86% of users quit shopping apps after four weeks, study finds

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A new benchmarking study that has analysed 3.1 billion data points across 18 million devices and 15 million unique users has found that users download apps with alacrity, but 86% of consumers stop using them within four weeks.

The report from CleverTap –  the Industry Benchmarks for Ecommerce Apps– provides insights on how users flow from one lifecycle stage to another and provides recommendations to increase repeat purchase rate and hence user retention.

It has found that only 16% of new users complete the signup process within a week of installing the app, just 11.6% of new users remain active in the first week and 42% of new users uninstall the app within the 30 days of app install. Only 5.21% of users reinstall within 30 days of app uninstall.

For ecommerce brands, high customer acquisition costs (CACs) and price-sensitive buyers impact the overall customer lifetime value and profitability due to low retention, says the report.  With low entry and exit barriers, customers have a plethora of options to choose from even within niche categories.

Almitra Karnik, Head of Marketing at CleverTap explains:, “The cut-throat competition in the ecommerce industry makes it crucial for brands to deliver a superior customer experience. Our research indicates that ecommerce brands are losing customers faster than acquiring them. On average, shopping apps lose 86% of users within the first 4 weeks of download. “

She adds: “Without focusing on retention, brands are trying to fill a leaky bucket, focusing on acquiring more users that don’t stick around for long. This impacts the top line as well as customer lifetime value for these brands.”

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