iOS and Android Smartphones as well as tablets represent the technology which was adapted to the fastest in history. The app markets explode and implode and even Facebook calls itself a mobile company.
There are currently 1,061,228 apps in the app store and 50,000,000 apps get downloaded daily. This seems tempting for every app developer – however when it comes to monetise an app is equally important to know how the app is used (app engagement) and how often it is used (app loyalty), if ever.
Differences in the app categories
The following can be related to a report by Flurry.
Depending on the categories the engagement and loyalty rates can vary. Often users download and install apps once and never use them again, especially when it comes to free apps. An example of an app that has expired could be a game that was played in its entirety which obviously diminishes the appeal of the app for the user quite a bit. On the other hand and scale of loyalty and engagement could be a productivity app used for certain purposes every day. To know the characteristics of the targeted audience and match them to the app is essential to develop and monetize an app.
App categories usage matrixx
The graphic below show how often categories of apps are used in average (app engagement) and how often they are re-used (app loyalty).
The first quadrant represents the cash cows since they used the most frequently and with the highest retention over 90 days. These apps are considered as high value and since their audience is stable and growing they can be perfectly utilized for advertising or subscriptions.
In quadrant 2 live apps are seen as useful however only at certain times. Music streaming and dating can be seen as typical. The dating apps are a good example of how important it is to target the download audience when it comes to app marketing. The users are only a certain amount of time in the market, so to find and approach them on time is crucial.
The apps of the third quadrant are rather rarely used and retention is low as well. An example would be the singular use of an Android home screen personalization tool. The need to use it is gone. Monetization and app promotion would be achieved by providing them as a paid app, where users have to pay to get the functionality.
Quadrant IV consists of app which are infrequently used but have a high value. Travel apps which are used only a couple of times per year fall into that category.
Retention rate of apps
The retention rates of all apps have increased since 2009 from 25% to 35% whereas the engagement rate decreased from 6.7 to 3.7. Competition and better quality of the apps are the drivers of that development. There is just too many apps fight for the attention of the users.
In any case, the engagement and the retention rate are the KPIs the developers nowadays have to care about. They need to be incorporated into the app planning process as well as utilized for app marketing.