Customer Relationship Management: 5 App Growth Phases

In the past years, the topic of Customer Relationship Management has gained more attention for many companies operating in the mobile industry. The primary goal of customer relationship management is to build and maintain lasting relationships with customers.

Given the increasing cost of mobile user acquisition, retention strategies became increasingly important to engage the existing audience, with the aim of improving ROAS. Remember the saying, “It costs seven times more to acquire a new user than to retain an existing one”?

If we think that 25% of users who installed an app use it only once and that after three months, only 1.7% are still active, the picture is even more dramatic. Moreover, mobile companies invest a great deal in acquiring users who, in the end, do not interact with their products.

For this very reason, mCRM should play a centric role in our growth strategy.

A critical aspect of modern CRM, especially in the mobile domain, is the ability to identify and understand customers across various applications. This integration is key to a unified and effective CRM strategy, as it provides a comprehensive view of customer interactions and preferences.

Note: This article originally appeared on Business Of Apps.

The Importance of Customer Relationship Management in Apps

Customer relationship management in apps allows us to communicate with our target audience whenever and wherever they are, maximizing location and real-time communication. Thanks to it, we do not have to wait until our users are in front of their computers to communicate with them, but we can do so when and where we believe it is most appropriate for the purpose of our business.

Fundamentally, the goal of customer relationship management is to forge a deeper, more meaningful connection with users. By leveraging CRM in apps, we are better positioned to anticipate and cater to the unique needs of our users

For this very reason, retention strategies should play a critical role in any company’s growth activities as they can maximize user engagement rate, reducing churn rate (i.e., the uninstalls), but also improve the conversion rate in each step of the conversion funnel.

By enhancing those figures, the final result will be a Lifetime Value increase in our user base and, therefore, the maximization of our advertising spending and ROI.

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Customer Relationship Management for Mobile Channels

We can choose among different channels, depending on what we need to communicate to our customers and on the level of permissions we get from them:

• Push notifications: a short warning message appearing on the phone’s lock screen. Particularly useful for time and position-sensitive messages. They require a specific opt-in.
• In-app messages: screens of different dimensions appear directly inside the app when the user opens it or performs a specific action. They don’t require opt-in and work particularly well in combination with Pushes.
• Emails: useful to communicate longer and more articulate messages.
• App-inbox: a screen within an app that stores persistent messages. It’s kind of an email inbox, but it lives inside the app itself.
• Text messages: not used a lot recently, but they can help us reach all the users in a different (but maybe annoying) way.

All the above channels can be integrated (if the product allows) with desktop communications.

This approach is a cornerstone of digital customer relationship management, where digital tools and channels are employed to enrich customer interactions.

Usually, a successful CRM strategy is not based on the exclusive usage of either one or the other channel. Rather, it involves an orchestrated combination of all of them. For this very reason, the way to master customer management relationship activities for mobile apps is not simple or immediate. Let’s see now how to achieve success through organized steps.

Related: What Makes an Effective App User Retention Strategy?

5 Phases for Mastering Customer Relationship Management Activities

CRM for apps, like all other activities in mobile marketing, is not something that we set up once and then it’s done. It is rather an iterative process that starts with analysis—and never ends.

At REPLUG, we identified 5 phases that can help every company set up an efficient and effective mobile customer relationship management strategy according to their objectives and needs.

1. Audit: Understand the Conversion Funnel

Before implementing CRM activities, we need to know our conversion funnel perfectly. That doesn’t mean only knowing what the most important events for our mobile app are but also at which stage of the funnel the users drop, when, and at what rate.

In the audit phase, special attention is given to evaluating the effectiveness of our digital CRM initiatives. This phase is crucial to planning the activities and identifying an efficient strategy aimed at improving the key figures immediately.

Our PhotoSì Strategy

For example, when PhotoSì approached us to create a new communication strategy for their Referral Program (RP), the first step was to deeply analyze the conversion funnel and all the touchpoints the users had with the current communication.

In particular, the audit included:

• Post-order funnel analysis: what are the touch points with the users after they’ve placed an order? Are we using them all in the proper way?
• Analysis of the current referral program campaigns: how do we currently communicate? What are the key numbers?
• Identification of levers: based on the previous steps, what are we missing? What are the flaws of the current setup? What are the biggest opportunities?
• Tech stack inspection: do we have all the technology necessary to run (and track) effective campaigns?
• UX / UI evaluation: is the user experience of the app adequate to have a good Referral Program? Do we miss any app features?
• KPIs: what are the main KPIs to analyze in order to define success? Are we currently tracking them? Do we need to re-evaluate them?

Only after completing the audit were our experts able to identify the main challenge of this project—the limited exposure that users had to the Referral Program. Basically, less than 30% of the PhotoSì clients (with at least one order) knew about the possibility of earning credit by inviting a friend to use the app.

Given that, we managed to implement a CRM strategy combined with a new feature implementation, which resulted in up to +85% of new users coming from the Referral Program.

