For the last decade, the mobile industry has focused on user acquisition. As smartphone saturation rates grew, however, the focus of the industry is gradually shifting towards retention. With retention and long-term relationships critically dependent on user engagement , these trends will lead the mobile market into its next evolution phase:
1. Increased focus on user loyalty
TL;DR: the hyper-focus on acquiring users is over. Keeping users retained is becoming the most important KPI.
The spend on user acquisition (UA) has grown almost exponentially since smartphones emerged. D2C (direct-to-consumer) products and services have been highly invested in UA from the beginning. In the last few years, brands have significantly increased their footprint on mobile as well, contributing to mobile ad spend.
The mobile market has matured in the last couple of years. UA budgets are still increasing, but so is the competition and the cost of acquiring users. User LTV (Life-time Value), the main success KPI, depends highly on retention. Naturally, the longer a customer uses the app, the better the chances are of monetizing him or her. Furthermore, users who develop long-term relationships with services tend to spread the word and recommend the app, bringing more users and increasing value.
This realization is playing out in 2019, making performance marketers steer their focus away (although not completely) from driving more installs to invest more budgets and human resources on fixing the ever-challenging user retention rates.
2. The rise of mobile CRM
TL;DR: a very low percentage of apps have incorporated a CRM to effectively manage user relationships. 2019 will see an impressive increase in adopting a CRM platform on mobile.
When it comes to apps, the CRM space is still very much untapped. While many brands are already using Mobile Engagement Platforms, most mobile products are still unaware of the impact that effective communication has on customer engagement and revenue. Currently only 20% of the top 500 apps use mobile engagement platforms, in clear contrast to 95%(!) that use analytics SDKs.
Communication with mobile users take several forms – mainly email, push notifications, SMS, and in-app messaging. In 2019, growth teams (a trend of its own in the past two years) will invest more efforts in optimizing these communication channels. More top chart apps will use popular MEPs or their own dedicated, in-house tools to optimize mobile engagement and create meaningful relationship with their mobile users.
3. The move to one-to-one marketing (hyper-personalization)
TL;DR: apps will be able to achieve one-to-one communication with users, and adapt their services to each and every user and their real-world needs.
Although ‘Personalization’ has been a buzzword in the digital era for quite a while, personalization tools have popped up only in recent years. Personalization tools allow a product and its communication channels to adapt to the each user. 2019 will see services harness AI and machine learning to enable hyper-personalization:
In 2019, many mobile-first companies will be adopting hyper-personalization and integrating it into their communication platforms. With hyper-personalization, app marketers can find the right offer, match it to the right user, and deliver it at the right time. Reaching this level of personalization requires the collection and processing of real-world user data, as well as the infrastructure for granular segmentation. This investment dramatically (and positively) improves users’ engagement, retention, and LTV.
More focus on retention, the rise of CRMs, and the adoption of hyper-personalization tools are all part of a greater trend – transforming digital products into extensions of users’ offline, real-world lives. Breaking the barrier between the online and the offline and creating meaning relationships are not passing trends – they represent the present and the future of the app industry, for years to come.