What You Missed in 2016: Data Science Year-in-Review

The following is a guest contributed post from Momchil Kyurkchiev, co-founder and CEO at Leanplum, the marketing cloud for the mobile era. In 2016 people spent more time than ever on mobile devices, with 90 percent of their time on the device dedicated to mobile...

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opinionThe following is a guest contributed post from Momchil Kyurkchiev, co-founder and CEO at Leanplum, the marketing cloud for the mobile era.

In 2016 people spent more time than ever on mobile devices, with 90 percent of their time on the device dedicated to mobile apps. And when it came to closing the buying funnel, mobile was responsible for a larger percent of digital sales than ever before. In fact, according to Recode, last year’s Black Friday was the first $1B mobile shopping event in US history.

Amid all these transformations, Leanplum, a mobile marketing platform, released three in-depth data science reports that unveiled the key trends to increase app retention and drive greater ROI. These reports include:

  • Breaking Barriers revealed the times apps send messages versus when people open push notifications around the world.
  • Personalize or Bust examined the impact of personalization on app engagement.
  • Retention, Revealed investigated the current state of app retention, and explored what mobile teams can do to improve their numbers.

From these reports, there were four key findings.

Finding 1: 63% of Marketers Send Push Notifications at the Wrong Time

In our first data science report last year, we analyzed the impact of 673 million push notifications sent around the world on app engagement and the results were very surprising. We found that 63 percent of marketers send push notifications at the wrong time. Here’s the region-by-region breakdown of user engagement during the weekdays.

North America

On weekdays in the late afternoon, engagement begins to peak. Most messages are opened by 7pm, when people transition from work to home. When the 8pm drop-off in sends occurs, apps actually have the least competition, and therefore the highest chance of grabbing user attention. Our theory: users are relaxing at night, unhindered by work or chores.

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Europe, the Middle East & Africa

Here we see the complete opposite of North America. On weekdays, users are much more likely to open push notifications in the morning hours, particularly from 6am to 8am. However, a look at the late night hours, between midnight and 1am, reveals an alarming discrepancy. Sends peak, yet users aren’t engaging. One possibility is that marketers in other geolocations fail to take into account individual time zones and send every notification at once.

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Latin America

On weekdays, opens peak at 8am during commuting hours and then drop during work hours. Opens dramatically increase at 5pm when users clock out of work — at the time we have dubbed, “push notification happy hour”!

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Asia-Pacific

On weekdays, there’s an appetite for morning pushes. Starting at 7am, consumers are more engaged than apps anticipate, but as opens rise throughout the morning, so do sends. By 10am, apps actually flood users with messages.

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Finding 2: There’s a Race for Engagement on Android Versus iOS

In addition to geographies, we studied how users interact with push notifications across mobile platforms. We found that the push notification open rate is twice as high on Android versus iOS.

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We believe that the platform design influences the way users engage with push notifications. On Android, messages “stick” around longer in the lock screen. Even after users view notifications, Android still lets them know they have unread notifications by adding a sticky icon to the top left corner of the home screen. A user is required to acknowledge the notification in some form, whether opening or dismissing, for it to disappear.

Conversely on iOS, once a user unlocks their screen to take any action, the message moves straight to the notification tray. It is then only accessible if a user drags the tray down from the top bar.

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Now, let’s examine the time to open duration for Android versus iOS.

Android, which has twice the open rates, sees a much slower time to open. The median time Android users take to open a push notification hovers around 48 minutes. By comparison, iOS users are much faster, opening push notifications within 7 minutes. Our hypothesis is that the difference is also related to the distinct user experience between iOS and Android.

Since iOS pushes disappear after a user unlocks their screen, open rates are lower. Yet iOS users who open, do so faster than those on Android. As notifications disappear after a user unlocks their iPhone, users open push directly from the lock screen. Perhaps iOS users are trained to act with more immediacy, knowing how quickly pushes will be moved into the hard-to-find notifications tray.

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Finding 3: Personalized Push Content Dramatically Increases Engagement

Mobile teams can personalize push notifications in several ways. They can factor in small details, such as the receiver’s first name. Or dive deeper to include an event parameter, action item, language, lifecycle, real-time location, and more. When mobile teams engage users with personalized content, they initiate a one-to-one conversation, rather than engaging users with a one sided generic blast.

The most successful marketing strategies recognize user behavior, provide value, and in turn ask users to take action inside the app. For example, a push notification could be as specific as, “Hey [Tina], you left an [African Block Print Skirt] in your cart. Only [two] left in stock. Come back and check out.”

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The personalization opportunities are vast and the research shows it’s very effective. On average, 1.5 percent of people open a push notification sent with generic content. Conversely, 5.9 percent of people open a push notification that contains personalized content — anything from a name to an event parameter. That means personalizing the content in your push notifications can result in a 4x increase in open rates.

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Finding 4: Apps Lose the Majority of Users on Day One — But There Is a Solution

Most apps go dormant after users open them. By day one, apps only have a 21 percent retention rate. By day 10, this number reduces to 7.5 percent. By day 90, the number drops to 1.7 percent. And no matter how we sliced the numbers (by vertical, platform, etc.), the average retention rate hovered under five percent.

However, the day 10 through 30 retention rates are relatively consistent. By focusing on improving the day 10 numbers, you can positively impact the retention of a user throughout their first month. And since the majority of abandonment has already occurred within the first month, you may be able to increase retention for all your users in the long-term.

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So what is the best strategy to retain users until day 10?

After looking at retention trends in hundreds of mobile apps, we found that push notifications can increase user retention by 20 percent. What does this mean in real-life examples? We hypothesized that if Pokémon GO sent push notifications, it could retain an extra 1,210,500 potential players by day 15.

By including push notifications in your mobile marketing, you can impact how users interact with your app over the course of their lifetime. You increase retention and increase ROI.

It gets even better. If you personalize push notification send times, you can increase retention by 7x.

To see how this would impact a real app, we analysed Target’s Cartwheel app. If Target personalized push notification send times as part of its messaging strategy, it would have the potential to retain 1.74MM more users and earn an extra $209MM in revenue over the app’s lifetime. This is a substantial gain for such an easy tactic.

It’s clear that personalization is a key element to driving higher engagement with app users, but there are many factors to consider, including platform, content, and delivery type. A/B testing to experiment with the right combination of message and content will ensure greater app engagement and ROI.

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Smart Apps: What’s Coming in 2017 and Beyond

We learned a lot about the app market from analyzing millions of data points and we predict that big advancements will be made in 2017. While technological developments in 2016 empowered mobile marketers to engage and retain users in new ways, apps are are about to become even more sophisticated.

Powerful new technologies such as machine learning, predictive analytics, and intelligent automation will dramatically change the way users interact with apps, while opening up a myriad of new ways for mobile marketers to reach their customers. With the power of data at their fingertips, we can’t wait to see what these apps accomplish.

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