Beyond the tap: How mobile apps impact retail sales

Unnati Narang never planned to pursue a doctorate, although it seemed like the natural thing to do. Her mom had a PhD, and her father was a physician. But Unnati started out as an entrepreneur, with a seemingly endless amount of energy to dedicate to her pursuits.

During her masters’ studies at the Delhi School of Economics in 2011, she co-founded a retail store for musical instruments – a business she started with two friends. Between managing the store, attending classes, and doing some teaching to pay off her business loans, she routinely put in 10-hour days or longer. It was exhausting work, but she loved it.

It wasn’t until her second startup venture — helping a marketing professor at Columbia Business School set up his online education business — that she began seriously considering a PhD. That’s when the seed was planted. From there, it was on to Texas A&M where she completed a PhD in marketing in 2020.

Her dissertation focuses on the impact of mobile marketing that, even during her early startup days, was changing the way customers shopped. She studies how mobile app launches impact large-scale retailers with a presence in multiple channels. Specifically, in her first dissertation essay, published at Marketing Science, she quantifies how an app launch affects revenues and in-store returns.

“What we found in this study was that not only does app launch lead to a 37% increase in how much shoppers spend, but also much of this increase comes from higher in-store purchases once they start using the app,” said Narang, who noted that on the downside, product returns increased, which may imply that mobile apps make people more impulsive. “The net effect was still positive. In fact, shoppers who came to the store to make returns were buying more on the same trip. When we shared this with the retailers, they were pretty pleased.”

It was during that study that she became intrigued by random app failures caused by server crashes. On one particular day, she observed as many as 2.5 million failures across all users. That intriguing discovery led her to study the effects those failures had on online and offline purchases.

While it’s still a work in progress, she and her co-authors have already made some interesting finds. For example, she observed a 7% decrease in customer revenues across all channels, with most of those losses coming from offline channels. She also says when the glitch happens is a significant boundary condition. For example, if someone is closer to completing their purchase at the time of failure, they are likely to go ahead and complete it by switching to alternative channels.

Narang, who will be teaching marketing analytics at Gies, says it’s important for students to understand what’s going on when they look at the numbers in studies like these. “A lot of times, there are cool new methods and complex algorithms that students find fascinating, but I really want them to learn about the intuition for why we do what we do.” She also hopes they’ll develop the skills they need to connect that marketing intuition back to the methods and interpret any analysis carefully.

It was largely Narang’s intuition that led her to accept an assistant professor position at Gies, shortly after it was offered. “I was fortunate to have many job interviews at top business schools, but I got sold on Gies! The school went above and beyond to make me feel valued and make an incredible offer early on. That made all the difference,” said Narang, who was impressed not only by the school’s past reputation but also by its future direction.

“I’m very optimistic about joining Gies,” she said. “I am looking forward to contributing to the growing focus on innovation, analytics, and online education at Gies.”