B2B apps, listen up: there’s a data-backed way to increase your user retention.
Acquisition is one of the most sought-after marketing goals, but there’s more to mobile marketing than growth. By day one, apps lose 77 percent of users; by day 90, retention dwindles to 1.89 percent. Without a solid retention strategy, your growth dollars are wasted.
In Leanplum’s latest data science report, Retention, Revealed: The Need-to-Know Facts Behind App Retention & ROI, we dug into the nitty-gritty of app retention. We analyzed retention’s relationship with factors like app platform, vertical, and user demographic. However, no matter how we sliced the numbers, the average retention rate remained the same: just under five percent.
Instead, we decided to study how retention is affected by one key action: push notifications. In our previous report, we learned that personalizing push leads to 9x more engagement. For this report, we wanted to understand if sending a push notification to a user specifically improves retention rate.
To analyze the impact of push on retention, we queried hundreds of apps that send push notifications and compared them to apps that do not.
The Effect of Push Notifications on Retention
Below, we can see that retention rates are higher for apps that adopt push messaging, versus apps that do not. In the first month, the average difference between retention is 1.5 percent — substantial, considering the average retention rate is 7.5 percent by day 30. That means that apps can increase retention by 20 percent simply by sending push notifications.
Average retention rates for apps that do not use push notifications:
- Day 1: 16.42 percent
- Day 15: 3.6 percent
- Day 30: 2.36 percent
Average retention rates for apps that do use push notification campaigns:
- Day 1: 20.11 percent
- Day 15: 4.71 percent
- Day 30: 3.33 percent
For a real world example of how the simple act of sending push notifications can affect an app’s revenue, let’s look at Pokémon GO.
The immensely popular game saw 75MM downloads in a number of days. We can pull from the day seven retention rate — 8.07 percent — and assume that Pokémon GO includes push notifications as part of their engagement strategy. As a result, Pokémon GO is capable of retaining an extra 1,210,500 players at day 15. Capturing these additional users by day 15 means you have a good opportunity to retain them for the remainder of their app lifetime.
Push isn’t just valuable for huge hits like Pokémon GO, either. Let’s apply the same calculation to a hypothetical app that hit 500,000 downloads after a week, with the same 8.07 retention rate. A 1.5 percent boost to users at the 15 day mark would still give the app over 7000 new users. Given that the average cost per install in the US is around $2, that’s a significant amount of acquisition money saved.
Adopting push notifications in your mobile marketing arsenal can impact how users interact with your app over the course of their lifetime. You increase retention and preserve your financial investment in app installs.
How Should B2B Apps Use Push Notifications to Improve Retention?
There are plenty of ways in which B2B mobile apps can use push notifications. For instance, let’s look at a pair of popular freemium B2B apps: Slack and Dropbox.
The free version of Slack currently doesn’t support guest access. If a guest clicks a link to join your Slack server but can’t get in, the app could send a push notification alerting you that guests are only allowed on paid accounts. This message combines a subtle upsell with a valuable alert, and it’s sent at a moment when its value proposition couldn’t be more clear.
Dropbox could set up a similar trigger for storage alerts. When a user exceeds the amount of storage allowed on the free plan, the app could send an alert with details on the next plan up. The message would alert the user that their file upload failed, and it would provide a clear solution to the problem.
One way or the other, sending push notifications clearly impacts your retention rates, and more retention means more revenue. Personalized or not, the simple act of sending push notifications will improve your retention rates by 20 percent.
But you can do even better. Want to learn how to increase your retention rates by 7x? Download our data science report to get all the need-to-know facts behind the best way to leverage push notifications for better retention.