Target is on a path to consolidate its suite of mobile apps into one, combining mobile shopping, the loyalty program and payments in a single place after experimenting with a litany of separate apps.
Over the past decade, the retailer rolled out a number of consumer-facing apps: the Target app, launched seven years ago; pharmacy app Healthful; bridal and baby registry app Registry; discount offers app Cartwheel; and Target Connected, a companion app for its connected lights system launched in 2018.
As of now, three of these consumer-facing app platforms are active: Target, Target Connected and Registry — fusing as much of the shopping experience into the main app, while the two remaining companion apps cater to highly specific use cases outside of the core retail experience. Cartwheel was folded into the main Target app in 2017, while Healthful was shut down.
In centralizing its apps, Target is joining other retailers that have moved away from single-use platforms. And while Walmart has a number of internal employee workflow apps, its consumer-facing app strategy focuses on two apps: one for general shopping and another for its e-commerce grocery business. Target declined to comment on the record.
“There is a big push for ‘super apps,'” said James Lanyon, vp of strategy and innovation at T3, a digital agency that develops apps for retailers. “We think about WeChat as the most prolific version of that — it’s about how can we capture a person’s entire commercial existence into the app.”
While mobile apps are table stakes for large stores, they take resources to maintain, and have the potential to put off customers if the user experience is clunky. Some retailers may have resisted app consolidation due to capacity and internal organization-related challenges. Big-box stores are pulling various functions into their core mobile apps, including loyalty, payments, delivery and pickup. It’s a strategy to further lock in their most loyal customers. By contrast, a multi-app strategy subdivides the potential customer base.
Merging Cartwheel and Target may have been motivated by the desire to increase sales, said Gene Liebel, co-founder of digital agency Work & Co.
“By merging Target’s apps, they’re betting that they’re going to get more people to discover how good online shopping is and encourage people to join the loyalty program — loyalty leads to more frequency of shopping and higher basket sizes,” he said.
Per TechCrunch, at the time Target absorbed Cartwheel, the discount app was more popular than the main app, appearing in “Top 10” most popular shopping app lists (the main app was in the “Top 2o”) and was reportedly downloaded 40 million times.
The objective was to fuse loyalty, discounts and a digital catalog into a single platform to drive more sales volume.
Another motivation for merging shopping, discounts and the loyalty program in one place is to ensure seamless mobile payments, said Liebel. Target launched its barcode-based mobile payments tool Wallet in December 2017; it lives within the retailer’s primary app.
“It would be clumsy to support mobile payments in-store without integrating — the customer would often have to scan a barcode multiple times [in a separate platform],” Liebel said. The challenge with consolidation, however, is discoverability; a challenge many brands are trying to crack.
Jonathan Smalley, CEO of data analytics company Yaguara, which also has retail clients, agrees that converting prospects into customers is likely the primary driver for app consolidation. The challenge, he said, is trying to entice customers who may not already be loyal, exclusive Target customers, and who may choose to peruse goods in multi-brand platforms like Postmates.
“I’m curious how this is going to affect customers using other channels, especially if more millennials become customers,” he said. “Consolidating into a single app makes [the retailer] own that data, but you need to be careful not to silo yourself from losing those top-of-funnel users by integrating with other applications.”
The post Why Target is focusing its mobile strategy on a single app appeared first on Digiday.