Smart app developers and marketers know that user retention is the only way to sustainably grow in a competitive market. In fact, it has been proven that retaining a mere 5% of your users can lead to boosting your business growth by a whopping 30% or more. In this article, we’re going to share how the top grossing apps are making use of push notifications for user retention. But apart from just examples, we’ll also share how to make notifications more effective with app inbox and what best practices to follow for maximum engagement on your notifications.

What are push notifications?

Push notifications are your direct line to your user. Similar to SMS, these media-rich notifications are sent from applications to users who have opted-in.

Categories of push notifications:

• Informational: provides useful facts e.g. sports scores, traffic conditions, etc.
• Transactional: updates users on actions they’ve already taken e.g. payments cleared, cart abandoned
• System: notifications from the app regarding new features, offers or sales
• User: notify the user of in-app messages or badge count

Unfortunately, opt-in rates for iOS are only 49.3% as opposed to 91% for Android. This contrast is due to IOS’s active permissions policy which requires users to explicitly consent to push notifications. Careful attention must be given to onboarding optimisation to ensure opt-in permission is given by the users.

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The importance of push notifications

There are literally thousands of apps that are being submitted to the app stores every day. This has not just increased the choices a user has when it comes to using an app, it has also resulted in most of them suffering from very high churn rates. According to a study by Localytics, most apps lose almost 71% of their users by the third month from the point of acquisition.

The user retention and churn status across all industries remain pretty much the same. Irrespective of the industry your app falls under, you’re losing most of your users within days if not weeks. For instance, even something as ‘interesting’ as games, are able to retain only 11% of their players by the third month. 

The reason being, that a great app or an interesting game is just not enough to keep the user hooked. If you want them coming back to your app or make it their go-to during break time, you need to remind them of what it does and how they were loving it in the last session they had.

 

Challenges

It’s easy to assume that user acquisition is the central metric for determining mobile app success, but without active users, high download rates won’t yield any business value. Brands are spending an enormous amount of money acquiring users; however, it only begins here. After acquiring users, the value is in engaging and retaining them. 

Mobile app engagement and mobile app retention are two metrics that provide genuine insight into the success of an application. Low app engagement and retention are a recipe for failure, while high engagement and retention equal the opposite.

Engagement -- describes how active users are on the application.

Retention -- while again a somewhat subjective term, the industry benchmark is the percentage of an app’s users who return to the app within three months of their first session.

Retaining users

Push notifications are one of the best app marketing strategies for boosting user engagement and retention. All you need is to create a strategy that keeps the user in mind and is implemented right from the day of acquisition.

Simply put, push notifications serve as a 1:1 communication channel between an app developer or marketer, and a user. And in times when a user is to be made to feel valued, this communication is exactly what you need to hold them back from venturing out to try other apps or games.

Improve retention rates

Mobile app marketers focused on attracting as many new users to the app as possible, touting number of users as the strongest pillar of success. However, what people didn’t take into account is the fickleness of these users with 21% of users only using an app once. It’s now apparent that as a mobile app marketer, you must move beyond just measuring app installs and instead focus on in-app behavior to promote engagement and user retention.

Solution

Achieving sufficient mobile app engagement and user retention rates is a difficult task. Statista reports that only 32 percent of users will return to an app 11 times or more after downloading it. What’s even more eye-opening is that 25 percent of users abandon an app just after one use. The reality is, mobile app developers are up against a competitive market in which users have a lot of choices. 

reports that users who experience some degree of personalized brand interaction are more likely to return to an app for 11 or more sessions. To put it in perspective, if you enter a physical store and aren’t acknowledged, you’d probably be disappointed with the customer service. Consider app interaction in the same light. 

An interaction can be as simple as sending a push notification welcoming users or providing useful information as users progress through the app. Successful apps use this type of interaction to shape the customer journey, by being thoughtful and strategic in how they reach out to users. For example, providing relevant retailer deals based on location and usage patterns is an effective tactic for prompting app sessions. 

Interacting with users is also a great way to re-engage users who have dropped out of the conversion funnel. The same report further supports this by stating that app abandonment after one use drops to 19 percent from 25 percent when this type of interaction is implemented.

The more aligned your app experience is with a user’s needs and preferences, the more likely a user is to continue using the product. Brands using in-app messages to communicate with users will see user retention within 28 days of receiving a message range from 61 percent to 74 percent.

In-app messages are notifications that don’t require immediate action but are nonetheless, important notifications to receive. These can include warnings about app issues, payment failures, or version upgrades. Keep in mind that not every message you send will be relevant to every single user. Segmenting your audience gives you the ability to ensure the information they receive is valuable to them. 

To achieve this, some apps leverage device capabilities such as location to target specific users with tailored messages including real-time updates and links to personalized content.

Result: Higher app retention rate

There are many of factors that affect app retention, but for most companies, it comes down to whether users find value in the product. To improve retention, product teams must try to understand where users find value in their product and deliver more of those experiences. 

Consumer apps face typically suffer from high user loss, known as customer churn, because consumers have so many alternatives. Unlike with B2B apps, where users are typically locked-in for a subscription period, consumer app users can churn with little provocation. Successful companies combat churn by tracking metrics and analyzing customer research. 

They conduct user interviews, studies, and tests to make the user journey smoother, and they use app analytics to measure a wide variety of metrics such as LTV, daily active users (DAU), average revenue per user (ARPU), and more that ensure that they are delivering value.