Online Retailers and the Mobile App Profit Dilemma

by Holly Shoemaker

A recent report from research2guidance reported that in 2012 most online stores made less than five percent of their revenue from a mobile app. 

Numbers at a Glance

The company surveyed more than 600 mobile-commerce companies and found the following:

• Almost 19 percent of e-commerce companies made more than 25 percent of revenue via mobile channels. 
• One third reported that they expected to generate more than a quarter of their revenue from mobile within the next five years. In addition, 15 percent of those companies reported that they planned to generate half their revenue from mobile apps.
• For online retailers to profit from mobile apps, they need to achieve downloaded numbers of more than two million. At this time, many online stores only achieve a few thousand downloads. 

Mobile Ad Spending to Grow

eMarketer predicts that U.S. mobile ad spending will reach $7.19 billion in 2013 and more than $20 billion in 2016. Despite those numbers, mobile only entails a small percentage of total ad spending. It comes in at just 2.4 percent. If the number increases as expected to $20 billion in 2016 that will bring the percentage to 11 percent – that means it will rank higher than radio, but will not overtake print.

Hope for Online Retailers?

The future for online retailers and revenue from mobile apps depends on the goods or services sold. Stores that sell virtual goods perform well. Companies that sell game apps and upgrades or virtual goods inside them also have a better chance at becoming part of the exclusive five percent.

RIM's Port-A-Thon Has Hours to Go

by Holly Shoemaker

Developers looking to make a little cash from Research In Motion (RIM), have a few hours left today. In anticipation of its BlackBerry 10 launch on Wednesday, January 30, 2013, RIM is conducting another Port-A-Thon, a 36-hour marathon that began at noon on Friday, January 18, 2013. In that 36-hour span, RIM will pay Android developers $100 for every approved app that gets ported over to BlackBerry 10. There is a a limit of 20 paid apps per developer.

Port-A Thon Rules

RIM has allocated $500,000 toward distribution, and to qualify developers must register and submit their apps into the BlackBerry World Vendor Portal by 11:59:59 PM EST on Saturday, January 19, 2013. Any app submitted outside that timeframe, will not count, and BlackBerry must approve all apps.

Valuable Sessions?

RIM sees value in these sessions, and the Port-A-Thon held on January 11, 2013 brought in over 15,000 apps. RIM ultimately needs to gain back consumer satisfaction and apps provide a way to do that. However, the company needs to hope that top apps get transported over and meet the needs of all stakeholders involved.