International grocers are catching on to app fever

After successful launches by the UK’s Ocado and Tesco, international grocers from Germany to Australia are now looking to capitalise on the trend towards mobile shopping.

Earlier this month, Ahold-owned Peapod, a leading online grocer in the US, became the first major supermarket chain in the country to launch a transactional mobile app and Carrefour in France recently launched an app allowing customers to use mobile phones as loyalty cards and to download a floor plan of its stores in Écully and Vénissieux.

The move towards mobile browsing and shopping is very much in its infancy. However, the number of smartphone users is reaching critical mass, which is opening up an entirely new portal for retailers to reach consumers.

The wisest retailers are looking to capitalise on this trend at an early stage, so as to build up a brand presence. Research from Parks Associates suggests the number of smartphone users globally could exceed 1 billion by 2014. While this clearly represents an opportunity for retailers, it is important to remember that

a large percentage of revenue generated from the mobile channel will be at the expense of other ecommerce. It is unlikely to be lucrative as a standalone channel; yet it will be critical for retailers with a strong online presence to launch into mobile to follow their customers’ needs.

Few retailers have yet to take the plunge into transactional platforms. In fact, outside the UK, Ahold and Migros in Switzerland are the only major supermarkets to launch transactional mobile apps. However, a large number of retailers are embarking on services-based apps to allow shoppers to use their phone to scan barcodes, view recipes, create shopping lists, and so on.

Last month, Meijer in the US launched Find-it, an app that allows shoppers to see the location of more than 100,000 items in a retail supercentre. In Australia, the Coles Shopmate app was unleashed this summer, offering real-time pricing aimed at a user’s location. Virtually all of the major French and German grocers offer services-based apps. Even discounter Netto offers an app with weekly promotions, a shopping list generator and a store finder.

Services-based apps will become standard practice for the major supermarkets. But transactional apps are only likely to take off in regions where grocery ecommerce is already established, primarily in Western Europe and North America.

Natalie Berg, research director, Planet Retail.