Mobile is almost a perfect boon for retailers. Operative word: almost.
Mobile has surging traffic growth, now driving half (at least) of the traffic to U.S. retail sites. Smartphones are widely distributed — 68% of U.S. adults have one. BUT, mobile still tends to convert at about half the rate of desktop.
Mobile conversion has plagued us for years and yet no one has upended the current experience to deliver a superior solution. With the present state of affairs, we’re dealing with a lot of friction — slow page loads, multi-step checkout processes, forced account creation, and site redirection.
These problems come up, in part, because product discovery and shopping happen in a browser — a technology originally developed for desktop access to the Internet. When the browser was repurposed for the mobile environment, the product discovery and checkout process came along with it, and it led to a shoehorned result.
Mobile shopping doesn’t have to be this way. What if we could bring the mobile shopping experience out of the browser, closer to the consumer, and make it more native within the mobile environment?
It’s an idea that Google and Apple seem well positioned to turn into reality.
The Rise of Google PLAs
Take a look at what’s been happening with product listing ads (PLAs) on Google Shopping lately. Google PLAs delivered nearly double the revenue to retailers in Q2 year over year, according to new data we released last week. That surpassed PLAs’ 52% YoY revenue growth in Q1.
Mobile was a major growth driver. In fact, Google PLAs on mobile have shown triple-digit revenue growth all year, surging by 261% YoY in Q2. That topped the 164% YoY revenue growth we saw in Q1. Return on ad spend (ROAS) for mobile PLAs also grew in the second quarter, improving by 29%.
When it comes to conversion rate, Google PLAs were true to the industry trend. In Q2, PLAs on mobile converted at 1.8%, while those on desktop (computers and tablets) converted at 4.2%. There is a clear opportunity in Google Shopping to bring mobile conversion on par with desktop conversion, or even best it, using an already strong mobile ad format as the foundation.
How can we get there? That’s where Apple comes in.
Put the Spotlight on Product Ads
iPhones hold nearly 43% of the U.S. smartphone market. Consumers are accustomed to the tap-and-swipe experience that iOS delivers. However, its native search technology, Spotlight, is probably one of the most underused tools on an iPhone. Swipe right or pull down from the home screen, and you’re in Spotlight, where you can search apps and get suggested content tailored to your interests, such as news articles and movie listings.
Imagine if those results — whether by search or suggestion — included Google PLAs. Product discovery would become one swipe away. No need to wait for a browser to load, or to force a desktop-born experience into a mobile moment.
Rather, a consumer could quickly search and locate products within a mobile-first environment. And Spotlight already has the look and feel of a PLA channel, with rich previews of each result and thumbnail images that lend themselves to product perusal. It could look sort of like this …
Then there’s Apple Pay. What if it were integrated into those PLAs with a buy button, letting consumers purchase their chosen item and send it to their default shipping address, with just a fingerprint?
Apple announced earlier this year that it is expanding its payment service to mobile websites. Why not take this a step further to support consumer behavior of the future, rather than the past (as Apple is famous for doing), and enable it for native purchases on the iPhone?
There is probably opportunity to develop native product discovery functionality on Android phones, too. However, it’s hard to say whether that functionality would be as pervasive across Android phones as it could be across iPhones. That’s because Android is open source, so features, functionality, and version levels thereof vary wildly. Apple’s closed ecosystem, on the other hand, would give it control to ensure all iPhones have the same native product discovery experience.
Product Discovery Doesn’t Have to Happen in a Browser
Whether Apple Spotlight is the answer or not, the mobile conversion solution seems to hinge (in part or in totality) on making product ads more native to the mobile environment. Product discovery doesn’t have to happen in a browser. It can be rethought, brought closer to the consumer, and deliver a mobile-first and mobile-appropriate experience.
Could Google product listing ads appear one day in Apple Spotlight on iPhones?
Apple and Google appear to be in powerful positions to capitalize on that opportunity, and help address the mobile conversion problem by converging Google’s expertise in product advertising with Apple’s commitment to the mobile space.
Our smartphones are organized around our preferences and interests. Make product discovery a natural part of that. And let’s see if we can take one step closer to closing the gap between mobile traffic and mobile conversion.