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Does Your Small Business Have an App? Should It?

2 min read • Oct 05, 2018 • Grant Olsen

Consumers downloaded about 178 billion mobile apps last year. And by 2022, the number of downloads is projected to rise to more than 258 billion.

Yes, apps can be big business. So are they a good investment for your small business?

To help answer this question, Clutch surveyed 350 small business owners from around the country. About 40% of small businesses report that they have a mobile app, which is a nearly identical percentage to last year’s data.

Clutch offers insight into this apparent plateau of small business app usage, pointing to the fact that 28% of small businesses report that they built their app primarily to attract new customers. Experts say this shouldn’t be the primary goal, as the hoped for results may not materialize. Interestingly enough, Clutch’s survey revealed that an app’s most common benefit to small businesses is typically found in mobile payment.

Unsurprisingly, small businesses owned by millennials lead the way when it comes to app usage. Indeed, 55% of such businesses have an app, while only 13% of small businesses owned by a baby boomer use one.

Across all demographics, 30% of small business owners plan to create an app in the future. However, plans shouldn’t be taken as gospel, as many of the businesses that reported last year that they’d build an app in 2018 have yet to follow through. Woody Zantzinger, vice president of business development at app development company WillowTree, Inc., explained in Clutch’s report that the lack of follow through is often due to small businesses not understanding how expensive and time-consuming it is to develop an app.

“With less capital and smaller teams, I would expect these barriers to be even harder for smaller business to overcome,” explained Zantzinger. “Most companies where mobile is core to their bottom line have already explored and built mobile products. If a company doesn’t have an app by now, I’m not sure what could change their mind.”

The takeaway from Clutch’s research is that while mobile apps provide value, they only work effectively when developed to meet specific goals for a targeted audience. Fear of missing out (or FOMO) should never drive the decision.

If you’re unsure of whether an app is right for your business, Clutch recommends a simple decision process. Examine your customer journey and see which customer touchpoints could be improved with an app. Based on this focused evaluation, if you’re confident that an app would positively impact your business, deploy the simplest and most cost-effective version of your app first.

Then, sit back and watch. If the app doesn’t take off, you’re not too deep in the hole in regards to cost and manpower. If, however, the app proves to be a valuable asset, you’re primed and ready to continue developing it.

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Grant Olsen

Grant Olsen is a writer specializing in small business loans, leadership skills, and growth strategies. He is a contributing writer for KSL 5 TV, where his articles have generated more than 6 million page views, and has been featured on FitSmallBusiness.com and ModernHealthcare.com. Grant is also the author of the book "Rhino Trouble." He has a B.A. in English from Brigham Young University.