Churn: acting before it’s too late
Tactics for establishing clear churn predictors based on Google Play’s research
The audience for an app can be split into 3 basic groups: 1) the not engaged (attracted by the acquisition strategy), 2) the increasingly engaged (encouraged by the retention strategy), and 3) the decreasingly engaged (re-engaged by the churn strategy). Since they all involve different strategies, it makes sense to think of acquisition, retention and churn as entirely different areas — yet combatting churn is often overlooked, either seen as mitigated by increased acquisition, or solved by improving the retention of engaged users.
In a previous article, we discussed how developers can set up an effective retention strategy, one which aims to increase the likelihood of retaining engaged users (you can also check out the full report which delves into greater detail). But no matter how great your strategy and app are, some of your users are going to churn.
A churned user is associated with a loss for companies beyond the obvious loss of potential revenue. If a user churns early, the acquisition cost of that user is entirely lost, and even though it’s possible to re-engage a churned user, this may be more expensive and time-consuming than acquiring a new one.
As a result, rather than attempting to re-engage a user — which involves directly overcoming all the problems that caused them to churn in the first place — it is far better to see if anything can be done beforehand to prevent them leaving in the first place.
How can we act before it’s too late?
Establish clear churn predictors
Preventing churn means acting before it happens by creating a warning system that allows you to identify signals of churn and act early. Users do not disengage overnight — prior to churning, the way they engage with the app will start to change in identifiable and measurable ways. To identify these red flags, look at your own data and see what behaviors are exhibited by users who churn:
- Point of churn: examine how long users are typically dormant before churning. Look at your churned users and their past engagement data to identify any patterns relevant to your app.
- Changes in engagement patterns: engagement is likely to start to decrease in frequency and duration before churning. Other patterns that generally indicate churn are superficial engagement, shorter session times, avoiding core features or looking at ‘how to cancel’ pages.
- Rate of churn: it’s important to look at the rate at which engagement declines. Sudden drops in usage require speedy counter-action to the decline, whilst gradual declines can be tackled over a longer timeline.
Quickbooks uses detailed modelling to deconstruct the behaviors of their recently churned users. They create ‘user risk profiles’ that highlight which behaviors correlate with high likelihood of churn.
These consist of 200 to 300 discrete in-app behaviors, including lack of interaction with features, number of days dormant and failure to achieve the north star metric. To learn more about how to set one, check out this article.
Conducting these post-mortems allows Quickbooks to intervene immediately with custom nudges towards desirable behaviors, reducing the risk of churn.
Reinforce the value of your app
Once you’ve created churn predictors, you can identify at-risk users and help them reconnect with your app. The user needs to see the value of your app again. You can reinforce it through helpful reminders of the features they have already access to or driving excitement about upcoming launches.
One of the ways of doing this is by reminding the users what they have already achieved with the help of your app. Yazio continually ensures users’ progress is visibly tracked and celebrated at all times as a measure to prevent churn. They leverage progress bars and celebration screens to motivate users to keep going to reach their goals.
Be sure to personalize content as much as possible to make the user feel valued. Mobills sends tailored messages to users who dip in engagement, offering gifts and encouraging messages.
Lifesum sends tailored messaging as well. However, they highlight what the user might miss out on. They focus on reminders of key features and highlighting less-well-known features that might entice the user to keep on engaging.
Keep an eye on expiring subscriptions
If your app runs a subscription model, the renewal window is always a potential risk. The most important thing here is to act based on the right signals at the right time. To do so, identify behaviors that indicate churn in the weeks or months leading up to the end of the subscription and at what time are they happening. You may find signals earlier than you expected.
Beyond that, ensure you are offering other options beyond cancellation and communicate them clearly to the users. They may simply not know that more affordable, low touch or ad-based options exist. Don’t give them a reason to cancel!
When communicating offers, consider value reframing. Renewal can be a tricky topic. You might need to test different messaging to find what resonates with your users. A straightforward message about the costs, benefits and options may allow the user to feel empowered. Comparing the cost to real-world equivalents can offer some perspective — Yazio shows that the monthly cost of their subscription is less than a daily cup of coffee and less expensive than some diet products.
Also remember that personalized messaging makes the user feel valued. During the cancelation flow, Quickbooks showcases what the user has achieved via the app (e.g tracked 1,000 miles), and highlights features they have been paying for but have not used yet.
To sum up
Throughout the steps above, you might discover different patterns of behavior which lead to churn, representing distinct user groups and their barriers. For some of those groups, churn may be unavoidable. They may represent users who misunderstood the value proposition of your app or have just outgrown it. Focus on those user groups that will bring you value rather than those who you can identify as having low levels of activity despite a number of efforts to re-engage. Remember, it’s impossible to completely eradicate churn.
Hopefully this article will help you set up your churn minimizing strategy. The tactics above are useful tools in keeping these “on-the-fence” users engaged — an essential part of sustainable growth for your app — alongside your acquisition and retention strategy. For more information on these topics, check out the resources below:
- Article on retention
- The full report, featuring many more case studies and insights on the topics of retention and churn.
What do you think?
Do you have thoughts on how to build an effective strategy to prevent churn? Let us know in the comments below or tweet using #AskPlayDev and we’ll reply from @GooglePlayDev, where we regularly share news and tips on how to be successful on Google Play.
