When creating a mobile application, developers must keep in mind two things: app engagement and retention – metrics that reflect the success of their product. Low app engagement and retention are not beneficial to the product’s success, while higher rates prove the opposite.
Mobile app engagement and user retention make up an application’s “stickiness” – how loyal and engaged users are for it. For many organizations, especially ones that aim for monetization or user conversions, the most important goal is to keep their users interested to ensure repeated usage, as profit is more guaranteed with a solid number of users and related activities on every app, in this article, we will cover what you need to know about Mobile App Engagement and Retention, how it could tremendously impact the mobile app business nowadays.
1. What is mobile app engagement?
As it might suggest, mobile app engagement is why users have a reason to keep coming back to the app or open it to perform any intended action. The term “Engagement” itself describes how active users are on the application.
Mobile app engagement addresses all kinds of interactive activities that a user has with an app. This metric helps businesses determine the Return on Investment (ROI) on the app development, customer acquisition costs and plan out further suitable marketing strategies, which is very important to their success or failure.
2. App engagement metrics
User engagement metrics are plentiful and which one to choose should depend on the need of the organization and the mobile app category. The number of items added to carts, cart abandonment rate and lifetime customer value, for instance, is something that E-Commerce apps will pay attention to. However, for social media apps, audience interaction, the amount of time they spend on the interface, number of clicks, comments, shares, likes, and views on a post is much more needed to keep track of the app’s performance.
Below are some of the notable mobile app engagement metrics that companies should keep track to figure out their app development progress and how users adopt it. Additionally, they help business goals and marketing efforts aligned more effectively.
- Exit rate: Exit rate lets app makers know the percentage of visitors who click away to a different page from a particular page/screen on their own app. By telling where people usually leave in an interaction, developers will have an idea of the least converting part that needs to be improved.
- Number of Downloads: Simply put, the more downloads an app gets, the more users it has, although companies should also keep track of the number of repeated downloads from the same users to avoid vanity metrics.
- Active Users: This indicates the number of users who use your app regularly. The number of active users is the core metric for determining how well an app is doing with new users.
- Session Length: The amount of time someone spends on an app with any particular interaction.
- Session Interval: This figure represents how many times a user opens the app to interact with it. The interval between two consecutive sessions is used to calculate it.
- Lifetime revenue: This number indicates the total revenue from a customer before they stop using the app. It is one of the key metrics and is instrumental in growing a successful mobile app business.
3. What is user retention?
It won’t matter how many downloads an app has if it couldn’t retain the number of users, hence the importance of The User Retention Rate and why it’s very insightful in most cases. User retention rate is the percentage of people who continue to use your app over a given period (week, month, or quarter) and the inverse of User Churn Rate. (If a retention rate for a specific period is 25%, then logically the churn rate is 75%.)
Retention rate is also the most effective way to measure an app’s popularity and overall performance. The fact that engagement rates can vary across app categories makes retention rate a reliable indicator, it points out where an app needs improving or what the growth trends are so that the developers can think of the most suitable solution.
4. What is a good retention rate?
What makes a good app user retention rate relies on the app’s industry, marketing strategies, user base or business model, or many other factors. For some apps, this is the recurring subscriptions, in some other cases, it’s about in-app purchases or one-off visits.
Although exact benchmarks vary by industry, mobile apps on average have a 30-day Retention Rate of 42% and a 90-day Retention Rate of 25%. The average 30-day rate broken down by industry ranges from 27% to 43%, but for higher-performing apps, that range is 32% to 66%. More details can be referenced here.
The user retention rate can be high or low when an app is first deployed. But in the long run, one either starts to profit along the way or loses both money and users if a proper business plan is not guaranteed. A low retention rate means that the percentage of user churn is equal to or lower than the percentage of user retention. A high retention rate is when the number of attracted customers is greater than the number of left customers, resulting in a stable growth in the user base. With a high retention rate, users will bring more profit to the business over time.
5. What affects user retention and app engagement?
There are several factors that drive users to leave an app, such as the unfriendly interface, excessive show of ads, considerable loading time, etc.. Many feel intimidated by the technical complexity when they first approach a new app, or in some other cases, a competitor may know how to offer much more attractive benefits to new customers.
