The True Cost of Failing to Put Your Customers First

key takeaways from Elastic QA (2)

When you’re building an app, it can be easy to get lost in the idea that just because you were the one with the good (possibly even great) idea, that you know what’s best for the finished product. 

But, if you build your app with only your considerations in mind, then you run the risk of not creating a product that people are going to use.

Your customers have to be at the heart of everything you create. Even if you know it’s a product that people will use, their needs should be at the heart of everything you’re doing. Failing to put your customers first will result in the loss of business in three core areas - user acquisition, engagement and retention. 

Before we dive into the details of this blog post, we wanted to highlight an upcoming webinar from our co-founder Ronald Cummings-John focusing on the three most effective and impactful ways to to becoming more customer centric in your QA strategy - reserve your place now!

User Acquisition

Users are going to know within the first few minutes of using an app whether or not they want to continue using it. If it’s not what they’re looking for, they’re going to uninstall and find something else to help them solve their problems. 

It’s easy to shrug this off as just a part of doing business but think about this - in 2019 alone 25% of users who downloaded an app, opened them once and never touched them again. A full quarter of the 204 billion apps downloaded that year had one chance to make a good first impression and 51 billion failed. 

This hurts because not only are people not continuing to engage with the app that you’ve built, but, as of 2019, the average cost to acquire a customer was $3.52 (USD). If you’re losing 25% of those customers, that’s a lot of money you’re missing out on because you’re not connecting with users in a meaningful way from the start. 

One way you can avoid this churn is with a solid user onboarding process. Onboarding is critical because it gives your users a hand figuring out how to use your app, provides helpful tips and tricks, and answers common questions that new users have about the product. 

We’re a fan of the 3S Principle for user onboarding. It should be: 

  • Short - Don’t bury your users with an app that requires hours to get up and running. The fewer steps, the better. Users get turned off by onboarding processes that result in too many emails in a short time. You want to welcome your customers, let them know what they need to know to get started, and maybe provide a few handy tips. If you’re sending 7 emails in 24 hours, you’re doing it wrong. 
  • Simple - Not only does onboarding need to be short, but it also needs to be simple. Very few people are going to jump through a series of increasingly complex hoops to use your app. Luckily, by keeping the process short, you force yourself to simplify it down to the minimum number of steps needed to get started. You can introduce more complex topics down the road, once users have had a chance to play around with things a little. 

  • Seamless - The goal of your onboarding process should be to get the user doing what they set out to do, with as little friction as possible. That’s why we recommend keeping it short and simple. You want users to feel like getting started is a natural process, not something that takes them out of the app into a different environment that they’ll be working in.

The best thing is that a good onboarding process doesn’t just boost user acquisition. As we’ll see, it has a lasting impact on users.

Engagement

One of the best ways you can boost engagement early on is with a good user onboarding experience. An efficient onboarding process can boost engagement by as much as 50%

It’s not just about the onboarding process, though. Your app needs to provide enough value to users that they continue to use it. It can take anywhere from 18 to 254 days for people to form a new habit, with the average being around 66 days. The challenge here is that the average retention rate for apps is only 4.1% at 12 weeks or 84 days. That means that you’ve got your work cut out for you when it comes to engagement. 

One effective way to boost engagement is with push notifications. Sure, not everybody loves them (or even tolerates them), but there is a 30% boost in engagement among users who allow you to send push notifications. The trick is they need to be relevant to your users, personalized as much as possible, and they should be actionable, meaning they encourage you to either engage with the app directly through the push notifications or to hop into the app to complete a task. 

Beyond that, your app should be as accessible as possible. This means that not only should you be able to get the same functionality across platforms, but more importantly that all users everywhere should be able to use your language, regardless of the language they speak or their abilities. 

Accessibility is an increasingly important aspect of app building. In the United States alone, 16.5% of adults have trouble hearing and 12.9% of adults have vision problems. That’s a combined total of 73.5 million people who might potentially want to use your app. But, if you build without accessibility in mind, you’re basically preventing those people from using your app. 

Retention

It’s cheaper to keep existing customers than it is to acquire new ones. This idea gets tossed around a lot, but it’s not without merit. When you look at the numbers, it costs 25 times more to acquire a new customer, than it does to retain an existing one. That means if it costs you $3.52 to acquire a new customer, it only costs $0.88 to keep a customer. 

The big reason for this is that existing customers have to be wooed. There’s marketing collateral, time spent with sales talking about features and doing demos, you’re answering questions. You end up devoting more resources than you would with someone who just needs to hit renew (although it’s probably quite that simple). 

A small 5% boost in retention, can lead to a whopping 95% increase in profits. But the question remains, how do you do that?

The first way is to make sure that your app does what it promises. Your customers are coming to you to solve a problem, if it doesn’t solve a problem, it’s no good to them. The second thing you can do is to keep adding value. This typically either adding new features or simply making the overall user experience better in some way. The more you help your customers succeed, the more likely they are to stay. 

If you’re really stuck, talk to your customers. Ask them if there’s anything you can add to make your app better, if they’re experiencing new problems that you could help them solve, if there’s anything the app does that drives them crazy and questions like that. The more time you spend talking to your customers, the more successful you’ll be in retaining them. 

This could mean hopping on a call to actively talk (this can be easier if you have a customer success team) or in-app surveys. Anything you can do to talk to your customers will be a win. 

Want to know more about putting your customers first?

We don’t blame you. The advantages of both talking and listening to your customers greatly outweigh the downsides when it comes to building apps. 

Customer-centric products have been on our minds a lot lately because of these advantages. So much so, that we put together an ebook called A Tech Leader’s Guide to Becoming Customer-Centric to help understand the finer points of putting your customers first. Want to learn more? Download the ebook today.

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