Engaging Consumers Through E-commerce Apps Requires Design Thinking

Almitra Karnik

October 18, 2019

Branded Mobile Apps are Becoming Essential for Merchants. Here’s How to Optimize the Lifecycle Experience Using a Holistic, Data-Driven Approach

As it turns out, customers are even more fickle on their smartphones than they are in your store. According to a recent e-commerce app benchmark study by CleverTap, only 14.65% of users stay with a downloaded e-commerce app after thirty days. One-fourth of all apps are used only once before being discarded; furthermore, Gartner predicted in its study that less than 0.01% of all consumer mobile apps will be considered a financial success by their developers.

For any merchant, those are tough statistics to confront. It’s possible, however, to outperform the typical e-commerce app experience throughout the consumer lifecycle. And it all starts with a design approach.

Design Thinking, a discipline popular in software development, is an iterative process that seeks not only to understand the end-user but also to challenge assumptions and conventions to improve performance. Five elements comprise the Design Thinking regimen:

Empathize with the user’s mindset, experiences, capabilities, and expectations
Define the design and usage parameters, based on the conclusions reached
Ideate with an emphasis on non-traditional, out of the box concepts that challenge norms
Prototype appropriate solutions
Test and if necessary, return to any or all previous phases with new learnings, redefinitions, and/or performance improvements

Design Thinking has real value in the e-commerce space. Repeat purchases, for example, make up only 8% of all customers, but up to 40% of Sales. Landing loyal customers is the most expensive part of Sales—so smart app design and management, and the relationships those disciplines foster, are essential to business success.

The best place to start is by capturing, analyzing, and leveraging key user metrics. Industry benchmarks help to measure the effectiveness of campaigns and tactics, and can reveal opportunities for improvement throughout the app lifecycle:

Onboarding/Usage. From the moment users first experience your app, look for ways to make your company and its products attractive. An appealing welcome screen is important; animations, rotating news, and special offers all create interest. Ask for one-click registration for offers and push notifications and provide quick tips to help users get started.

Some of the important metrics to follow are Install to Registration Rate, Average Time to Register, Average App Load Time, Average Cost per User, and Crash Rate. You can improve on all these measures by making the sign-up process simple and by using incentives to encourage registration. Other tactics to build usage include periodic push notifications, requests to leave product reviews and recommendations, and campaigns directed at repeat purchases.

Engagement. Every time a user opens your e-commerce app, you have an opportunity to deepen the relationship through new experiences and suggestions. You can gauge your effectiveness in this regard by monitoring frequency of interactions and click-through rates for push notifications and in-app messages. Session frequency—how often users come back—is also important.

To build engagement, consider providing suggestions to users upon their first purchase. For those who haven’t yet purchased, offer product recommendations based on shopping behavior. Rewards programs have an important role to play as well.

Retention. Keep in mind it’s less expensive to retain customers than to capture them. 86% of all shopping app users churn within four weeks of download; without retaining existing users, new downloads are simply filling a bucket with a growing number of holes.

Fortunately, there are many ways to combat churn. Conduct campaigns that reflect the number of days (1, 3, 5, and 7+) since the last launch, and emphasize the benefits of your loyalty program. You can also run drip email campaigns 14, 21, 28, and 42 days after the last purchase, with offers, discounts, and recommendations. Gamification helps, especially with Millennial audiences. Using games and contests brings up customer satisfaction scores, repeat purchases, and average transaction value. Finally, customer support has been proven to have the highest impact of any factor on repurchase, so make sure you deliver a delightful experience.

Metrics to track in the quest for retention include App Stickiness, Average Revenue per User, and Customer Lifetime Value. Advanced segmentation by psychographic traits will enable better campaigns and user messaging.

When activity stops. The industry benchmark for uninstalls within thirty days of first launch is 42%. Of those, just 5% will reinstall. It’s an uphill battle to regain users—but possible, using discounts or by granting access to exclusive products. Be sure to ask for feedback on why a user has uninstalled whenever possible.

The e-commerce field is in constant flux. To be successful, it’s critical to focus on the entire user lifecycle; but amidst all the statistics, metrics, and analytics, never forget that at the other end of your app is a real, live person. Respecting their habits and preferences is the only way to satisfy their needs—and yours as well.