Fab.com: Mobile app users deliver twice the revenues of website users

Fab.com, an e-commerce site that saw a surge in revenues of 550 percent last year and its membership base jump from 1.5 million to 12 million people, has found customers using mobile apps deliver twice the lifetime revenues of those on its website.

Computerworld UKspoke to Jason Goldberg, founder and CEO of the site which sources products from over 9,000 suppliers to act as a single source for unique design products.

Some 30 percent of Fab’s revenues came from Europe last year – with the UK making up 30 percent of these.

Fab develops all of its apps in-house, where it has built up a technology development team of 100 people, out of 600 employees at the company, in recent months

“We think about the Fab mobile customer first. Most companies build features for the website and then take those features to mobile. We aim to optimise for the three screens users typically use during the day – iPhone in the morning, desktop during the day, and then iPad in the evening,” said Goldberg.

“For us, a customer that uses the mobile app, versus one that uses a desktop, is delivering twice the lifetime revenue. They are buying more items per order and they are purchasing more frequently. What this means is that we have to get that mobile app into as many hands as possible.”

Goldberg said that in the US sales via the mobile app are already on average 35 percent, and has even seen some days of it reaching 50 percent of orders. In the UK this figure is 20 percent during the week and 35 percent on weekends. However, the UK app launched almost a year after the US one so has plenty of room for growth.

He said: “We really think that we will see a day when 50 percent of all our sales are coming from mobile devices.”

Interestingly, given that recent reports have indicated that Android’s market share has reached above 70 percent of the smartphone market, some 95 percent of Fab’s mobile sales are coming from users of the iOS app.

Goldberg is also seeing most sales coming from the iPad specifically.

“Android is 5 percent of our mobile sales, and iOS is 95 percent. Android is starting to grow, but iOS is far more dominant right now. Android users just don’t seem to be buying apps and purchasing lots online – maybe it’s because Android is operating on some cheaper phones, rather than the premium ones,” said Goldberg.

“We find that people who use the iPad app have the highest lifetime value of all our users. I sometimes joke that I wish I could buy every Fab user an iPad!”

He added: “We also aren’t really looking at the Windows platform right now, we see so much success with iOS, that that’s our focus.”  Finally, Goldberg said that because all the development on the mobile app is done in-house at Fab, development is carried out with an agile approach.

“We are constantly iterating, we do a release once a month. We are in a two or three week development cycle, then we ship it to Apple, which takes about a week for them to approve,” he said.

“We do wish we could do updates even more frequently, but that’s just the iOS platform. We ship code every single day on the web, but on iOS we are only able to do it once a month.”

Copyright © 2013 IDG Communications, Inc.

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