Generally speaking, customers are the fortitude of mobile app development. In the simplest sense, mobile apps would be unable to make revenue, profits, and therefore have no market value without customers!

Since customer retention has become a vital consideration for app developers seeking to maintain productive relationships with customers, smart customer retention strategies are no longer a trivial issue.

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What is Customer Retention?

Customer retention revolves around the prevention of customers from going to competitors. In practice, customer retention entails businesses focusing their efforts on existing customers in an effort to sustain business with them.

As such, customer retention strategies are actions businesses take to reduce the number of customer defections. Since the cost of acquiring customers is typically expensive, sustaining and keeping customers is an imperative and proactive effort that every mobile app owner should take.

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Principally, customer retention strategies revolve around increasing loyalty and retaining valuable customers, focusing on three crucial business attributes: increased revenue, lower customer acquisition costs, and increased referrals.

Why Employ Customer Retention Strategies?

For starters, it is more expensive to sell new features or in-app services to very new customers.  For the most part, loyal and retained customers usually don’t mind paying slightly higher prices and always look forward to discounts when compared to the new customers.

According to Market Metrics research, retained customers tend to believe that higher prices depict higher quality while expecting above-average customer service. Furthermore, past marketing researchers discovered a linear relationship between repeat purchases and customer satisfaction. For example, research from Harvard Business School demonstrated that improving customer retention rates by only 5% can escalate a company’s profit by 25-95%.

Customer retention is essential as acquiring new customers typically costs 5 to 25 times as much as retaining existing customers. Additionally, several studies have shown that repeat customers spend about 67% more than new customers. Research has also proven that customer profit rates tend to grow over the life of the retained customer.

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All things considered, customer retention strategies allow mobile app businesses to withstand intense market competition besides gaining significant savings from retaining existing customers. So, which effective customer retention strategies can be implemented through speed, performance, product quality, responsiveness, and availability?

Effective Customer Retention Strategies for Mobile Apps

1. Minimizing Customer Churn

Churn is principally the measure of the number of customers who stop utilizing a product, especially when a business is employing a subscription model. For example, customer churn can be represented as 5% of total customers lost over a 30-day period. Devising means of minimizing customer churn is a vital component for maximizing customer retention as customer churn comes in various forms.

It can occur due to poor onboarding experiences, unresponsive customer support, delinquent churn, or product issues. For example, delinquent churn arises due to failed rebills (expired credit cards, outdated billing details, etc.). To address such scenarios, developers are encouraged to invest in better technology that manages subscriptions efficiently.

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On the other hand, customer churn can be ordinarily handled via customer exit questionnaires to help you understand why churn is happening and how to prevent it in the future. In some instances, you can make an effort to personally reach out to your customers to find out reasons for their exit.

2. Improving Customer Experience

Customer experience is the fulcrum of any sustainable business. If users cannot access support when using your app, your business will eventually collapse. Especially if you have many competitors in the same app category.

That being said, finding a means of providing instantaneous responses to your customers is an effective retention strategy. Once you sort this out, you significantly reduce the number of customer touchpoints.

The aim of any app developer should be to provide superior customer service that ensures high levels of customer satisfaction. This can be achieved with the integration of a live chat function or help desk tool into your app. This way, you can easily transform a customer question into a sale, or customer complaint into resolution. As such,  turning an unhappy customer into a loyal, repeat customer.

3. Employ Regular Content Cycles

Content cycles go a long way in helping existing clients keep abreast with your mobile app and upcoming improvements or software updates. In essence, content helps keep them invested in your product, especially if you provide content they care about, whether educational, informative, or at least entertaining value.

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This content can be in the form of e-books, blogs, videos, social media posts, or even webinars. Also, not forgetting the time-tested channel of email marketing. Overall, the idea is to deliver a sense of exclusivity for existing customers that organically combine sales offers, app information, and promotions.

4. Utilize Loyalty Programs

You always have to find ways of creatively promoting a sense of loyalty amongst your customers. The idea is to always give customers a reason to ignore your competitors at all costs.

This can be achieved by delivering compounding benefits such as ongoing add-ons that make customers feel that your mobile app service is getting better consistently. Or even exclusive rewards for every successful referral, thus encouraging customers to stay committed to your app.

