A new way to measure app engagement and loyalty
App engagement is the new mobile battlefield. Users have, quite literally, millions of apps to choose from and limited attention spans. We know that 22% of people only ever open an app once and that the longer the interval between app launches increases the likelihood of losing a user forever. Bottom line: retaining app users is mission-critical, especially when conversions and monetization are your business goals.
What's the secret to app user retention? We call it App Stickiness.
So what makes an app "sticky"? For some apps, it's all about the UX. For others, the app fulfills a very specific and needed function. Or maybe it’s just fun and entertaining. But there are two key ingredients that are common to all successful, sticky apps: 1) power users: people who use an app repeatedly and 2) loyal users: people who return to the app even after some time has passed.
With this in mind, today we introduce the Localytics App Stickiness Index, which measures how well apps are tackling the challenges of engagement and avoiding churn, in aggregate. The App Stickiness Index is a composite of two key app metrics: power users and loyal users:
Key Terms
- Power users: % of an app's users who have 10+ sessions in a month, i.e. how many highly engaged users an app has.
- Loyal users: % of an app's users who return to the app within 3 months of their first session, which is the industry benchmark to measure loyalty and churn.
- App Stickiness: Average of an app's power users and loyal users.
By taking into account both user engagement and user loyalty "App Stickiness" provides a single metric that is applicable to all apps. You can use the Index to benchmark your own app’s stickiness over time and across platforms and verticals. By understanding the context and triggers that influence app engagement and loyalty in aggregate, you can then analyze your own user insights in order to adapt and refine your app engagement strategies.
The following charts and analysis illustrate the fluctuations in the stickiness of more than 25,000 apps from December 2011 through to March 2014. Moving forward, we’ll be publishing the App Stickiness Index on a quarterly basis.
App Stickiness in Q1 2014:
Q4 2013 and Q1 2014 were volatile quarters, in opposing directions. In Q4, against the backdrop of the launches of the iPhone 5s/c and the new iPad, power users were at an all-time high, peaking at 30%. Then during January 2014, the percentage of loyal users plummeted sharply, dropping to 16% indicating that apps were struggling to engage and retain users. This drop was likely due to a combination of traditionally low marketing spend in January, the reduced need for certain apps post the holiday season and overall reduced content consumption in January as people get back to work and try to find other uses of their time than from addictive app experiences. By the end of the first quarter, however, all three metrics had evened out. For March, the apps in the Index enjoyed 25% of power users, 19% of loyal users and an aggregate App Stickiness value of 22%
Localytics App Stickiness IndexDecember 2011 - March 2014
- Power users
- Loyal users
- App Stickiness
App Stickiness: A Vertical View
Analyzing apps through industry-specific filters highlights patterns and idiosyncrasies worth noting when it comes to applying App Stickiness best practices. We segmented the 25,000 apps we analyzed into five vertical groups and tracked their stickiness over time, identifying distinct trends across the verticals. For example, apps in the Games vertical consistently lag behind other verticals for loyal users (three-month retention) but don’t exhibit a marked difference in power users. The likely explanation is that most games, once beaten, give little reason for the user to return back to the game. A user will likely download the game, play it frequently until it is beaten, and then "burn-out" of it and not use it again. Very few games gives users a reason to return to them once they are beaten. A Games app that is able to retain users, as well as maintain the strong power percentage exhibited by most games app, will dominate the Games vertical. Whether your goal is to drive multiple app launches in a short time frame or retain more users over a long period of time, understanding your app’s stickiness will help you adapt your app marketing strategy accordingly.
When comparing Q1 2014 to Q4 2013, we noted that the Travel & Lifestyle vertical increased App Stickiness by 1%, while all the other verticals decreased their App Stickiness, particularly the Media & Entertainment and Technology verticals which experienced a 4% and 7% decline respectively.
| Vertical | Q1 App Stickiness | Q4 % change |
|---|---|---|
| eCommerce & Retail | 20% | -1% |
| Games | 18% | -1% |
| Media & Entertainment | 25% | -4% |
| Technology | 16% | -7% |
| Travel & Lifestyle | 21% | 1% |
By the end of Q1, the Media & Entertainment vertical led App Stickiness with 25%, while the other verticals all came in either side of 20%.
Localytics App Stickiness Index by VerticalDecember 2011 - March 2014
- eCommerce & Retail
- Games
- Media & Entertainment
- Technology
- Travel & Lifestyle
The App Stickiness Outlook
Unlike 2012, when power and loyal usage tracked very closely, 2013 and Q1 2014 saw these two metrics starting to diverge quite considerably. Looking out to Q2, it will be interesting to see if App Stickiness starts to trend upwards. It will also be interesting to whether app developers will favor one metric (power or loyal users) over the other or try to improve both simultaneously. Either way, we believe that a rigorous, data-driven approach to app engagement and app marketing will help app owners increase their overall App Stickiness.
