Tuesday, October 23, 2012

Every Step Costs You 20% of Users

In a consumer mobile app, every step you make a user perform before they get value out of your app will cost you 20% of users.

Here's typical consumer app funnel. It applies to apps that do messaging (like GroupMe or DrawChat), but also posting content (like any app that ends with "-gram" a la Instagram and Cinemagram):

Your exact numbers might vary. With DrawChat, we found that 90% of people that land on the App Store page will install the app. The next step is to actually open the app, but only 90% of of the people who download your app will actually open it - I'm guessing that people are stockpiling apps for the impending apocalypse.

Sign-up is a much bigger hurdle than the previous steps: DrawChat's signup verifies your number via SMS which will get you completion rates around 70%. A startup I've talked to has seen completion rates as low as 50% with forced Facebook logins, while another one allows signing up with different methods (username/password, Facebook, LinkedIn) claims completion rates of 90%. Exact specifics may vary depending on what permissions you ask for.

Depending on the length of your funnel, you end up with 20-30% of the original users actually contributing to your ecosystem by creating and sharing new content.

What to do? There's not really much you can do until users get to the point where they've opened your app. But once a user has signed up, make sure you take them by the hand along the funnel. Make signup simple and unobtrusive. Make content creation easy. Come up with the simplest possible sharing experience. Because of the shape of the graph, you need to get each user to share with 3-5 friends for your viral coefficient to go above 1.


Updates / Reactions

1. mikebo asked on the Hacker News entry for this post how I know the number of App Store page views - it's not something that Apple provides. Excellent question. The answer is a bit involved.

People that don't have DrawChat yet get invited with an SMS that contains a link to a page on our server. That page redirects you to the App Store. So we know how many people see our App Store listing. On the other side, Apple provides you daily download numbers, which you then compare to the "first app open" counts on Flurry, Localytics, or your analytics provider of choice. We can also differentiate people who came to DrawChat organically vs. through invites by seeing if they had an invite waiting after sign up.

2. Shenglong asked on Hacker News if it's not better to start users in an "Explore" type experience instead of asking them to sign up immediately. This can be beneficial, but on the other hand, having an sign-in-less "Explore" type experience may actually hurt your signup conversions. Users get a feel for the app, decide that they'll sign up later, close the app, and never come again. I might be hallucinating but I think Instagram used to have an "Explore" screen with interesting pics pre-signup, and in the latest versions they got rid of that. Does anyone have data on this?

3. udit99 suggests that the 90% download-to-open ratio is not due to people stockpiling apps, but rather "attention-span-slippage caused by slow app downloads." I believe it.


Christian said...

stockpile for the appocalypse ;-)

Paul Stamatiou said...

That's why I like signup/onboarding flows that use gradual engagement. Show them the utility of the app/guide them through their first action before you actually have them sign up. We do this with Picplum -- drag photos in first before signing up.

Wil Wright of the Spore game says he strives to make users have their first "win" within 5 seconds. I think that definitely applies to any new user experience as well.

John said...

I was about to make the app-ocalypse joke too :-)

Ian Bell said...

A typical consumer web service signup is 2-4 steps. I've done a few of these, but have never once seen a 20% drop-off rate per step. I can't imagine that participants in this discussion have experienced a cumulative 80% drop-off in the funnel?!

So, while I like this discussion, perhaps the headline is misleading..

It's implicitly true that giving more up-front and getting users up and running as fast as possible is beneficial... however there is tension between fulfilling customer acquisition goals and managing your numbers for very good reason.

One tip I can share is to get their email address (or FB/Twitter account) first. The value of recovering from a failed funnel signup goes unstated. You should have a list of abandons on Mailchimp (or wherever) that you blast periodically, to try to recover from aborted signups.


Gabor said...

Ian - thanks for your comment.

As Paul said, the challenge becomes locking people in as quickly as possible - even before signup.

I guess my main point, aside from the specific numbers, is that mobile app users are incredibly fickle. You can't expect them to step through layers of signup and registration. Apps don't have very much time and space to tell their story before they have to deliver satisfaction to the user. That wil remain a big advantage for the web for many years to come.

SamGoody said...

There are just so many apps out there that users download apps to be able to find them later, though they aren't ready to actually play with it yet.
(That might be about 15% of the downloaders, but a third of them actually get back to opening it.)

The more complex but potentially useful the app is, the more likely it will be downloaded but not run.

Apps that are designed to help organize the clutter ought to have a higher rate of unopened downloads than yours does.

Dr. Keith Webb said...

We have a registration process on one of our mobile coupon sites. We try to collect the user's phone number on a splash page before entering the site in order to do SMS messaging. We've struggled with this...is it better to collect the phone number (lower opt-in rates) to do SMS messaging (higher open rates) or have them opt-in with Facebook/Linked-in (higher opt-in rates) and do email blast (lower open rates)? What a dilemma!

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chrisg said...

How about this: skip signup altogether. Distribute a GUID with the app, so you can take metrics on any given installation. You don't NEED anyone's name or email address.

When apps ask me to give them personally identifiable info prior to providing me any benefit, I immediately quit and never look back.