KEY POINTS

  • The pressure to market an app has never been higher as users focus their activity on just a few apps and user retention remains challenging. In June 2014, the average user spent about 70% of app time in their three most frequently used apps. About 52% of all apps lose at least half of their peak users after three months.
  • The cost of acquiring and retaining users is soaring. The iOS and Google Play app stores are overcrowded, and competition to stand out is at an all-time high. The cost-per-install on iOS soared 59% year over year in October, while the cost to retain a loyal user — defined as a user who opens the app at least three times in a two-week period — is even higher than acquiring a new one, and was up 33% year over year.
  • There are a few proven strategies that can help apps have their best shot at building a loyal user base.
    • Developers should focus on marketing their apps just ahead of major new phone or operating-system launches. App-marketing costs go up after a new device launches, because lots of apps are competing for the attention of consumers downloading apps to their new phones. Apps that are top of mind among users when they first get their phone are likely to have an advantage.
    • Android and the Google Play store offer app marketers an attractive deal in terms of the cost of user acquisition. The cost is about 25% less than it is on iOS. 
    • App-install ads have become a popular way to drive new downloads while other app-store optimization (ASO) tactics can help increase visibility through unpaid means. Picking a strong app name and keywords, including images in your app-store page, and using localization strategies are all important ways to get your app seen.
    • To retain users who already have an app, in-app messages and offers are a good strategy. For example, a gaming app might push a user a message offering them a one-time deal on extra lives so they will continue playing.
  • Successful app-marketing strategies run the gamut from offering push-messaging deals to getting press attention ahead of an app launch, using location-based targeting, and QR codes. We review a few case studies of app-marketing success. 

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