How Rewards Apps and Mobile Shopping Are Shaping The Future of Retail and Omnichannel
By Allison Geyer
May 25, 2023
During the height of the pandemic, there was a massive shift towards e-commerce. The amount of time that Americans spent in shopping apps increased by 32 percent from 2019 to 2020, according to data.ai, the leading platform for mobile data and analytics, and that behavior has stuck around even as life has returned to pre-pandemic norms. Last year, consumers spent a staggering 2.8 billion hours in shopping apps, up from 1.6 billion hours in 2018.
But as engagement with mobile ecommerce platforms reaches new heights, the trend has also evolved – today, consumers are feeling the effects of inflation and looking for ways to stretch their dollars. These macroeconomic conditions have led to high demand for rewards apps, digital discounts, and alternative financing options like “buy now, pay later” (BNPL), all of which sit within the larger “shopping” category in the Apple App Store and Google Play Store. BNPL apps were the rising star of 2020, but their popularity has waned considerably. Today, coupons and rewards apps are the fastest-growing segment within the shopping category, with downloads increasing by 30% in 2022.
Fetch, the nation’s top rewards app with more than 18 million monthly active users, is the undisputed subcategory leader. Recognized by data.ai as a “breakout app” in 2019, 2020 and 2022, Fetch saw its downloads increase 35 percent last year, outpacing the overall coupons and rewards market in the U.S. Within the wider shopping category, Fetch’s download numbers are on par with ecommerce giants like Temu and Shein in the mobile-first shopping market. In fact, looking at a variety of engagement metrics, Fetch performs more like a social media app – and it’s the only loyalty app playing at this level.
“Fetch’s growth since its introduction in late 2016 has made the app a standout performer in the shopping category,” says Randy Nelson, Senior Director of Market Insights for Data.ai. Comparing the first quarter of 2017 to that of 2023, global shopping category downloads (not counting third-party Android marketplaces in China) have about doubled. “In the case of Fetch, its Q1 2023 downloads were 181 times greater than in Q1 2017. Compared to all apps, the multiple is even more in Fetch’s favor, with overall app downloads growing 1.5x in the same period.”
Ranking as a breakout app in multiple years isn’t unique, but it’s not very common, Nelson says. Looking at the top five shopping apps by raw year-over-year download growth each year between 2018-2022, only 4 of the 18 apps appeared in multiple years.
1. SHEIN (4th in 2019, 2nd in 2020, 2nd in 2021, 5th in 2022)
2. Fetch Rewards (2nd in 2019, 3rd in 2020, 4th in 2022)
3. Upside (3rd in 2021, 2nd in 2022)
4. Shop (1st in 2019, 1st in 2020)
Beyond pure growth, Fetch is a highly “sticky” mobile app – that is to say, it has a high level of user engagement and retention. Often measured by the rate of daily active users (DAUs) to monthly active users (MAUs), stickiness is a desirable trait for apps because it can lead to increased revenue, user loyalty, and long-term growth.
The overall stickiest mobile apps are the ones that are the most useful and engaging to users. These are the apps that users keep coming back to, even when they have other options available. The top performers have traditionally been social platforms, messaging apps, mobile games, and streaming services. Ecommerce apps tend to be less sticky than those heavy hitters, but within the category, shopping platforms like Amazon, eBay and Alibaba have traditionally seen the highest levels of daily engagement.
However, new players are disrupting the space. In March 2023, 34 percent of Fetch’s monthly active users were also daily active users – outperforming mobile retail giants like Amazon Target, Walgreens, Walmart, CVS, and Kroger. Only a handful of elite apps achieve daily engagement at this scale – think Facebook, Instagram, Snapchat. Fetch is approaching this level, trailing just 11 percentage points behind Twitter.
Fetch has the highest DAU/MAU ratio among the top 50 shopping apps, and it ranks in the 54th percentile among the top social apps. Only Fetch, Amazon, and Target would rank among the top 75% of Social apps by DAU/MAU.
“It is very rare for a shopping app to rank well among the top social apps,” Nelson says.
The secret to its success? Fetch is the most inclusive and accessible ecommerce app ever created. Consumers can earn rewards every time they submit any receipt, from any store or restaurant, plus online transactions. Because consumers are incentivized to digitize their entire purchase history – from both ecommerce and in-store purchases – Fetch has visibility into a 360-degree view of consumer behavior in real time. Fetch shoppers submit 11 million receipts each day – this amounts to more than $150 billion in retail spend annually, putting Fetch on par with the nation’s top retailers.
Fetch has also leveraged social features and gamification to create a fun, frictionless, joyful experience for users and by providing value in the form of rewards, highly relevant offers, engaging content, and more. The newly launched Fetch social experience appeals to core human desires, giving users the ability to connect with friends and family, compete for the top spot on the rewards leaderboard and against their own personal records, and engage with content on the activity feed.
It’s catching on and driving results – the percentage of users who engage with social features increased from 26.3 percent in January 2023 to nearly 50 percent today. These users also engage with the app more frequently, with monthly scan-return rates 4.4 percent higher than non-social Fetch users. The app’s Daily Reward feature – a spin-the-wheel game that gives users the chance to win a variety of point values – is another success story, boosting retention by about 5 percent for those who play. These features have been key to driving engagement and expanding the app’s user base beyond its core group of early adopters that included deal seekers, coupon enthusiasts and head-of-household shoppers.
In addition to delivering value for consumers, apps like Fetch provide a privacy-first way for brands and retailers to ethically collect and leverage data about customer behavior – a top priority for brands in the post-cookie era. This allows them to improve the customer experience, target marketing campaigns, and make better business decisions.
The Fetch platform’s approach to personalization goes beyond demographic cuts and directly leverages user behavior to create customized experiences and highly targeted audience segments based on previous purchase behavior. By effectively unlocking performance marketing for the physical world – a holy grail for advertisers seeking to optimize spend and understand performance across channels – Fetch is attracting the world’s biggest brands to the platform. This in turn creates more value for the end user in the form of more opportunities to earn rewards.
Mobile shopping apps have become a driving force within omnichannel strategies for both brands and retailers. A major promotional channel, these platforms have the power to both bring consumers into physical stores and drive online transactions. They allow customers to shop across multiple channels, including online, in-store, and through mobile devices, providing customers with a seamless shopping experience, regardless of where they are or what device they are using.
With consumers increasingly relying on the mobile experience for shopping, retailers and brands need to understand their customers and personalize their offerings to retain and gain new customers. In an increasingly competitive environment, the brands and retailers that partner with mobile apps can gain a competitive edge in the industry.
Allison, Director of Corporate Communications, is a contributor to the Fetch Blog.
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