With more than 20,000 apps added to the app stores every month, it’s becoming increasingly difficult for brands to stand out from the crowd. Even if your brand manages to become one of the few apps used by mobile users every month, according to eMarketer, only 7% of users return to an app 30 days after they install it. In order to not waste the acquisition efforts, smart brands are using engagement strategies that are heavily driven by data analytics.
While the methods used in data analytics come in many different shapes and sizes, we believe that behavioral cohort analysis in particular has the ability to revolutionize the way we aggregate and quantify user data.
What is Behavioral Cohort Analysis?
A cohort, in its strictest definition, is a group of users who share some common characteristics. So, what is a cohort in the mobile ecosystem? A cohort is a group of users that completed a specific action (install, open, uninstall) for the first time within a particular window of time. Given this, you can evaluate a range of data patterns such as the rate of active users as well as set your cohort events to various in-app events to predict further user interaction with your mobile app.
Why is it Important?
Cohorts give you the capability to track user segments from a specific time period. Engagement rates vary not just between different users but also between different stages of those users’ lifecycle. Efforts at optimization — be it user acquisition, re-engagement, or retargeting — will often move the needle for some segments and not for others. For example, you might want to segment users based on which week they installed your app post launch and track their behavior as a cohort over their lifecycle. You can also test the effectiveness of different app marketing campaigns to see which channels give you loyal, active users in the long run.
On the other hand we should remember that personalization is one of the biggest keys to building users’ trust, loyalty and retention. Every user wants to receive special attention. One of the most effective ways marketers can achieve that is through personalization at every step of the user’s journey. Behavioral cohort analysis is the foundation of this type of personalization.
To sum it all up, we can say that the power of cohort analysis lies in the fact that, it enables not only to view which users leave and when they leave, but also to understand why the users leave your app – so that you can fix it. That’s how one can identify how well the users are being retained and also determine the primary factors driving the growth, engagement and revenue for the app.
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