.
To optimise owned media, app marketers must set benchmarks and targets such as boosting average revenue per user (ARPU). This metric can let retail brands know how much each user spends in their app. To calculate it, app marketers should divide the revenue generated in an event by the total number of app users that were active during that event. Since ARPU doesn’t rely on knowing when the app was installed, it encompasses all active users and establishes the overall quality of user bases for generating revenue.
User generated content will boost consideration — As consumers will be cautious about what they buy in 2023, app marketers mustn’t ignore the consideration stage of the buyer journey. To engage consumers at this point, retail brand websites and eCommerce apps are continuing to adopt user generated content (UGC).
This tactic combines elements of social and eCommerce into a seamless experience, plus makes creativity a huge factor for success. Replacing static content with engaging or interactive short-form video wins user attention, while swapping models with genuine buyers who represent consumers heightens relevance.
Customers want to make informed purchase decisions and seeing other shoppers using the products they are interested in provides the relevant information they need. This will make UGC especially valuable for retail events, when offers are temporary and consumers are looking to quickly gather as much information as possible.
By refining app marketing tactics, retail brands can attract significant consumer spend around key seasonal dates in 2023 and beyond. With a focus on cost-effective platforms, strong creative, and metrics that matter, app marketers can drive revenue during the moments when consumers want to spend. What’s more, enhancing strategies for acquiring and retaining quality users will also increase the potential for success outside of these dates.