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How to Leverage on The Big Sales to Maximize the LTV of Your User Base

Posted on November 1, 2019

As the biggest sale dates loom over us (think Singles’ Day in APAC or Black Friday/Cyber Monday in the West), app marketers prioritize increasing sales and maximizing results during the last quarter of the year.

App marketers will do well on truly leveraging on these super sales to break order records on sale days and beyond. However, while investments in User Acquisition (UA) campaigns are wise, marketers often overlook to elaborate on the crucial retargeting strategy. Recent Appsflyer’s data shows that when comparing retargeted versus non-retargeted paying users, the retargeted users show up to 21% in revenue lift for lifestyle and shopping verticals. This revenue lift has the potential to increase during big sales periods.

It is not uncommon to see app businesses making high investments in acquiring new users but disregarding retargeting. Considering that the cost to acquire a user is five to ten times more than the cost to re-engage a user, this is a risk you shouldn’t take. A healthy user base needs active users. Your UA investments might partially be in vain if you don’t actively retarget your entire user base from an early stage to enhance Lifetime Value (LTV)

As an app marketer, are you making the most out of a super sale?

To achieve the best results you can with retargeting, app marketers should take a holistic and hence detailed approach by catering to the different segments of their user base:

  • Retargeting the active user base to secure and enhance transactions.
  • Retargeting newly installed users to retain them early on.
  • Cater to lapsed users to recover their attention and invite them back.

Defining who you consider being your active and lapsed users as well as the most suitable retargeting strategy is particularly relevant during the big sales season. During crucial campaign days, you will have stronger and more appealing offers to communicate to your users that might compel them to stay with your platform for a purchase or return from a longer absence. From a cost perspective, it is certainly significantly less expensive to reactivate dormant users during promotional periods.

Read on to find out how you can use this tactic to unlock incremental ROAS during the big shopping sales.

The retargeting strategy you can benefit from during the Big Sales season

What the numbers tell us

Retention rates for mobile apps vary depending on the vertical. According to a recent report on eCommerce apps, only 19.72% of users are active in the app one day after install. This rate drops to 11.18% after Day 7, 8.71% after Day 14, and 6.78% after Day 28. Looking at industry benchmarks on a global average, the retention for shopping apps on day 30 after install is quite low (6-8%) when compared with other verticals like gaming (17%). This means there is a large pool of users that are becoming inactive and at the risk of churning.

Retention flow chart

With retargeting, it is possible to activate early on the customers who installed, browsed, purchased or not, and eventually never returned. Your investment does not have to be lost forever. And a big sale is an excellent opportunity to reignite the spark and to take advantage of the pull effect of promotions.

Pondering at the possible reasons for the users’ lapse will give you insights that can help you segment and retarget this user base more effectively. More importantly, the big sales provide you with fantastic, relevant product deals and exclusive offers that are more likely to attract lapsed users. Take the chance to entice your customers and delight them when they return. Reaching out to customers with a strong offer can get them to re-engage and improve the odds of turning them into not only active but loyal users.

Cost for bringing users back

Ecommerce apps with retargeting campaigns in place typically target their most active users as well as users that have recently installed. Transactional retargeting campaigns rely on Dynamic Product Advertising (DPA) to entice the users back to the shopping app. However, there is also the opportunity to grow and sustain a campaign by retargeting the users who have fallen out of the active bucket. Reaching out to the dormant users, at the same time we keep retargeting the active user base, is a strong tactic during seasonal sales periods to achieve lower reengagement cost per user and to grow a healthy active user base.

Successful-activation-of-the-user-base-0

Moving a bigger share of an app’s user base early and permanently to a higher “state of activation” results in lower reengagement cost as well as higher revenue. Transactional campaigns will yield higher ROAS as well as scale due to the more immediate availability of users willing to purchase on a platform familiar to them.

Recommendations to activate your entire user base during the big sales

  • Build your active pool of users, increase the lifetime value of your customers.

Users in the lower funnel tend not only to be active but also loyal customers of the brand, driving the most sales and engagement with your app.

To grow a loyal user pool, engagement for newly acquired users is crucial to create a positive experience, and bonding with your app. Hence, to assure long-term ROI, marketers should work towards a holistic strategy: UA in combination with early activation campaigns plus leveraging on cost-efficient retargeting campaigns during sales periods.

  • Timing is crucial

Timing your sale strategy to these users well before the sale day is key to reactivation. Show users what’s new. Does your shopping app have new features, new products, or better discounts during this sales period? Offers and messages like free shipping, up to 90% off electronics, and triple rewards can be shared consistently and intermittently to your users to build up curiosity and develop an intent to purchase on the D day.

  • Measuring your re-engagement campaign

Measuring your campaign from cost per reengagement up until the transactional cost per order can demonstrate the effectiveness of your campaign strategies. Marketers seeking to measure the ROI more holistically based on an LTV model can work closely with app retargeting experts like Remerge. Incrementality measurement helps marketers to explore the future of attribution-less uplift measurement that answers the most critical question in marketing today - what is the true incremental effect of my campaign?

Each Sale is a retargeting opportunity

Don’t dismiss the chances that these big sales present to fine-tune your message and create an effective retargeting campaign that can holistically improve your business position. Retargeting your entire user base with selective strategies during these key periods can unlock long-term gains.

Read more:

Contact us today at hello@remerge.io to find out how you can build a retargeting strategy to bring you long term results.

Marta Gaspar

Marta Gaspar

Content Marketing Manager APAC | Remerge

Marta is a content strategist and digital marketer with 8 years of experience turning ideas into prose for media agencies, online travel, e-commerce, and ad-tech companies. At Remerge, she works closely with our APAC teams to create engaging content about app retargeting and mobile marketing. When she isn’t in our Singapore office, she is reviewing books and practicing Aikido.

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