Want to purchase a new or used car? There’s an app for that. Need to meditate or pray? There’s an app for that. Want a running route in a city you’re unfamiliar with? There’s an app for that.
Want to know the weather forecast for this week in London? Yes, there’s an app for that too.
You might be wondering why there are so many apps these days and how they are changing the way we do business. To answer that, let’s start with a definition and some history.
An application is software designed to perform a certain function or functions. Originally the word application referred to software running on a desktop or laptop computer, while the shortened form, app, referred to mobile applications running on tablets and smartphones. In this article, we’ll use both terms to refer to mobile applications, which have seen tremendous growth over the last decade.
The rise of the application started with Steve Jobs, who envisioned a way to sell software over phone lines. In 2007, the iPhone debuted, and in 2008 came the Apple App Store with access to 500 applications, some of them free and some fee based.
The most popular applications in those days were for gaming. Angry Birds, released in 2009, was the Candy Crush of that decade; It had three billion downloads by 2015.
In 2010, the American Dialect Society named “app” the word of the year, and in subsequent years Google Play, the Amazon App Store and Blackberry’s App World added their versions of Apple’s store, which, by the way, coined the “there’s an app for that” phrase in a 2009 advertisement.
Over the last decade, application use has become part of a lifestyle, with everything from smart watch apps to count steps and calories to apps that control home appliances and other devices. Application development and use has exploded right along with smartphone prevalence.
According to 42Matters, a company that provides app intelligence and analytics, there were 3,201,812 apps available on Google Play and 1,916,651 apps on the Apple App Store as of May 4, 2024. RipenApps reported that the U.S. app market generated $44.9 billion in 2023, up $2 billion from 2022.
According to the 2024 Pew Research Center mobile fact sheet, 97% of Americans own a smartphone. That’s up from just 35% in 2011. Put another way, there were more than 310 million smartphone users in the United States as of 2023, according to Statista.
RipenApps also revealed several industries that saw a spike in application use from 2023 to 2024, including video chat and online conference apps (a 627% increase in downloads), finance technology apps (increase from 35% to 85% in mobile app banking), media and entertainment (25% usage increase and 54% increase in intake of streaming television), and online food delivery (market poised to reach $154.34 billion globally).
The mobile application development company named several industries poised to benefit from mobile applications, including information technology, retail, food and grocery, education, tourism and e-commerce.
The business case for apps
There is money in application development, and there’s certainly consumer demand. But businesses of all kinds can benefit from providing apps through which customers can make purchases and interact with their brand.
A 2023 survey from Reviews.org showed that Americans check their phones an average of 144 times per day. More than 80% of digital time online is spent on mobile applications, according to a recent Gartner report.
“Enterprises are leveraging this as a billboard,” said Mark Johnson, co-founder and managing partner for Michigan Software Labs, a national custom software developer based in Ada, Mich. “They really want to get that download” because it pushes their brand name — along with any messaging they want to convey — to their customers.
Most businesses have websites, but they’re “not that sticky,” said Johnson. They don’t draw you in and keep you coming back. You have to know the site address and either save it or type it in, whereas an application requires one click. More importantly, applications contain customer-specific information and can be highly interactive.
“Applications are getting better and better,” said Johnson, who noted that many large businesses are on second or third iterations of their apps. “Enterprises are focusing on developing high-quality applications because they’re competing against really sticky applications like Tic Tok. You need a high-quality user experience.”
One way companies are making their apps more “sticky” is by using artificial intelligence and machine learning to improve the user experience. For example, entertainment apps can recommend music, books and movies. Logistics apps can integrate route information with real-time traffic and weather data.
Johnson noted that applications are also more secure than websites, enabling companies to protect their intellectual property.
Beyond meeting customer demand and creating brand awareness, applications should either grow a company’s top line or fix its bottom line, Johnson said. The app should either increase revenue or save money, and sometimes it does both.
