Report: Retailers Respond to Changes in Buying Behavior With New In-App Payment and Pickup Options

With the growth of online shopping and the expanding role of the retail mobile app brought on by the pandemic, Incognia chose to focus its second Mobile App Friction Report for 2021 on reviewing the mobile purchasing experience, comparing 12 of the most popular m-commerce  apps. The following apps were included in the study: Bed, Bath & Beyond, Best Buy, Costco, Hobby Lobby, The Home Depot, JO-ANN, Lowe’s, Sephora, Target, Ulta Beauty, Walmart, and Wayfair.

As a result of the pandemic, in 2021 there will have been many changes in consumer buying behavior. Social distancing and limited store access has given a huge boost to online shopping, with the adoption of mobile accelerating with new consumer buying patterns that merge online and offline experiences. In 2020, buy online, pick up in-store (BOPIS) became a new mode of shopping for many consumers. Customers have also been quick to embrace contactless forms of payment, including in-app payments, to minimize physical contact. For many customers, 2020 was the first time making a purchase via their mobile device. Furthermore, consumers have turned increasingly to retailers' mobile apps to not only make purchases, but also to manage the pickup of purchases in-store or at curbside.

For retailers, the purchasing experience is where the customer experience begins and also where it can end if the process is too complicated or creates too much friction. The Incognia Retail Mobile App Study reviewed the purchasing experience, capturing screenshots and measuring the steps involved in completing a purchase. The report used this data to calculate a M-Commerce Checkout Friction Index and ranking for each app. The list of apps reviewed not only includes mobile apps from major retailers, but also apps for specialty retailers including beauty products as well as crafts and fabrics. We wanted to review the purchasing process across a selection of m-commerce apps representing different types of products as well as sizes of user base.

Overall, Lowe's; The Home Depot; Bed, Bath & Beyond; and Sephora's mobile apps were the winners for lowest m-commerce checkout friction, representing the lowest combination of required clicks, screens, fields, and overall purchase time.

Other key results include:

• BOPIS was supported in more than 60 percent of the apps reviewed in the study, showing how quickly retailers have adapted their mobile strategies to support new consumer buying behaviors.
• Eighty percent of the apps reviewed in this study supported PayPal for in-app payment, compared with 20 percent supporting Apple Pay.
• Home improvement and craft and fabric apps delivered the fastest checkout times on mobile, illustrating how retailers are removing the friction in market segments where sales have soared during the pandemic.

Retailers can download the full report free here.

The number of retail apps offering curbside or in-store pickup is a reflection of the significant shift in buying behavior brought on by social distancing. Each of the apps supporting pickup purchase options prompted the customer to allow location permissions in order to assist with finding the nearest store, specific items or deals, and also to anticipate when the customer would arrive to pick up an order, saving time during curbside pickup.

The popularity of PayPal as an in-app payment option (80 percent) is also notable compared with the presence of Apple Pay as an option (20 percent). With in-app payment capabilities there's the opportunity for retail apps to further bridge online and offline experiences, supporting convenient payment options at home and in-store.

As stores reopen in the U.S., retailers have an opportunity to continue to build loyalty with customers through their mobile apps. Many consumers will continue to choose the convenience of purchasing via mobile app, using BOPIS and in-app payments. Other consumers are eager to venture back into stores, and with their mobile devices in hand, retailers can continue to build loyalty and new purchasing experiences via their mobile apps.

Paula Skokowski is the chief marketing officer at Incognia, a privacy-first digital identity solution for mobile apps that enables real-time recognition of trusted users at onboarding, login, and payments.