The Mobile App Truth: User Retention is Cheaper than Luring New Customers

According to a recent story in WhaTech, from 80 to 90 percent of the apps downloaded onto a mobile device are opened just once, before being completely uninstalled. That’s sorry news for app developers and marketers. But one of the issues that has been analyzed lately is user retention. And as it turns out, that’s …   Read More

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The Mobile App Truth User Retention is Cheaper than Luring New CustomersAccording to a recent story in WhaTech, from 80 to 90 percent of the apps downloaded onto a mobile device are opened just once, before being completely uninstalled.

That’s sorry news for app developers and marketers.

But one of the issues that has been analyzed lately is user retention. And as it turns out, that’s cheaper than constantly spending money to seek new users.

“Retention has transcended to becoming a highly objective metric to measure how users find your product or service,” notes WhaTech. “Market research suggests that even a 5 percent increase in customer retention can lead to increasing profits by 25 percent to 125 percent. There is a 60 to 70 percent probability of selling to existing customers while that of a new prospect is just 5 to 20 percent.”

Why does this matter?

“User retention should matter because it is expensive to lose even a single consumer,” adds WhaTech. “According to a report from KISSmetrics, businesses incur up to 7 times more expense in acquiring a new customer than in retaining a current user.”

There are other benefits, too.

“User retention should matter because consumers associated with a product or service for a long time are likely to evangelize for the particular products or services,” the report concludes. “They can turn out to be your advocates if the particular product is an inherent part of their weekly routine by taking it to the workplace or talking to their friends.”

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