For marketers in the ecommerce space, clicks and conversions often come with a hefty price tag. High customer acquisition costs make it close to impossible to keep adding more users while growing your bottom line.
In short, without focusing on retaining current customers, ecommerce apps are trying to fill a leaky bucket by constantly acquiring users that don’t stick around.
On average, 80% of new shopping app users churn within 4 weeks of downloading the app.
To help ecommerce brands, our data science team did a deep dive into in-app user behavior, campaign engagement, and conversions to understand the key factors that contribute to growth and retention for ecommerce apps.
We analyzed 140+ million devices — over 121 million unique users across multiple ecommerce apps and geographies — and looked at 4.5B push notifications, 450M emails, and 99M in-app notifications.
Here’s what we learned:
Registration: Only 30% of new users complete the signup process within a week of installing the app.
Retention: Only 13% of new users remain active in the first week.
Uninstalls: 33% of new users uninstall the app within 30 days.
Reinstalls: Only 6% of users reinstall within 30 days of app uninstall.
The full benchmark report provides key insights into how users flow from one lifecycle stage to another and includes recommendations to increase repeat purchases and user retention.
User Retention Benchmarks for Ecommerce Apps
Since customer retention is a core challenge and an important metric for ecommerce businesses, we look at it from two lenses: app launch and transactions.
For a better understanding, we define users who performed the first app launch as new users and users who’ve transacted at least once in the previous month as existing users.
The chart below shows the retention rates that are calculated based on the cohort of users who transact (or purchase) for weeks 1, 2, 3, and 4 for new and current users. You can see that the retention rates are significantly higher for the cohort of existing users than for new users.
The week 4 retention rate is 20% for existing users and only 5% for new users. This means that the repeat purchase rate among existing users is 4 times higher than new users.
The data proves the conventional wisdom that existing users tend to transact more on the app. It also means that it is far more profitable to engage more existing users and convert them into loyal users who keep transacting often than acquiring new users.
Get the Complete Ecommerce Benchmark Report
The full report consists of user onboarding benchmarks, user engagement benchmarks, user retention benchmarks in an expanded fashion, and user uninstall and reinstall benchmarks. The report also includes recommendations to help engage and delight your customers at each lifecycle stage.
