Why it’s Important for Brands to get Into Digital Wallets

By Mike Balducci, Vice President, Strategy - Digital Business Development, Valassis
Published Monday, Oct 31, 2016

Why it’s Important for Brands to get Into Digital Wallets

If you’re a retail brand, getting consumers to install, then actually use your mobile app is hard. App fatigue has set in with consumers and it’s expensive to get your app to stand out from the other 2 million or so apps out there.  

Cost for the consumer to install is the first issue. Cost-per-install metrics are rising so fast that some tracking firms like Fiksu officially stopped tracking it!  If you get past the cost-per-install hurdle, the next step of getting a consumer that installs your app to actually use it can be even more of a challenge.  A recent study by Quettra reported that the average Android app loses 90 percent of users within the first 30 days of initial installation. Studies on converting an install to an active user on iOS show similar drop-off rates. Costs to acquire a loyal app user skyrocket when drop-off rates are factored in with the cost of obtaining an install.  At the end of the day, most mobile consumers only use a few apps regularly, so don’t be surprised when it’s not your brand’s mobile app they choose.

So, how can you drive increased consumer adoption and usage of your brand’s app?  First, look at how your most loyal customers are using it. Most retail mobile apps offer common features like mobile payments, a loyalty program, digital coupons and relevant content. You may think a few more features or a modernized user experience will do the trick. Maybe, but I highly doubt it.  It’s likely that only your most loyal customers are going to use your app, regardless of what you do or give away to incentivize its use. 

If you really want to drive more engagement with mobile payments, your customer loyalty program, digital coupons, or offers, then it’s time to look beyond your existing mobile app to the apps that mobile consumers are already using every day. 

One type of native app being used increasingly by mobile consumers is the mobile wallet. In fact, the majority of U.S. and U.K. consumers have now used a mobile wallet, according to a recent study by Urban Airship. And, if you are targeting millennials, 67 percent reported using their mobile wallet in the last three months, supporting the need to focus on getting your brand and customer loyalty program into those wallets.  

With each operating system upgrade, the features and capabilities of mobile wallets are expanding and improving. In addition to facilitating mobile payments, you can administer your customer loyalty program, including the earning and redeeming of points, and also facilitate the promotion and redemption of digital coupons and offers. One really cool feature in the latest release of Apple Wallet is the ability to deliver lock screen notifications when you make a change to your wallet pass. Another great mobile wallet feature is built upon relevancy. For example, when a digital coupon becomes relevant to the user based on time or location, the wallet will automatically alert the user via a lock screen notification. 

The bottom line is, just like getting a mobile app on the deck of a phone, once you get your brand in a mobile wallet, it stays there unless the user removes it. So maybe it’s time to stop fighting for app installs and loyal users and focus on getting your brand’s content in the apps that consumers are beginning to use regularly -- like their mobile wallets… at least, that’s my thought.