Apple debuts 'shopping' category in App Store

Dive Brief:

In time for the holiday shopping season, Apple will launch a new “shopping” category in its App Store on November 5, Fortune reports.
The new feature is designed so that shoppers will be able to find e-commerce apps from retailers like Amazon and J.C. Penney, as well as coupon apps like Groupon and product review and price comparison apps in a single place. Previously they were listed in the “lifestyle category.”
The App store’s shopping category will also include a section dedicated to shopping apps from brands such as Sephora that incorporate Apple Pay, Apple’s mobile payments technology.

Dive Insight:

Apple's move reflects companies’ accelerating efforts to monetize the role mobile devices are playing in consumers’ shopping journeys.

This month, Facebook also announced plans to roll out a separate shopping tab to its mobile app, culling all items for sale on Facebook in a single place.

According to Forrester Research, mobile commerce is expected to grow to $252 billion by 2020, up from an estimated $115 billion this year, Women’s Wear Daily reported. Nonetheless, most mobile transactions happen on retailers’ Web sites, rather than in apps. “The challenge with apps is that shopping apps don’t get enough frequency of use for most merchants to make it useful to download them,” Forrester analyst Sucharita Mulpuru-Kodali told WWD.

Making a purchase using Apple Pay in a shopping app could help reduce the primary challenge retailers face in capturing sales on mobile devices: the clunky checkout process.

Indeed, cart abandonment on smartphones is high, as the process of entering credit card information on the small devices is arduous and timely. But Apple Pay eliminates those steps.

Jennifer Bailey, vice president of Internet services for Apple Pay, said that mobile shopping has been the fastest-growing ecommerce segment, especially in apps.

She pointed to Panera Bread as one success story. The fast-food chain started accepting Apple Pay in stores and within its mobile app last year. Today, 20% of all of Panera’s transactions from customers are now coming via Apple Pay, she told Fortune.