At the risk of being a scosh repetitive on this blog…arguably the biggest trend in app marketing this year is the dramatic increase in mobile app remarketing spending versus just a year ago. We’re seeing this trend manifest itself across categories, regions and app revenue models. And the underlying cause is that app marketers are now strongly focused on cultivating quality users and enduring customer relationships. What we thought we’d do here is outline a series of data points for this trend so that if you researching this important topic you will have a lot of facts at your fingertips.
Low App Retention – The Industry’s Chronic Problem
Most people in the app industry know that retention is a challenge for app marketers. With relatively few exceptions, apps tend to lose the lion’s share of their users within the first 3 months of a customer engagement. In fact, a big chunk of that loss occurs in the first week. We examined our own data, and the figures posted by others, and determined that the average app loses about 83% in the first 7 days, 90% in the first 30 days, and 95% in the first 3 months. That’s counting a lost user as someone who fails to log in every day. Now, that’s a high bar for some categories. But even if your definition is a lot looser than daily usage, it’s plain that far too many users – the vast majority of users – fail to become regular users/customers.
Demand for Revenue – The Catalyst for Change
Rapid user loss has been a problem for the industry for years. So why are people getting so exorcised about it today? Well, the key reason is that marketer KPIs have changed dramatically. As recently as a year ago, most marketers were measured primarily by the number of installs they drove. Today, most are measured based on revenue. In a recent survey of mobile app marketers we conducted in association with our partner, Thomvest Ventures, more than 80% said they are measured primarily based on revenue rather than install figures. See the chart below:
All that focus on revenue means that marketers can’t look at installs in the same way as they did before. Almost 80% of the marketers surveyed told us that they care more about user quality than they did a year ago, and that user quality is measured primarily by long-term usage and revenue.
Another important data point underscoring this trend is that our customers are spending far more time in our platform than they did in the past, and are conducting much more retention, uninstall and revenue analysis. All of these are signals that the challenge facing app marketers has changed markedly.
The Money is Flowing
Both the amount of remarketing spend and its share of total app investment are growing rapidly. Across the Apsalar footprint, remarketing now accounts for about 14% of all paid events. This is up from about 4 percent at the close of 2015.
Most Popular Use Cases
Given all of this new expenditure, many marketers want to know which strategies are proving most effective. Our analysis indicates that the following six use cases are the most common for enterprise app publishers: