How To Avoid The Digital Multi App Dead-end Pitfall

BY ATOBI Team
Jul 7, 2018
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While mobile apps have been part of everyday life for some time now, most companies have been a bit slow in using them within their organization. Fortunately, this is changing as “…everything goes mobile.” Unfortunately, in the frenzy to adapt to changing times, organizations have implemented uncoordinated apps, without an underlying strategy.

Due to a lack of a proper app strategy they often end up with too many uncoordinated mobile apps from different suppliers. This makes cost skyrocket and they end up with a dead-end scenario where it is very hard to develop further and integrate app features for synchronized execution. Whether it is apps or just different channels and tools it makes communication and execution messy.

Instead, forward-thinking retailers choose to deploy apps on a cloud-based app suite enabling them to manage all their apps as features on one common platform, sharing users, data, features, integrations etc. This guarantees one solution with the right scalable architecture, continuous improvements of the system and low cost.


The True Price of App Development

Price range $140,000 – 500,000

Average price $270,000

Maintenance up to $7000 a year

Updates up to $10,000

Time-frame up to 18 months


 

History repeating itself

Getting off the ground with a simple app is cheap and easy. Unfortunately, the cost grows exponentially when the first app is off the ground. As more features are needed and scalability elements such as user hierarchies, language versioning, data management etc. are needed costs grow through the roof because the right foundation was not built from day one. 30-40 years ago, it was the same story with ERP and HR systems. They started off simple and then grew in complexity which gave rise to the ERP and HR suites eventually dominating the market today.

 

From Omni-consumer to Omni-employee

The in-store experience is becoming ever more important as a differentiator for retailers. The hype has long been about customer-facing technologies and customer mobile interaction through branded apps.

The digitalization trend in retail is now moving from being mainly focused on omni-consumer initiatives to also include a revamp of internal processes and systems in order for them to match the consumer facing systems and the digitized workforce manning the stores.

Retailers that are serious about the in-store customer experience have realized the importance of their staff being as digitally empowered as customers.

To meet the demands of the mobile workforce, retailers develop mobile apps (intranets, m-learning, checklist apps, competition apps etc.) to improve the drivers of customer experience.

 

Typical challenges retailers try to solve by implementing apps

  • Too many communication channels
  • Employees do not comply with VM guidelines or store standards
  • Store-based campaigns are not properly executed
  • The intranet is not used
  • E-learning has not delivered the expected results
  • The staff is not engaged
  • Streamline aspects of store expansion
  • Staff does not have customer and/or product insight
  • Need for growing in-stores sales

If you see yourself anywhere on the list, then read on…

A swarm of mobile apps for these various operational optimization purposes is being offered to retailers and each of them can seems well-suited for getting the job done. But a lot of retailers are now learning that just buying or building apps to optimize a process or replace an excel tool with a “cool app” can be both a costly affair and an operational dead-end.

 

What is the price really?

The real cost of developing a mobile app is far higher than the initial ’out of pocket’ budget estimated. Various studies indicate a price range of 140.000-500.000 USD to develop a feature-rich app and this, according to Forrester, seems to be only about 35% of the true two-year cost of the app. Interestingly enough the largest cost driver is not the features of the app but the app infrastructure.

Development time is also considerably higher than expected. A VDC survey from 2017 indicates an average development and deployment time of more than 6 months.

 

4 steps to lower cost and faster time to “market”

When considering one or more apps as a way to improve, the business retailers will benefit from following the four steps below.

Step 1: Make an overarching app strategy

An overarching app strategy is needed, that bridges the customer-oriented apps, the internal apps, the commercial needs and the IT requirements. The vast majority of retailers see themselves as retailers, rather than software companies. This usually leads to one of two scenarios:

First one – a company buys apps as SaaS or gets them developed by app developers. Ideally, the app provider should understand retail inside and out. They must understand the way of working of the specific HQ departments (Education, Marketing, VM, Ops support etc.) that will be using the apps. Otherwise your teams will have to work very hard to transfer the critical knowledge, and your teams have other things to do than educate a software provider. Furthermore, 3rd party content providers also need to be taken into consideration, so content, features and integrations can be aligned for maximum effect. (If you choose an app suite to start with your app strategy is less critical. It can be developed along the way, which is also more effective).

