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Why Is Your User Retention Rate So Low?

For any mobile app, the rise and fall in user retention rates are crucial. Considering the growing competition, a low retention rate is an arising problem for every mobile app owner.

The average app loses 77% of its DAUs within the first 3 days after the install. Within 30 days, it’s lost 90% of DAUs. Within 90 days, it’s over 95%. Based on this Quettra data, Andrew Chen, General Partner at a16z, states that the average app mostly loses its entire userbase within a few months. 

If you are too one of those scratching their heads to discover the reason behind the low retention rates, then the following article is all you need to read.

App Retention Rates by Category

Undoubtedly, all the applications cannot retain users to the same degree. There are tens of thousands of applications belonging to various categories. The percentage varies from category to category. The Statista Research Department, after thorough research, has offered mobile app retention rate statistics to show 30-day retention based on categories.

According to the statistics report, the categories and their retention rate can be seen as following:

The highest day-1 retention rate is secured by comics with an overwhelming mobile app retention rate of 33.8 percent, followed by shopping (33.7%), news (33.1%), and gaming (32.3%, 32.1%, and 31% for different game categories).

However, when it comes to day-7 retention rates, the news application makes the position at the top even after a week with a 19.8 percent retention rate. Similarly, the next in the row are traditional banking apps with 18.6 percent. And the third top retention rate is of the comic category having 16.4 percent user retention.

The last statistics were recorded after a month, and on the scale, the highest app user retention rate is of traditional banking apps, with an impressive rate of 13.4 percent. Nonetheless, the next two top high retaining apps are news applications (13.4%) and digital banking apps (10.2%).

What Is a Good Retention Rate?

As clear from the statistics above, there can never be a defined good retention rate that is a one-fit-for-all the apps. When it comes to retention rate benchmarks, the fluctuation in rates depends majorly on the application category. However, other deciding factors include the user base, parameters, and the model of the business. Mobile app retention benchmarks can either be checked against your competitors or your firm. There will be times when your application faces low retention rates and times when your user retention rate is unmatched.

Commonly, most industries’ retention rate lies somewhere between 10 to 20 percent in the eighth week. However, the ideal rate might vary depending upon your industry. For instance, for the finance category, the rate would be excellent if it is near 25 percent, whereas for an e-commerce business, it would be less. All in all, it varies.

The Reasons for Having a Low User Retention Rate on Your App:

low-user-retention-rate

Factually, users try different apps and pick the one that serves their needs. According to Ankit Jain, the former Director of Engineering at Google and the current CEO at Infinitus Systems, the user decides the apps to get rid of within three to seven days. So to find out how to enhance mobile user retention, you will need to know the reasons that are holding your application back from gaining a special retention rate. Following are the most common reasons that are pushing you far away from improved user retention:

1) You can't acquire the right and relevant users in the first place:

Surely, user acquisition is not a piece of cake. Thereby, it requires great insight, in-depth knowledge, the right market research, and optimum strategies. Investing an advertising budget in convincing people who will not find any value in your app to install it is no good for a general marketing strategy. 

To know who to acquire, you need to have a vivid idea about your target audience. For this, the best way is to understand the significant characteristics of your ideal audience and then see how your app fits in their lives. The next step should be identifying the most useful ad networks that can help you reach out to the right audience.

2) You fail to deliver an engaging experience:

engaging-app-experience-feedback

Every user looks for a worthwhile engaging experience on the application they download. More engagement means more chances to explore your clients’ needs, expectations, and wants, leading to enhanced profitability. If you wish to improve user retention or strengthen user engagement through different strategies, read all about the subject on our App Engagement Guide.

3) Your app has technical problems:

Your users are likely to turn down your app if it comes with a few or lots of technical errors. From crashes to bugs and broken links, any technical problem arising in your app will push you away from gaining a good retention rate for the app. Therefore, offer an experience that is worth your users while and is running perfectly.

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Image: Innv8tiv

4) You have a difficult and exhausting onboarding experience:

The first real-time experience that any user will have after downloading your app is the onboarding process. Can you imagine what happens if that is a mess? Your users would already presume the rest of the app to be difficult if they decided to proceed further. Hence, make the onboarding simple, easy, and quick to enhance the average user retention rate for apps.

5) Your app is slow:

Any step in your app that makes your user wait is a bad sign for your retention rate. Your user has picked your app for a quick and easily accessible solution. So work on the errors that make your app sloppy to avoid facing a low retention rate, meaning decreased user retention due to your slow app.

6) It is overwhelming for users to navigate through your app:

Picking a user interface that confuses your user through the navigation is a bad idea. If a user navigates on your app for the first time, they should not spend a while understanding your interface. It should be this simple and quick.

7) Your app interrupts the experience too frequently with ads:

Ads for your business are undoubtedly a source of income. However, for your users, they are nothing but a mere disturbance most of the time. Ads appearing every minute by causing an interruption in the journey might be annoying. Thereby, for a smooth user experience, think about more creative methods to show ads. In-app stories can be great to this end since they are rewarding instead of intrusive.

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Image by Storyly, in-app story ads example

8) Your app sends too many notifications and messages:

Notifications and messages are a direct way to reach out to your users, but they can become a source of falling retention rates if sent too frequently. Users are likely to turn off your app’s notifications or even uninstall it, so beware and tailor them accordingly.

Next Step:

Overall, user retention is a skill that not every mobile app owner is a master of. Hopefully, the above article has provided enough information on the reasons behind the low retention rate. Now that you know the reasons, you should look for ways to solve them. To find some of the best strategies to retain your users, read Storyly’s article “7 Mobile App Retention Strategies: From UX to User Engagement”.

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