Revenue growth comes from increased brand awareness and sales. Cost savings comes from more efficient processes or using fewer resources. For example, apps can reduce paper use and make data management more efficient, creating “one source of truth” rather than multiple disparate sources that need to be updated and managed, Johnson explained.
Applications are becoming especially prominent in healthcare, finance and insurance, and logistics or supply chain management, said Johnson. Some examples he gave of innovative apps include John Deere’s use of vision technology to pick out weeds and remove them with lasers, fitness applications that make working out competitive and fun, and Amazon using applications that enable employees to compete against one another in scanning packages.
Applications in the banking industry
Gone are the days when you had to visit a bank to open an account, withdraw money or even get a loan. Online banking and banking apps are the way most people do business. The main functions bankers look for in mobile apps are basic tasks like transferring money and writing online checks, security features like being able to set limits on debit cards, and notifications of overdrafts and payments.
In a 2022 study by eMarketer (formerly Business Intelligence), 89% of survey respondents said they use mobile banking, with 97% of millennials indicating mobile banking use.
“It’s an expectation now,” said Kelli Ellsworth Etchison, chief marketing officer and chief diversity officer for LAFCU. “There are people who won’t go to a physical branch.
Ellsworth Etchison said her credit union, which has 10 physical locations in the Lansing area, views mobile banking as simply another branch offering the same services as an in-person visit would. Customers can fund a certificate of deposit, transfer money, apply for a loan and even learn via banking tutorials, she said.
“The majority of our members use online or mobile banking” which are essentially the same, she said. LAFCU has 74,000 members, and 64,000 are enrolled in mobile banking. LAFCU boasts a 93% mobile banking retention rate, she said, meaning customers who sign up continue to use the service.
Ellsworth Etchison said that, even though mobile banking will likely increase, LAFCU will still need employees and will staff branches. “There are still going to be people who come into our branches because of that community feel,” she said.
Grocery apps gaining popularity
While grocery and food apps were around before 2020, the pandemic increased their popularity, as consumers looked for ways to safely procure food. Instacart, which offers mobile shopping with same-day delivery or pickup, peaked at some 2.7 million downloads in April 2020, according to Statista.
While Instacart is still the most downloaded grocery application, grocery stores have developed their own applications for online shopping, inventory checking, coupon clipping, curbside orders and more.
In fact, recent price increases seem to have boosted grocery apps’ use. According to Apptopia, grocery app user sessions went up 77% from May 2021 to May 2022, with reviews mentioning the word “coupon” up 75% from April 2022.
Matt Van Gilder, director of e-commerce and digital experience for SpartanNash, a global food retailer, wholesaler and distributor based in Byron Center, Mich., said his company’s e-commerce pickup and delivery program launched in 2017. “Since then, we have grown our offering to include our program and additional partnerships with programs like Instacart, DoorDash and Uber,” he said.
“Our newest mobile app, slated to release later this year, will include both an integrated loyalty rewards experience as well as an integrated shopping experience,” Van Gilder said.
These days, SpartanNash’s Family Fare application and website enable customers to create shopping lists, check weekly specials, clip digital coupons and view loyalty rewards, Van Gilder explained. App use continues in the store, where customers can reference shopping lists, scan items to add digital coupons to their accounts, and redeem coupons and rewards at checkout.
Van Gilder explained that customers who don’t want to visit the store can request home delivery or curbside pickup via the app.
“While we are focused on e-commerce as a driver of sales, it’s important to note that 90% of consumers are still shopping brick and mortar, so all digital efforts must be planned and executed from a true omnichannel approach,” said Van Gilder. “This is something we prioritize in our stores and with our independent grocer customers.”
SpartanNash is also aware that “not everyone wants another app,” said Van Gilder. His advice to grocers in developing digital functionality is to design for users accessing both the mobile app and the mobile web.
“Also, prioritize making the digital process as frictionless as possible (e.g. allowing consumers to access a retail site as a guest without having to sign up for an account),” he said.