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Loyalty programs augment customer service and the revenue of the business, thus fostering long-term relationships. As a matter of fact, statistics show that 49% of consumers agree that they spent more after having joined a loyalty program.

5. Accept Customer Feedback & Act On It

Asking for feedback from your existing customers is one thing, however, accepting it and integrating it into your customer service is another challenge altogether. While it’s popular for entrepreneurs to seek feedback to identify the root causes of issues by sending regular surveys and questionnaires to customers that focus on their concerns, without the ability to assimilate feedback into their operations, many fail to increase their customer retention rates.

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Generally, the small facets or hidden dissatisfactions that existing customers relay are typically invisible doors towards making them your most loyal customers.

6. Exploit Data

Intelligently employing data analytics can help you determine when and how to measure customer churn from the get-go. Data helps you identify key performance indicators (KPIs) that provide actionable and pertinent guidelines to gauge the success of a retention strategy. As well as a means to discover potential areas for improvement.

Some KPIs that one can consider are:

Though KPIs tend to shift in relevance over time, it’s imperative to adopt frequent KPI re-examination to ensure that they are delivering what you exactly need to see.

Effective data exploitation also involves customer segmentation by behavior, demographics, and geographic areas. This can help you put existing customers at the forefront of all your business efforts, thus ensuring customer retention.  

7. Offer Customer Incentives

To maintain relevance with customers, ensure to give incentives based on each customer’s journey. These incentives can come in various shapes and forms, for instance, discounts, giveaways, exposures, etc. Incentives provide an added advantage of providing a great way for customers to interact with your product.

Remember, customer retention strategies focus on brand loyalty. And since brand loyalty is like keeping good friendship, trust, continued communication, and sometimes even freebies, keep the relationship going, or take it to the next level.

Incentives cannot be underestimated as today’s app marketplace has become more dynamic and competitive. This means that an ‘awesome’ product is not always sufficient to retain your existing customers. So, ensure to be creative with offers like ‘buy one get one free,’ free-in app purchases, gift vouchers (where applicable), discounts, and ‘free trials’ to maintain customer interest.  

8. Foster a Product-Centric Community

Creating a community for your app is another way to ensure customer retention. Whether a Facebook group or Reddit group, engaging with customers on social media helps them share their positive experiences with your app.

In essence, customers always want to belong, and by fostering a community around your app, you can create an online space for your customers to belong. Consequently, converting them into loyal brand advocates. 

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That being said, ensure to have some user-generated content on your social media channels or blog as you build your community on social media. For instance, Crowdfire maintained a unique public community on the now defunct Google+. With this community, Crowdfire allowed other users to collaborate and share insights, fostering a heightened level of engagement.

9. Encourage Testimonials

In a highly competitive app space where information can be gathered from all corners of the web, honesty remains the best policy. The value of offering customers transparency has been affirmed time and time again. For example, surveys have shown that presenting only positive reviews on an app’s site creates suspicion among readers, who typically conclude that the app is inauthentic.

For this reason, encouraging honest feedback and displaying it can help to retain customers. While this practice might seem intimidating, it provides a multitude of benefits, such as enhanced customer trust, social proof, or making existing customers feel more engaged with authentic experiences.

10. Utilize Automation to Re-Engage Existing Customers

Industry marketing automation tools have advanced significantly to save business owners time with faster customer response-time and easy monitoring. In practice, since you cannot remember everything when interacting with your customers, automation saves your customer data and improve customer service and product performance.

Automation can also help with your efforts to employ remarketing by keeping existing customers updated with new discounts, or other exciting news about your company.

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As the app market becomes more saturated with high levels of competition, customer retention strategies are becoming more pivotal for app developers aiming to move beyond satisfying both existing and new customers. In today’s dynamic environment, customers need motivation to continually repurchase in-app services or products. On the other hand, customer dissatisfaction remains a primary factor for customers to switch to competitors.

So, in summary, to maintain the loyalty of existing customers, utilize incentives, set up online communities, creatively change channels of distribution to focus on existing customers, and design special loyalty programs that attract and hold your most valuable customers.

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