In our last blog we discussed the struggles that mobile marketers face while trying to engage and retain their App users. It has been captured in many studies over the last few years that acquiring a new user is 5 to 25 times costlier than retaining an existing one. Usually marketers that focus their mobile marketing efforts only around bringing-in new customers and not engaging/retaining the existing ones end up wasting 75% of your mobile spend.
Just a 5% drop in churn rate can easily boost your mobile revenue by 75%. Moreover, chances of conversion through your existing customers are between 60-70% while in case of prospective leads it’s between 10-20%. Customer churn rate is also an important metric in defining an app’s retention rate as well as customer lifecycle value. These numbers tell how the App is performing, thus helping mobile marketers build more accurate forecasts associated with scaling, growth and revenue.
Now that you are clear about the importance of customer retention in mobile marketing let’s move onto understanding App churn in detail and how you can calculate it for your App.
What is App Churn and how to calculate it?
Customer Churn is nothing but the percentage of users that either uninstall your app or abandon it during a particular period of time. For an App to improve its revenue, a steady increase in users is a must. But, when the number of users leaving the App is more than the users installing it, it means your App marketing is going wrong somewhere. Losing more users means huge mobile marketing budget lost in acquiring new ones.
Here’s an easy formula that you can use to calculate the customer churn rate for your App (quarterly):
Success of your app depends upon how efficiently you are able to manage your churn rate along with improving the conversions from the users you have already acquired. In simpler terms, churn rate is the opposite of customer retention rate.
Why do customers uninstall an App?
Yes, App churn is not something you would want for your business. But, it’s not something easy to determine since there can be numerous reasons that might make a user abandon your App. Worry not! We got some statistics backed reasons listed right here! Knowing these in advance and making necessary changes can help marketers reduce/prevent their initial App uninstalls.
- Poor customer engagement strategy: 60% users will uninstall an app that doesn’t offer them any value addition or fails to engage them with the right messaging.
- Insufficient Device Memory: Around 51% users tend to uninstall an app if it’s taking too much space in their device and they have a space crunch.
- Complex sign-up or usage: According to ITR, many App uninstalls happen if the users find the sign-up process or its usage too complex.
- Security/Privacy Issue: Around 30% users might uninstall an App because of security/privacy issue in case of apps where security guidelines are not clear or they are asking for too much of personal information.
- Messaging Overdose: Irrelevant push notifications or untimely overdose of messaging is the most popular reason for App churn. Around 71% users tend to uninstall an app because of it.
- Technical errors: An App freezing, crashing or showing an error too often leads to uninstall by almost 62% users.
- Longer loading time: Apps that take too long to load are more likely to be uninstalled by a user. Ideally an App shouldn’t take more than 4 seconds to open and work.
- Consuming too much data: More than 20% of users stop using a mobile application if it’s consuming too much of their internet data.
Along with these crucial reasons why a user might uninstall an App, here are few others that might lead to churn:
- A user is not using the app anymore or hasn’t used it in a while
- Users went through a poor onboarding experience
- The App has a poor interface or a confusing user experience
- There is a competition App offering better user experience
- The App is not offering enough new content or feature updates
- If the product/service offered by the App is poor or not a great market fit
- App asks too many permissions or shares/sends information without the user’s knowledge
- If the App only works properly on fast networks
How to prevent/reduce app churn?
Now that you are familiar with the reasons that lead to App uninstalls, let’s discuss few ways that can help you to prevent them.
- Create powerful customer engagement strategy
Filter your data for users who have high churn and low customer retention and try to spot trends in the actions they take. Then perform this process vice-versa. This data collected from both ends can provide learnings to strengthen your customer engagement strategy. Make sure you also personalize the interactions made based on this data instead of adopting a one-size-fits-all approach.
- Make your onboarding powerful
Win your user during onboarding itself by showcasing your core values. Remove complexity, limit the number of layers and make the user reach the best parts of the app as soon as possible. Efficiently utilize in-app messaging to make this process even stronger.
- Optimize messaging
Monitor and optimize the time and frequency of your push notifications and advertising to avoid overwhelming your user. Track reactions triggered by these notifications and ads to calculate the adverse effects.
- Do rigorous testing
Overcome uninstalls that happen due to App bugs/technical shortcomings. Avoid any such performance issues for the App by rigorously beta testing it before the launch. Regularly monitor such crashes/bug reports to remove any such issues promptly.
- Improve user experience
By tracking how users interact with your first experiences and where in that experience they tend to churn repeatedly, marketers can pinpoint bottlenecks and set up A/B tests to reduce churn. Also, collect user feedback through in-app surveys to continuously improve performance of the App. Data/parameters gathered through win-back campaigns can act as a major add-on here.
- Modify App Design
Retain users by making your App more user-friendly. Make sure that your App is compatible to all screen sizes irrespective of the devices. Provide simple and easy to read instructions and other setup information. Use appropriate links, navigation and anchor text for better user experience and avoid overloading it with features that could confuse the user. In case of a global app don’t miss out on localizing it for multiple languages.
Just like you measure other mobile metrics, first step towards reducing App uninstalls is effectively tracking them. Uninstalls tracked on a daily basis can identify the areas where the App or mobile marketing is lacking in keeping the customer satisfied. Unraveling such frictions will tell the marketers why an App uninstall occurred in the first place and what changes they can make in their marketing strategy, App UX or in-app performance to reduce them.
In its initial 90 days of installing, most apps lose almost 80% of their new users out of which almost 50% do this in the first 5 days.
Since the uninstall rate for an App is so high in the first few days of install, it is crucial for the marketers to make the most of this period.
Capture user info early
Encourage your users to interact with your app across multiple channels such as email, SMS, social media, etc. This will allow you to gather their information early on within the boundaries of privacy laws. This user information can be later used to run win-back campaigns for them in case of churn.
Run automated win-back campaigns
If a user hasn’t been active on the App for a while, it means he/she might have churned or is about to. In such a case, you can use the information gathered earlier to run persuasive win-back campaigns. Here, a marketing automation software will play a crucial role and automatically trigger an email or SMS in case a push notification doesn’t go through.
Use such communications to send them updates about your App like offers/discounts, new features/updates, new content added, etc. Also use this opportunity to run feedback campaigns to ask users the reasons they uninstalled the App and areas where you can improve.
Use this data collected through feedback campaigns to make necessary changes to your app to avoid/prevent users from churning in future.
Usually marketers have to spend a lot of time with their data team to crunch numbers about the App users they have lost. Even in that case the numbers are not accurate and the efforts and resources they should have spent on customer retention get occupied in the acquisition strategy. With intuitive analytics engine like Gamooga that comes with the power of machine learning, marketers can know the exact number of the App users that churned along with detecting the triggers that led to it.