6. How to make mobile apps engaging and retain users?
All and all, the success of a mobile application depends on how well the app can attract users. To obtain this, the product team in question must develop suitable mobile app engagement strategies that would help them retain app users effectively. Below are some of the known methods:
6.1. Efficient onboarding
Onboarding is a series of screens that guide users through the app features and interface, essentially showing the benefits, promotions, how to register, what data is collected for in-app personalization.
This process is a user’s first impression of the app, so developers should keep this in mind to make the newcomer’s experience a pleasant one, as it reinforces the app’s value and increases the likelihood of successful adoption. According to this research, effective onboarding can make the retention rate increase up to 50%.
6.2. Push notifications
These notifications pop up without users having to actually open the application, so it’s an effective method to attract people, especially messages that cover exclusive offers, onboarding, personalized advertisements. The statistics from Invespcro showed that 65% of users return to an app within 30 days when push notification is enabled.
6.3. In-app messages
In-app messages are best used with push notifications to make users keep coming back to the app. They draw the necessary attention to new features and updates, highlight special offers, take advantage of the visual values of images and illustrations. App user retention could benefit from such user-oriented sessions.
6.4. Incentivization Program
It’s critical to seize the opportunity if a business model allows the provision of a usage-based rewards, loyalty program, time-sensitive discounts for dedicated users. These programs encourage customers to use the product while making them feel valued and important to the brand.
6.5. Encourage Two-Way Communication
Building relationships between customers and brands is a good way to solidify an app business. Consumers’ feedback lets developers and marketers know where to improve their products, solve technical problems over time. Moreover, this is a chance for them to avoid possible issues before the app is poorly reviewed in the store, thus showing responsibilities to boost long-term engagement and retention rates.
6.6. Optimized App Quality
The app makers’ responsibility is to create products that work smoothly and bug free because that ensures customers’ interest. An app being optimized to avoid crashes, slow loading times or lags is crucial to the process, as these can not only cause users to uninstall the app, but also have an effect on all marketing metrics derived from app interaction. It is through careful testing and quality check that this problem is mitigated.
6.7. Understand Your Market
The secret to developing an effective engagement and retention plan is first to understand your audience. When apps can develop habit-forming behaviors in their users, they are considered effective. Having billions of users on social media, apps like Facebook, Instagram, and Uber actively study their users’ problems and develop ways to solve them. Enough trust from the community means that there will always be a steady stream of users to ensure a good retention rate.
6.8. Email marketing
Email marketing is one of the key aspects of user retention. Devices like smartphones and tablets make it super easy for users to check their inboxes on-the-go, which is probably why mobile devices accounted for at least 50% of all read emails. Emails allow advertisers to communicate with consumers more effectively and profit from beneficial scenarios for both ends. Upon registration and through various online activities, businesses can obtain some user data and email for further promotional purposes.
By notifying customers of exclusive offers, you can ensure that they feel rewarded for their loyalty while also increasing profit. Email marketing is much more direct than social media marketing since it can reach many people’s inboxes at once, so email personalization and clear statements are also very important to ensure that every delivery is effective and every mail can get to their intended prime audience.
6.9. Social media marketing
Social media is an ideal place to launch offers and hype things up for app promotion, especially when the CoronaVirus pandemic resulted in an increased interest in social networking, with billions of people in lockdown, working and studying from home, and in need of socializing, according to Statista. Businesses can reach out to their potential consumers when having an active presence on multiple known platforms like Instagram, Facebook, Twitter or TikTok. Those are where they can convert new users through proper advertisement implementations and attract returning users for a higher engagement rate.
6.10. Implement Activity Feed and facilitate content sharing
An in-app activity feed works the same way as a social media feed does, it show the progress and interactions made between a circle of friends and families, creating an engaging community, the stronger it is, the higher user retention rate is. In the same context, the in-app content sharing feature makes customers hooked to their activities, for instance, creating a sense of competition in online games, as a result, their app session length will expand and contribute to profitable app performance.
In 2020, the number of mobile users worldwide stood at 6.95 billion, with forecasts suggesting this is likely to rise to 7.1 billion by 2021. It shows how the mobile industry greatly impacts our lives, especially with the COVID pandemic. More and more people are engaging in online activities with their phones while staying at home. Social media giants have made huge profits by understanding what needs to be done in order to get their customers entertained, so it becomes clear that a business’ success is based on how well they can retain their users and how engaging their applications are.