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5 tips to improve your retention rate

With the mobile world growing faster than ever before, many entrepreneurs and app connoisseurs are turning to the mobile app industry to form their ideas into reality. Launching an app might seem to be a tedious journey, however, what defines the success of each app are users. App tend to approach ad networks for user acquisition, although most of the times the results are tons of non loyal users and a big bill at the end of the month. It is a very common thing to see hundreds of users that install and open the app, but then never really use it again. This problem of low retention rates is very common among app developers. So, how many users actually uninstall the app or stop using it regularly after downloading it, and how can this be changed?

Only 23 percent of all daily active users keep an app three days after the install

Often times, users download an app, use it for a day or two, and then move on and never use it again or use it very little. This is a common weakness of app developers utilizing CPI campaigns. Retention rates are actually rather surprising when you think about how much money is in the mobile app industry. According to Silicon Valley analyst Andrew Chen, the average app loses 77 percent of its daily active users just three days after installing the app. There are millions of apps available and only a small percentage are actually able to retain those users over a period of time. He also states that after a month, 90 percent of daily active users stop using the app and only striking 5 percent still use an app after 90 days.


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Three Month Average User Retention by Industry; source: Localytics


The first few days of app usage are very important to the apps conversion of loyal users. According to Ankit Jain, the first week retention is the most critical period to obtain these users. The very low average retention rate could be explained by the fact that many users download apps to try them but stop using the ones they aren’t satisfied with in the first 3-7 days. Many users that stick with the app for the first week will likely keep using the app into the future making the first week retention rate very critical in gaining loyal users. Some conclusions for why most apps have trouble retaining its users are relevant. The most successful apps, like Uber for example, make the user feel as if it’s a necessary part of their daily life. These apps make up a small number of all applications, but retain a lot higher percentages because people feel that they can’t move on without it.

The 5 keys to nail your app from very beginning

It is evident that the first week of usage is vital in retaining long time users, but how can the app be created to attract these users in the important period of time talked about previously? Below are five key steps to take to increase your apps chances of solidifying these users as long time users.

1. Enhance easy onboarding

Finally you got new users! But what to do now in order to keep them and engage with your app? Make them love your app and show them why they really need it! Apps that involve a lot of steps in order to begin using the app often turn users away. The easier it is to being using the app and the less actions required, the more likely the user is to keep using the app. Furthermore, users have a creative mind and they care about the visual effect in you app. Creating an onboarding which has an appealing design makes users more likely to keep an app. Personalization, progressive learning, funny pictures, effective tutorial which highlights the competitive advantage often do not leave a user cold-hearted. In fact, a fluid onboarding increases lifetime value by up to 500%. So do you forget that the first impression counts so make them everlasting.

Example of popular onboarding animations


2. Stay transparent with your target market

Each app developer needs to coordinate activities so one can support each other and maximize the profit. Developing a great application is not enough but an effective marketing strategy can make an app a success what also also includes knowing your target users. In order to do this, find out who are your target users. Discover who is interested in using an app on long­term basis and establish your planning.If you find difficult to research your user base, an app promotion network can help you to figure out! With a low budget campaign, a developer can identify the most valuable group of users who have potential to stay loyal. But this not the end of journey! After this exhausting process, it is crucial to keep and interact with users. If users feel like that they cannot build on trust, they have no reason to retain an app. The solution? Get naked with your users (a.k.a. be transparent).

3. Set up straightforward push notifications on point

Appropriate push notifications that are not obvious and won’t potentially annoy the user have proved to be beneficial. In fact, notifications that relate to users preferences have a 54% conversion rate, versus 15% from broadcast notifications. It can be used to help remind users that your user is more useful among others as well as for targeting messages. Users that allow push notifications display 88% higher app engagement over those that don’t. Let’s take the example of Moovit – a global app which is designed to navigate public transportation and make you travels easy. As the public transport is very unpredictable, Moovit gives you control over it. Each user receive notifications which are updated constantly according to your route. Useful notifications tell you if the bus is coming, which stops is yours of if the station is closed. Due to smart notification which do not go over the top, Moovit is trusted by 40 million riders across more than 850 cities.


App Engagemenet Increase in Retention Rate; source Localytics


4. Drive the ‘freemium’ model and incentivization

The ‘freemium’ model has become a trending hit for many apps as it gives away a core product in an app what allows user to test a specific feature. Developer might be skeptical about this, but apps with freemium models account for 98% of the revenue in Google Play and 95 % in iTunes. American entrepreneur, Chris Anderson explained in his book “Free” that this model works on five percent rule – 5 % of paying users support the remaining 95 % of free users and keep servicing of free users close to zero. The second key element can be incentivization. Providing users with incentives like rewards, coupons, promotions, special access and more can do a lot to increase app retention rates. For example, the Starbucks app utilizes a reward system incentivizing users to use the app and collect stars to be rewarded free drinks and food. Well thought, relevant incentives can be extremely beneficial in retaining users of your app.

5. Boost the app upgrades and development

Updating the app experience and adding new functions on a constant basis are a key method in keeping the user interested in your app. It is important to use analytics of user behavior and feedback in order to determine what can bring your app more value and make it more enjoyable.

In a nutshell

So, as an app developer, the best way to set yourself apart from others and have high retaining apps is to concentrate on the first week of usage with high focus on the first couple times the app is used. Carefully planning and creating your app based around the five tips discussed will increase your chances of attracting users throughout the first week prior to when the app was downloaded.

1 reply
  1. Daniel
    Daniel says:

    Do not forget to avoid implementing TOO many Ads (especially Intersticial Ads)… People hate excessive Ads when using apps and uninstall.

    Best! 😀


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