The medical field
As technology has advanced, so has medical data management, and with it, application development and use. As in the grocery industry, health care apps became a necessity during the pandemic, especially with respect to telehealth. According to Statista, the global digital health market was valued at more than $330 billion in 2022 and is projected to exceed $650 billion by 2025.
But not all medical apps are directed at consumers. For example, SxanPro, launched in 2020, helps hospitals better inventory their medical devices. Ashlea Souffrou, CEO and founder of the Grand Rapids, Mich.-based company, said her application aggregates manufacturer data for disposable devices like sutures, implants and syringes. For each product, the application houses lot and serial numbers, the expiration date, the unique device identifier or UDI (a government requirement) and manufacturer information.
Souffrou founded SxanPro after working in the medical device industry, where she had to painstakingly write down UDI codes and look up expiration dates for inventory control. The mobile technology she created not only reduces labor but allows hospitals to more efficiently identify medical device waste and alter purchasing processes to gain efficiencies.
Souffrou said SxanPro can be integrated with a hospital’s purchasing and accounting software to maximize the return on investment. It currently includes five million products and is still growing.
Entrepreneurial apps
Many applications fall into the realm of entrepreneurial startups — software that serves a specific purpose for a specific group of people. Farmish fits into that category.
Terra Osman, founder and CEO of Grand Rapids-based Farmish, developed the application while looking for locally grown food sources. There’s a trend toward people growing and producing items on their own in small batches, and community members want to buy from those small growers, she explained. For example, someone might keep chickens and sell the eggs. Another might keep bees and sell the honey.
“We call it social media for local farms,” Osman said. Farmish replaces Facebook Marketplace, which is where people would often advertise and purchase such items, albeit illegally, since the platform doesn’t allow the sale of eggs, food, chicken, animal food or compost. They would use code words to circumvent the rules, she said, but would sometimes get shut down.
Farmish debuted in March 2022 and had 100,000 downloads in the first eight weeks, Osman said. Today, almost 20,000 farmers and growers list products on the application, and there are users all over the United States and in Canada. Farmers can list up to three products for free, and there’s a charge for additional listings.
“We’re working to monetize local growing,” said Osman. “We want to do what Etsy has done for crafters. Our farmers want to build a brand.” On Farmish, they can include information about growing and producing methods, unique products and more.
Buyers can follow farmers, get notified with something new becomes available, and receive notifications when there’s a new farmer in their area.
Osman said Farmish echoes what she called the “unbundling” of Craigslist. Over the last decade or so, commerce tools like Poshmark and Airbnb became available for specific items that were previously bought and sold on Craigslist. “People started to ask, ‘what if this was its own thing?’” Farmish “unbunbles” consumables like homegrown eggs, produce, trees, honey, plants and more.
“Farmish cuts through the noise of what people see on social media,” Osman said. For example, Facebook Marketplace often shows items for sale that aren’t local to a buyer’s area and includes advertisements in search results.
Farmish began by offering listings to homesteaders and recently expanded to include listings for commercial farmers, Osman said. Now, there are 900 farms on the waiting list to sell wholesale, and they’ll be onboarded in the coming months. In the future, Farmish could expand to include food brands and niche food companies.
Best practices in app development
If you’re looking to develop or enhance an application for your company or as an entrepreneurial initiative, Johnson advises working with a local partner. “You really don’t want someone offshoring,” he said. “Look for a home-based team that can meet in person.”
Other best practices for application development include human-centered design, building capabilities that will add value for the user and focusing on functionality that will add the most value for the company, said Johnson.
In case this article inspires an entrepreneurial spirit, check out some 2024 application ideas from BuildFire.com, which provides a platform for building mobile applications. The ideas solve problems like finding places to donate food, finding a parking space, translating speech, choosing fashionable clothes and accessories, and even preparing for emergencies at home and in the workplace.
