Using UX & Analytics to Increase Customer Retention and Conversion Rate

customer retention

In today’s digital world, mobile phones are concurrent to human existence. Business via mobile is the present day muse for the E-commerce industry. Particularly in a mobile-first economy like India where, as per the ‘Internet and Mobile Association of India’, 213MN out of the total 354MN local internet users are mobile-only. Mobile apps pose an expansive business potential that the digital startups of today can exploit. However, even with the growing internet skyline and boosting business facets, the business via mobile section faces the monumental challenge of app user retention. Basically, the challenge of converting a one-time visitor into an active & avid user of the app. While until last year, the industry was focused at burning cash on securing a significant number of mobile app users, the present day scenario has got them to focus on better mobile app engagement and retention.

Typically, a user with more than 10 sessions each month would fall into the category of an active user. Mobile App Retention, on the other hand, is a broader term comprising the percentage of users that have returned to the app within three months of their first session. Together, these two metrics have come to define the success or the failure of an app, influencing the conversion rate of the app. A conversion typically happens when a user ends up performing an intended action. The desired effect, however, may vary as per the key function of the app, such as buying a product, subscribing to the channel, booking a flight, commenting, etc. With one in four users abandoning an app after only a one-time use, we stand amidst some serious mobile engagement crisis.

Analyze Key Performance Indicators

The industry today is challenged with the dropping conversion, engagement and retention rates. In order to tackle the growing epidemic for mobile app players, certain serious overhauls are warranted. To intensify app conversion % and user retention % in the longer run, the mobile players need to delve deeper, by looking into each of the problem areas, alongside data analysis, and understand the fundamental cause of the issue. The process involves identifying 3 Key sectors and defining the corresponding performance indicators, namely:

  • Key Performance Indicator (KPI) for user activation – Sign up rate, 1 Day retention rate
  • KPI for retention – Daily retention rate, weekly retention rate and monthly retention rate
  • KPI for conversion – monthly conversion percentage

Though identifying these areas solves 50% of the problem at hand, the rest 50% can be tackled with a smart, analytical approach. Through an in-depth cohort and funnel analysis of each KPI, mobile app players can find a leverage point. The analysis may be well supported by conducting user interviews, in order to understand what the bottleneck is and eventually, find a solution.

Strengthen On Boarding User Experience Design

Just like the first impression, a smooth and effortless on boarding user experience is vital to the success of an app. In essence, for improving user activation and retention, it is important to let the user explore the home page of the app. If the initial on boarding design is making it too difficult for the users to experience the app, perhaps due to soliciting chunks of personal information, or technical glitches in the sign-up page, the users are going to abandon the app. Therefore, providing a smooth on boarding experience, through modern User Experience Designs, is the key to reducing mobile-app abandonment. In certain cases, efficient and effortless on boarding has proved to increase user activity and retention by 500%.

In a nutshell, for providing a smoother on boarding experience to users, mobile app players should:

  • Simplify logins and account creation – The same can be achieved by limiting the number of steps in the signup process, while also providing multiple options to users for the signup. Making sign up mandatory only at the time of placing orders is a simple way to engagement
  • Less is more– The app should be able to grab users’ attention in a short span of time by modernizing the interface and showcasing features vital at the time. This requires analyzing the segments that achieved the maximum user activity and  engagement
  • Tour De App– Offer a tour of the app to showcase the most innovative aspects of the app, engage with the users and render best app experience

Smoother on boarding lays the foundation upon which brands can build superior engagement, retention and conversion rates. However, app players need to understand that apps tend to get repetitive after a particular point of time. Thus, in order to enjoy higher retention, they have to provide timely impetus to the users. Feature updates, personalization, gamification are some of the tools which can be used to keep the users hooked to the app or influence them to at least come back. A thorough study of user behavior and customer feedback are vital to identify the road to success. Push notification also plays a significant role in reminding users about the app, while also notifying them about the latest feature update and available offers. Collectively, an extensive analysis of meaningful patterns and a leading edge user experience are the most contemporary weapons available for the mobile app players to stand ahead in a long line of companies selling apps.

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