45% users stop using shopping apps after 4 weeks of download

Chennai: Indian e-commerce apps lose almost half (45%) of users within first four weeks of install — with users either uninstalling the app or going dormant — making investments into e-commerce platforms a leaking bucket. Globally, 42% of those who install shopping apps quit in a month’s time.

The fiercely competitive sector is witnessing high churn and reduced engagement, shows data shared with TOI by marketing analytics firm CleverTap.

With almost 80% of online shopping transactions happening through mobile apps, engaging app users will be key differentiators for e-ecommerce players this festive season.

Further, next billion users are also expected to be exposed to e-retail through mobile devices. App stickiness for e-commerce is low with only 14 in 100 users continuing to be active at the end of the first week of app install, data shows.

Indian e-commerce apps also have to catch up with global counterparts in time taken to onboard new users. 80% of new users take an average 16 minutes to register, compared to a global average of 12 minutes.

Click through rates, a metric denoting successful conversions of campaigns and push notifications, is just at 1.3% for the industry, compared to almost 2.6% in consumer tech categories such as food tech.

Almitra Karnik, head of marketing, CleverTap, notes that low entry and exit barriers and a price-sensitive customer base makes acquisition easy but retention difficult for Indian e-commerce players.

“Marketers’ role [in e-commerce] is evolving from focusing on user acquisition to driving long-term metrics such as ‘customer life-time value,’” Karnik said, noting that investors too are looking beyond “vanity metrics” such as acquisition and downloads.

Amazon India said “offering the largest selection, at the lowest prices, and delivered in the fastest possible time” drives customer acquisition for them. Amazon also leverages light-weight app specially designed for low-end smartphones, a near-automated sign-up for first-time users, among others.

“We also have gamified experiences within the app to provide a fun, interesting and rewarding experience for customers every time they visit Amazon,” Kishore Thota, director - customer experience and marketing, Amazon India, said.

E-commerce platform Paytm Mall leverages its super app parent Paytm to drive acquisition and retention.

“Paytm has the largest install base in India with 400 million users. Paytm Mall has been focusing on converting Paytm customers to shop on Mall and hence are currently not focusing on doing any separate initiatives to drive installs for Paytm Mall app,” Srinivas Mothey, senior VP, Paytm Mall, said. Flipkart declined to share details on app acquisition and retention strategies.

CleverTap’s study analysed around 3.1 billion data points across 18 million devices globally, of which almost 90% related to Indian e-commerce.