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Successful apps understand how vitally important customer retention is when it comes to growing a business. Good retention means product/market fit. It means greater customer lifetime value. It means higher average order value, increased revenue, and lower customer acquisition costs.
But the how of customer retention can be elusive.
What’s the best way to attract the right users to your app?
How do you perfect the first-time user experience to deliver the value they expect as soon as possible?
What can you do to keep customers engaged with your brand over time — beyond just sending discounts and freebies?
Sadly, there’s no silver bullet or magic incantation to keep customers engaged with your brand. But there is plenty to learn from experienced growth experts who have been there, done that.
We’re sharing advice from retention marketers who have faced these same challenges at hyper-growth brands like Facebook, Pinterest, and Duolingo and emerged victoriously. Use their sagacious words to inspire your own retention strategies.
Key Takeaway: Retention must be your top priority.
Why? Downloads don’t drive growth.
Good retention improves everything from revenue growth to acquisition campaign ROI.
As Balfour succinctly states, if you can’t hold onto your customers then your business is hemorrhaging cash. Focusing on acquisition is like slapping on a band-aid and wondering why you’re flattening.
Read the growth stories behind unicorn apps and it’s easy to feel like it’s a one-in-a-billion shot: the perfect product met an untapped, unlimited market to ignite a powder keg of growth.
But as Palihapitiya notes, improving retention is both an art and a science. And you need the mindset to match.
Approach your retention efforts with the scientific method: a thoughtful hypothesis, clear experiment parameters, a defined test audience, and data-driven conclusions.
Test and test and test some more — testing for retention is a process that never really ends. Learn just as much from “failed” experiments as the tests that successfully boost your retention rates.
Just remember: Palihapitiya says growth is simple — he doesn’t say that it’s easy.
Key Takeaway: Be persistent. Instead of designing experiments based on what you think will improve retention, let the data talk. Focus on the entire user journey, including acquisition and activation, not just the bottom of the conversion funnel.
Gotthilf’s anecdote is the perfect example of why an experimentation mindset is so critical. You simply can’t predict what’s going to move the needle — and sometimes it’s the minor tweaks that make the biggest difference.
So how do you know what to test?
One way to approach designing retention experiments is to examine your customer journey and brainstorm 2-3 ideas for each step. For example, how could you help first-time users finish the registration process? What are two new ways you could prompt inactive users to try a key feature?
Key Takeaway: Once you have a list of retention experiments, prioritize them and get started testing. As your experiments start to effectively improve engagement and retention, you can shift your focus to other parts of the customer journey to improve new user acquisition/activation and ramp up growth exponentially.
It’s easy to look at the neverending A/B tests and retention experiments and get overwhelmed by it all. But nearly every growth exec who’s built a successful app says the same thing: it doesn’t have to be so complicated.
Key Takeaway: Try things. Take notes. Dig into your data. Watch what happens and how your users react. Which leads us to our next point…
Do what works for you.
As Winters explains: “At every company I’ve worked for, the first experiment I tried was based on an idea that worked at the last company — and 100% of the time that experiment failed miserably. You can’t copy a growth strategy from one place and paste it on top of a totally different business. You won’t know what will work for your product until you start the most important loop of all: testing, failing, learning, and testing again.”
Your users are a goldmine of information. As Ellis says, no one understands the value of your app better, and they know the friction points that represent easy opportunities for improvement.
Key Takeaway: Your users will tell you the secrets to long-term retention for your app — but you have to ask!
Whether you send an email or launch a short in-app survey, gathering candid customer feedback is one of the best ways to gain a deeper understanding of both why and how people keep using your app. It’s one reason the most successful mobile brands are so customer-centric.
Data beats intuition every time.
As a mobile brand, you have access to a massive amount of user data via your mobile analytics — data that represents a priceless opportunity to understand who your most valuable customers are and how they use your app.
Key Takeaway: Dig into your data. Tools like user cohorts and RFM Analysis are easy ways to identify these high-value customers and attract more of them to your business.
Behavioral psychology can be a powerful advantage when it comes to improving your user experience — and not just for gaming apps. Tease new products or coming-soon content. Highlight the number or monetary value of loyalty points, or feature a countdown to redeeming a reward. Celebrate engagement milestones like membership anniversaries or track progress towards personal goals.
Key Takeaway: By building effective engagement hooks, you can guide new users into deeper engagement with your app, help them develop habits around it, and set them on the path to long-term retention.
Customer loyalty is something that’s earned by delivering value at every possible touchpoint. Every push notification, email, and in-app interaction should improve your user’s life — whether it’s helping them save money or simply making them smile.
Key Takeaway: When a user comes to your app looking for quick directions, instructions, information, or updates, it’s your job to provide the solution. It’s one reason why micro-moments are so important to the customer experience. After all, the best retention strategies aren’t about reminding users that you’re there at every opportunity. It’s about providing value when it matters so they remember you all on their own.
As one of the most famous advocates of a retention-first growth strategy says:
Key Takeaway: Improving retention isn’t a problem you can ever cross off as “solved.” It’s a continuous process — and it must be the guiding star for everything you do as a marketer.
When churn is high, the importance of retention is clear: you’re facing the obvious problem of stalled growth, low CLV, poor ROI, and faltering revenue. But when customer loyalty is high and your revenue growth is soaring, it’s easy to let your focus slip and let retention become an afterthought.
Fight that temptation.
As Dan Wolchonok advises, monitor retention cohorts to see where users are dropping off. Watch key metrics like monthly churn rates, track uninstalls, and examine your win-back campaigns. Keep retention at the forefront — even when things are going well — to keep growing sustainably.
Improving retention is the single most powerful driver of business growth. In fact, retention-first brands are 3X more likely to increase market share than those who prioritize acquisition.*
Earning customer loyalty means building meaningful connections with your users. By understanding what they want from your brand and meeting their needs with the right message on the right channel at the right moment.
Solutions like CleverTap allow marketers to identify and act on these in-the-moment opportunities with every customer, no matter the size of your audience. See how our analytics and engagement platform can unlock greater retention for your brand.
See how today’s top brands use CleverTap to drive long-term growth and retention