Today we are launching a new edition of our annual app user retention study which looks at loyalty and abandonment across our user base.
Our study focuses on two key metrics:
- User Retention: The percentage of users who return to an app eleven or more times.
- User Abandonment: The percentage of users who abandon an app after one session.
This year, we were surprised to see a decline in user retention, dropping from 39% in 2014 to 34% in 2015. On the other end of the spectrum, we also saw a notable increase in user abandonment, jumping from 20% in 2014 to 25% in 2015. We dug in further to understand if the data was varying across a number of vectors, including operating systems or geographic locations, and were able to see a marked difference between the U.S. and the rest of the world, particularly in China.
U.S. User Retention Improves to 42%
As we look at results for the U.S., engagement actually improved year over year. The number of users who returned to an app eleven or more times this year increased by almost 3 percentage points to 42%. At the same time, user abandonment rates have held steady at 19%.
This can likely be attributed to continued improvements around app development, as well as better strategies to engage users with tools like push messaging and active efforts to re-engage lost users through email and remarketing.
Retention in China Proves to be More Challenging
Our data shows that users in China behave very differently across the same apps. Overall, retention of users based in China has historically been worse than that of U.S. based users. But, over the past year the data took a dramatic turn for the worse. User retention dropped from 27% to 18% of users returning to an app eleven or more times. Additionally, 37% of all users in China only used an app once.
So what happened in the past year that caused such a dramatic difference in China? There are several likely factors:
- The country’s economic conditions are driving the rapid adoption of smartphones and the improvement of 4G networks. According to a report from App Annie summarizing the first quarter of 2015, app downloads in the China surpassed that of the U.S. for the first time ever.
- The massive growth and proliferation of the free messaging app, WeChat, is impacting retention. With many brands choosing to use WeChat instead of developing their own native app and WeChat also extending into commerce services, the need for other apps is decreasing quickly.
- Chinese users spend less time in the same apps as U.S. users — only 4.1 minutes. Their expectations of what makes an app useful are dramatically different and may lead to more abandonment early on.
Additionally, abandonment rates in China are higher for older devices where storage becomes an issue:
Push Notifications Improve User Retention to 56%
On a more positive note, we found that apps that leverage push messaging have higher rates of user retention in both the U.S and China. Push messaging offers a transformative way to interact with users in real-time and helps to enhance the overall value of an app. Companies around the world are starting to leverage push messaging more effectively, helping to drive notable increases in retention.
More than 50% of all users in North America who opt in to receive push messages return to an app regularly, with over half of all users returning to apps eleven or more times.
In China, apps that leverage push messaging also have higher retention rates. App abandonment drops from down to only 20% of users who will return to an app once, and retention of users jumps up to 35%.
While it’s fair to think that users who are enabling push messages are more likely to be loyal just based on the fact that they enabled push, it’s a good sign that focusing on encouraging push notification opt-ins, combined with personalized push and acquisition techniques such as Facebook remarketing, will help marketers continue to improve user retention for their apps.
Overall, the news is good for marketers: the hard work and time spent optimizing their apps and personalizing their marketing through tools like push messaging is making an impact. Further focus on key tactics like the onboarding experience, optimizing for global audiences and encouraging push notification opt-in should continue to move the needle forward to a place where over half of all downloads become active users.