2. CRM Strategy: Create a Multichannel, Focused Plan

Once we have a clear understanding of the challenges and the objectives we would like to achieve, it’s time to come up with a precise strategy.

Of course, there is no clear formula valid for each app, but it rather depends on the different products/services offered and the company goals. Nevertheless, at REPLUG, we identified 8 pieces of advice to create a successful CRM strategy that can have positive effects right from the first weeks.

In general, the main piece of advice for creating a good customer relationship management strategy for apps is always to be focused on one objective at a time, using all the communication channels (pushes, in-app, emails, app inbox).

For example, in the case of Winelivery—one of our partners approached us with the specific need to improve their conversion rates for each step of the funnel. After the initial audit, we were able to create a strategy that entailed single campaigns for every single action required to be done by the users.

Having each campaign focused on just one objective allowed us to be extremely specific about the content and timing of the communications. In addition, thanks to a customized multichannel strategy, we were able to generate a boost in conversions by up to 150%.

3. Implementation: A/B Tests and Personalization

The strategy alone is not enough to retain users and improve LTV. That’s why we need to implement all the campaigns carefully.

In this phase, the most important things to keep in mind are:

• Personalization: customize the messages as much as possible, not only with the users’ names but with all single pieces of information we have about them. For example, use the name of the product they’ve visited in your e-commerce or the specific food they ordered last time in your delivery app.
  But also be careful with gender, location, and time of the day, with the only objective to make each user feel like we are talking exactly to them.
• A/B test: since the first campaigns, it is absolutely important to start testing different approaches to communication from the beginning in order to learn and improve every single step of automated communications.
• Use Deep Links: to be more effective and lead the users to the specific page of the app we want them to go to.

4. Analysis: Discover What Works and Improve

As in each mobile marketing activity, analysis is essential to understand if the strategy we implemented is good and how to improve it. For mCRM, in particular, it is very important to define the KPIs from the beginning and then measure the campaigns against them.

The indicators to keep under control are multiple and can be divided into 3 types:

• Campaign performances: they give us an understanding of how our single communications are performing, for example, email open rate, push notifications CTR, etc. Those figures directly impact the number of users who will read the messages and convert afterward—if nobody opens the emails, how can they know about the fantastic discount we’re offering?
• Campaign effectiveness: usually, those KPIs are represented directly by the conversion rates we want to improve with our activities. Is there a positive effect on the registration rate? Are the users purchasing more? Is the retention rate better after a specific campaign?
• Incremental value: eventually, we need to understand what value we’re bringing with the CRM activities. Is there an overall incremental boost in terms of Revenues, LTV, and ROI?

Generally speaking, to do this kind of analysis, especially for the last two types, it is a good practice to set up a “control group” for each campaign and even a general one in order to have a group of users who do not receive communications. In this way, we will be able to really understand the impact of our activities.

5. Optimize: React to the Analysis and Adapt to Changes

As already mentioned, customer relationship management for apps is not something to be set up and forgotten but rather a continuous process of analysis and optimizations.

That’s why each analysis should follow an action plan in order to improve the current communications (even if the results are positive, there is always something to improve).

For example, for another of our partners, we tested how to better communicate a discount with push notifications, splitting the audience into two equal parts.

Related: Building a Customer-Oriented Culture: How CRM Transforms Organizations

Our Test on Push Notifications

Group A: received a push including the word “discount” in the title and in the push text
Group B: received a push including the word “discount” only in the push text

And here is what happened:

• Group A (discount on the title) generated in total 6% more purchases than Group B
• The average revenue per purchase for Group A, though, was 10% lower than Group B
• Group A generated in total 4% less revenue (which can be very significant with a high amount of orders)

Based on the results above, we decided to adjust the communication strategy—still communicating the discount but not as the main element of the push because even if it was beneficial for the conversion rate (more orders), it wasn’t that good for the LTV.

However, optimization activities should take into consideration not only results but also the specific environment we’re operating in.

In particular, we should adapt our strategies to the market (e.g. new competitors, sales seasons, holiday seasons), or to special things happening in a specific geographic area (demonstrations, weather conditions, etc.) and never miss the opportunity of special events to communicate around.

An example? For the entire EURO2020 duration, Winelivery adopted the communication to concept of drinking to cheer the Italian football team. With this strategy, not only were they able to increase their volume of orders compared to the same period of last year, but Italy also won the Cup!

Conclusion

Customer relationship management definitely represents a powerful tool to maximize the retention rate, conversion rates, and, eventually, the Lifetime value of our user base.

Nevertheless, CRM activities need to be carefully planned through a prior audit, which can help us understand what are the specific needs. Without such analysis as a first phase, it is difficult to create a strategy that makes sense. Each app, each product, and each service have different specifics and peculiar conversion funnels.

Once the strategy is properly created, it needs to be implemented, including personalized messages and A/B tests that can tell us more about the way our customers would like to be addressed.

Only with continuous analysis will we be able to optimize our campaigns and promptly react to the changes happening in the environment in which the mobile app operates.

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Originally published on January 7, 2022. Updated on December 14, 2023.