To avoid this scenario, many companies try to develop a system in-house, because their IT department ‘can easily do that’…, but, essentially, they don’t have the knowledge and skills. Developing and maintaining a long-term, well-functioning app is very different from running bricks and mortar, or even to maintain other core IT systems. Most successful retailers do not develop their own ERP, POS, HR or other core systems. The same strategic logic should be applied here.

Step 2: Focus on the business purpose

  • List the top desired business metrics you want the app(s) to improve
  • Describe the behavior the apps should be driving
  • Map out how the different apps will be used by different user groups in an operational context. If store staff needs to use more than one app, you may be destroying value instead of building it

Step 3: Be sure you play to win

Many app makers throw in features and gamification elements without a deep understanding of human focused design and gamification. They typically apply scoreboards, badges and points as standard, but these can do much harm if not applied properly. They, more often than not, end up demotivating most of the store staff. Check with gamification experts have been involved in designing the app and make sure they are world class. Otherwise, you may be entering a game of Russian roulette, with too many bullets in the chamber.

Step 4: Integrate the app(s) on 4 dimensions

For maximum effect (and to avoid increased complexity) the app(s) needs to be deeply integrated with:

  1. Relevant core systems such as POS, ERP, HR, Finance and CRM.
  2. Non-core systems such as intranets, e-learning, checklists, Facebook etc.
  3. The organization e.g. the way of working of all of your departments and people.
  4. The yearly cycle of the retailer e.g. campaign calendars and collection cycles.

If the app(s) are not properly integrated they end up as even more separate system(s) to maintain and develop separately, taking time from core business instead of adding value.

You are now caught in a dead-end.

 

Are you in a hurry to get nowhere fast?

Some large retailers have in lack of an overarching app strategy developed multiple function specific apps for different purposes. The training department has an academy app, marketing has launched a product and campaign app, the visual merchandising team has developed a VM app, there is a mobile intranet app etc. Often the individual departments are not even aware of the apps developed by the other departments and some of the dire consequences are:

  • Apps are provided by different companies, on different technological platforms, creating a hazzle for the IT department
  • There is no synergy in the development process or cost
  • Integration with core systems has to be made several times
  • Apps are not integrated so operational execution cannot be coordinated
  • There is no ’one operational view’ of the business
  • Employees end up with 3, 4 or even 6 different company apps on their mobile screens. This makes them spend too much time on the mobile instead of with customers, which ultimately demotivates them not to use apps. At ATOBI we call this the “Multi-app dead-end” scenario

 

The multi-app dead-end scenario

Many retailers have just started down this path and have not yet seen where it leads. But when confronted with the multi-app dead-end scenario there are four typical ways to respond:

4 typical ways to react

1. The ostrich: Put your head in the sand, continue as is and focus on other important parts of the business.

2. The Quick fix:Integrate the most necessary features across the existing apps

3. Go “Software”: Start from scratch and develop one system that meet all demands. You are starting down the path of becoming a software company

4. “Effective Core”:Migrate the internal apps / features and users to an integrated cloud-based app suite. This allows you to focus on core business. Retail!

Depending on the nature of business and the number of apps in the retailer’s portfolio, option 4 addresses all the consequences of the Multi-app dead end. It is thus often the most sensible way forward.

You can also just start out right.

 

The “Effective Core” option entails:


Execution can be complex. The solution is simple

  1. One cloud-based app suite where all features are integrated into one app
  2. HQ functions can still ’manage’ their own set of app features, push content and interact with stores staff directly in the app
  3. Store staff only has access to and gets information that is directly relevant to them

 

A very practical way of migrating to an app suite as described could be the 1:1 roll-out. One feature set (app) is migrated to the app suite (or reproduced) at a time, for one market at a time. This is a high learning curve, low-risk approach that we recommend in ATOBI.

Click to see how other successful retailers do it.

We have had the pleasure of helping several organizations migrate from outdated legacy systems to our intuitive full-suite app platform. For example, we helped Calvin Klein drastically improve their mystery shopper results and a leading European Telco engage their in-store and customer service staff.

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