Posted on May 25/05/18
What is User retention?
It refers to the activities that app marketers/ product owners do to reduce the number of users they lose each month, quarter and year.
Why should you care about user retention?
Research conducted by Fred Reichheld of Bain & Company (the inventor of the net promoter score) shows that increasing customer retention rates by 5% boost profits by 25% to 95%.
Losing customers is expensive.
It costs seven times higher to acquire a new customer than to retain one.
That is why customer retention is important for the growth of any business.
You will definitely lose some users no matter how perfect your app/service is. Your goal as a business owner or marketer is to reduce the number of users you lose to the lowest numbers as possible.
Imagine two companies in the same industry with the same business model and pricing:
One company retains 90% of its users.
The other retains 50% of its users.
Which business is likely to grow and be around in the long-term?
I’m sure you know the answer to that. It’s the first business, of course.
Some marketers focus too much on acquiring new customers that they forget about keeping current customers happy through delivering an excellent product and service.
If you treat existing customers right, they will spread the word about the business. It’s more than just treating them right. You should be willing to do more.
That’s how you turn them into loyal customers.
How do you retain users and keep them coming back to use your app?
In this article, I will be discussing 6 effective user retention techniques that can help app marketers and product owners.
#1 Make the experience for the users' count
Apps and services that use well-designed notification systems as a CRM tool are generally a sticker than a similar service that does not use mobile CRM through SMS or Push. If you’re designing a game – make a game that has a daily ( or whatever ) cadence of “check-in” at the core of its design.
If you’re making a service, imagine an ongoing ( and respectful! ) dialog with the customer from the beginning.
#2 Give your users a reason to return
The best way to keep retention is to create something people use almost every day, and when they do return, provide them with the fresh and pertinent information they’ll want to come back to.
To get there, you must track and test variations of that “fresh information” you provide so you can determine which pieces of data are most pertinent to your users. Only then will the growth hacking and retention tricks have an impact. Otherwise, you are working against your users, and the retention tricks you employ will feel like a slog.
#3 Provide immediate value to your users
Users will usually use an app once they have a problem they need to solve or an internal trigger — are they sad? bored? And when they have this internal trigger, they will look for a solution that will bring them immediate value. So you’ve got to understand why your users using your app and how you’re going to provide a solution that is simple to use.
Once your users realize that your product provides immediate value to their problem within seconds of using the app, they will come back the very next time their internal trigger goes off.
#4 Use humor to re-engage inactive users
Use humor to re-engage inactive users.
Every customer retained is equivalent to acquiring a new customer. After all, a high churn rate can completely mess up your business model. There are a lot of ways to increase retention – better onboarding, asking churned customers for feedback, more stable app etc. The one I’ll talk about is a low effort and high impact tool – Email.
#5 Provide relevant content to engage and retain the users
Content is king: feed your users new and relevant content to engage and retain them.
A beautiful and intuitive interface can delight your users when they first open your app. But what happens next? People may come for the design, but they stay for the content. In order to hold onto your precious users, you need to keep them engaged by feeding them new and relevant content.
A few tricks can ensure users get the right content:
Newsfeed: Within your app, create a ‘feed’ for users that features new content created by other users or by the app-editors
Email digest: Send a daily/weekly digest featuring new content teasers with links back to the app
Reminders: When a user interacts with content but doesn’t quite follow through, remind them a day or two later just in case they forgot.
#6 Surprise and delight your users
“Find that perfect moment to surprise and delight your users.”
If you want to design an amazing app, you need to get UX design right. If you want to get UX design right, you need to understand user behavior. If you want to understand user behavior, dig into user psychology and examine where behavior really comes from in the brain.
While every user is unique, we all share evolutionarily-ancient brain structures and reflexes in common. And understanding these will help you build insanely better apps.
If you can create a UX that surprises and delights your users at the perfect moment, they’ll come back more often and stay in your app longer. That little ???? doesn’t just make them feel great – it actively rewires parts of their brain to turn your app into a habit. This approach requires care and insight, but the returns on creating a habit-forming app can be huge!
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About the Author
Shiva, User Growth and Customer Success at Walinns. I write introspective things I hope people can relate to.