02 Mar Most app users churn within 3 months—here’s how to avoid becoming a statistic
Imagine there are two shoppers using your baby apparel app. The first is a one-time visitor who buys a $500 gift for a baby shower. The second is a new mom who spends $100 each month on purchases for her baby. If you just looked at revenue, the first customer would appear to be worth more. But if you think about these people in terms of customer lifetime value (CLV), the relationship with the new mom could be worth more over time. A lot more.
Also, consider this: 80% of all app users churn within three months. With numbers that high, the odds of becoming a statistic are more likely than not. Employing CLV metrics can help stem the tide.
CLV measures the value a person brings to a business across all of her interactions over time—not just a single transaction. A focus on increasing CLV is crucial for marketing apps because it’s a surefire way to draw more of the customers you care about and drive ongoing engagement with them. Leading marketers—those who increased their business results by 10% or more last year—are 1.5X as likely as the mainstream to use CLV to measure how effective their marketing is.1