Three small businesses show how mobile and Facebook apps can help you attract new customers and increase how much visitors spend on your site.
According to a recent AT&T Small Business Technology Poll, 72 percent of the small businesses surveyed said they used a mobile app in their business. Even more striking, nearly 40 percent of those surveyed said their business most likely would not survive -- or would be greatly challenged -- without mobile apps.
Thats not that surprising considering that smartphone use continues to rise; as of January 2011, nearly 66 million Americans owned a smartphone, which is an 8 percent increase over the previous three months, according to comScore. And that number is expected to continue to grow, with more consumers using "smart" devices (phones and tablets) to do research, browse, and shop online.
However, while mobile apps are undeniably hot, does that mean that you should invest in one for your business? And how do you go about choosing the right app? Small Business Computing interviewed three small businesses to find out.
Using a Mobile App to Extend Your Brand, Provide Added Value
A few years back, Kathy Harrison and Becky McCraney, the owners of Miss Cayces Christmas Store, created Show Me Decorating to showcase their holiday decorating techniques. They even created a DVD titled "Recipe for Holiday Tree Trimming," which provided step-by-step holiday decorating instructions -- and nicely dovetailed with their Christmas store business.
Then, in 2010, while playing with their iPhones, they realized there wasnt a good holiday decorating app available. And a light bulb -- or, in Harrison and McCraneys case, a whole string of Christmas lights -- went off. Why not further extend their brand and attract even more customers by turning "Recipe for Holiday Decorating" into an iPhone app? After all, they had all the information and photos. They just needed to customize it for the iPhone.
After researching iPhone app developers, Harrison and McCraney found one they felt was a good fit -- and worked to roll out the new app in plenty of time for the 2010 Christmas season. Unfortunately, not everything went according to plan, and the app wound up costing more ($20,000) and being ready later than they had initially planned. Still, they felt the investment was worth it and that the decorating app would be much more effective (and ultimately less expensive) than print advertising. [Note: Adventurous business owners can also use tools like AppMakr to create their own iPhone apps for free.]
And the initial response was very positive. "Our customers were very supportive and excited," said McCraney. Especially the younger, more tech savvy customers. "Everyone was really amazed that a local retail store could have an app."
McCraney loves it when customers come into Miss Cacyces Christmas Store (which is based in Midland, Texas) with their iPhones, checking off what they need. (The app provides decorating theme ideas, step-by-step instructions, and an ingredient list with quantities suggested based on the size of the Christmas tree chosen.)
Suppliers have also been very supportive and excited to have their Christmas products promoted.
"We have gained [customers] and have the potential to gain more because the app has given us a national presence and allowed us to share our decorating expertise without opening another retail location," explained McCraney. And the owners are hoping to further capitalize on their mobile app by releasing an Android version this year.
Mobile Apps Can Make It Easier to Shop at Your Store
Magic Beans is a Boston-based clicks-and-mortar business that specializes in baby gear, toys and "surprises" -- with one of those surprises being a mobile app that lets customers scan product bar codes, see detailed product information, purchase items and receive offers and coupons via their iPhone or Android device.
In the case of Magic Beans, the mobile app developer, AisleBuyer, approached them.
"We felt [Magic Beans] would be an ideal partner to beta test AisleBuyer given their tech-savvy clientele and owners who were seeking out new technology to enhance the customer experience," explained Andrew Paradise, the founder and CEO of AisleBuyer.
As for Sheri Gurock, the founder of Magic Beans, she was attracted to the idea for several reasons.
"We sell toys and baby gear, and our staff needs to be really knowledgeable to help parents make good purchase decisions about these important products," she explained. "By letting customers check themselves out at the end of a transaction, we make more time for our staff to talk to customers and help them."
The mobile app also cuts down on wait time, which is very important to busy parents. And the app "gives [customers] great insight into the products in the store by showing product descriptions and customer ratings," Gurock added.
As for customer reaction, Gurock said its been very positive. "Early adopters were very enthusiastic, and with some time and training, many of our smartphone-toting customers really warmed up to the idea." (Click this link to see a demo of the mobile app; scroll down a bit and click on View the demo).
Even more exciting, the app has brought in new customers. "People were really curious about the technology and how it works, and that drove a lot of traffic," Gurock said. "And in AisleBuyer's study of the beta launch, they found that people who used the app spent 19 percent more than our regular customers -- definitely a good thing!" (Per AisleBuyer, small and mid-sized businesses such as Magic Beans typically see a sales lift of more than 8 percent over the traditional point of sale after deploying the app.)
And although Magic Beans didnt have to pay for the AisleBuyer app (which typically requires an upfront fee and then a percentage fee on each transaction, both of which vary depending upon the business), Gurock cautions small business owners to "really think about ROI when making the decision to develop an app.
"It's easy to get swept away by the coolness aspect of an app," she said. "But if it's really going to propel your business forward (as any good investment should), the app really needs to dovetail with your companys mission
and add new dollars to the till."
Dont Forget about Facebook Apps
When Melrose Jewelers, a leading online retailer of luxury watches, was looking for a way to increase customers and sales, it turned to Facebook -- specifically to a clever Facebook app.
"With more than 629 million Facebook users worldwide and nearly 200 million located in our largest revenue-generating countries (the United States, the UK and Canada), we saw Facebook as a huge opportunity to take our brand to the next level," explained Krishan Agarwal, the CEO of Melrose Jewelers.
"Facebook applications are simple, entertaining plug-ins that add a bit of excitement to the typical Facebook session," he continued. Moreover, he and his director of online marketing, Kyle Mitnick, saw Facebook apps as a quick, easy and inexpensive way to increase their fan base and to better engage prospective and existing customers."Because luxury buyers tend to define themselves through their purchases, we believed correlating a comedic persona to one of our Rolex watches via a fun personality test would be a good concept for the app," explained Mitnick. (The app Melrose developed asked Facebook fans to answer a few questions, which then matched them to one of their luxury watches and posted the witty result -- e.g., Apparently, Im an 18k Rolex Day-Date President because... -- on the fans profile.)
Melrose ran the app December 2010, a very busy time for retailers. And the campaign immediately went viral, resulting in a significant number of new fans and customers.
"There was an incredible 220 percent spike in the month of December, elevating the fan base from 11,716 to more than 70,000," stated Agarwal. "During this time, daily active users increased a staggering 291 percent, boosting brand exposure, product awareness and customer interaction."
Even more impressive, Facebook fans accounted for over $100,000 in sales for the month of December. "The results exceeded our expectations, especially because it was so inexpensive to create and run the app [only $175]," he noted.
While Melrose Jewelers clearly benefited from using a Facebook app, Agarwal and Mitnick point out that a large part of that success was a result of doing their research and timing -- and having realistic expectations when using Facebook for marketing.
"Business owners must be conscious of the fact that Facebook may not breed trackable sales in the beginning, although it does provides significant credibility to your business," explained Mitnick. But the advantage of using Facebook apps is that if you create and use the right one(s), "you can turn idle Facebook fans into engaged participants and [ultimately] loyal customers
who will become social evangelists of your brand."
Jennifer Lonoff Schiff is a regular contributor to Small Business Computing and runs a marketing communications firm focused on helping small and mid-sized businesses.
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