A key distinction between apps and websites that generate millions of dollars and those that monetize poorly can be narrowed down to a single point: How well their Publishers and Marketers understand the value of a customer. LTV, or lifetime value, is a metric that estimates the revenue a single user generates throughout their entire lifetime for a service. This metric can serve many purposes such as an indicator of an app’s success, a reminder of the power of loyalty, and a tool for forecasting revenue or growth.
Customer LTV can be broken down into three variables:
- Monetization: The monetary contribution each user provides to a Publisher’s revenue.
- Retention: The level of engagement and loyalty a user exhibits, looking particularly at the length of the average customer lifecycle from acquisition to churn.
- Virality: The sum monetary value of additional users a customer will refer.
Not all customers are created equal though. Each user interacts with an app differently and provides a different level of value, monetary or not.
Convert Users to Monetize Quickly
There are several reasons it’s important to monetize users quickly:
- Users that spend early, will spend more during their lifetime, increasing LTV
- Users that spend early, stay longer and have a deeper affinity to the service
- Users that spend early, are likely to refer other users and become an advocate
There’s a short window of time for catching a user and understanding their intent. What stage are they at in the funnel – is it someone who is looking for information or someone who wants to make a purchase? As a Publisher, it’s important to make sure that the user sees the right offer at the right time so you can deliver the right value.
This can be streamlined by creating audiences with specific characteristics. With Pyze, this process can be completely automated.
Pyze enables real-time explorations across a product’s entire user base to create relevant micro-segments. Publishers can explore multiple dimensions across segments, identify users across platforms, and reach out to the identified audience using rich push notifications, in-app messages, SMS, email, or integration with other marketing automation platforms. Creating targeted notifications for micro-segments maximizes early conversions because each user is getting meaningful and relevant offers.
Content & Experience Personalization
Pyze enables tagging each micro-segment with Personalization tags that can be used to personalize content and user flows to individualize each user’s experience. These experiences can drive users to convert or monetize quickly.
Automate Marketing Campaigns to Maximize Conversions
Just as automated campaigns enable a company to maximize opt-in conversions, automated campaigns can also maximize revenue conversions. Whether it is push notifications, in-app messages, emails, or SMS notifications, they are a great way to nudge users. When timed correctly, these channels provide tremendous potential for boosting engagement by developing a relationship with users through valuable, personalized messaging. But Publishers need more than just engagement – they need conversions. Statista reported that the total global revenue from in-app purchases for 2017 was nearly $37B. In-app purchases are dominating the industry and publishers are looking for ways to encourage early monetization to drive customer lifetime value.
Personalized messages that offer discounts or promotions encourage more users to make a purchase. Studies suggest that nearly ten times as many users will make a purchase when a promotional message or notification is received, compared to those who didn’t receive the message.
An example of a promotional message:
- “Thanks for downloading XYZ App! Enjoy 25% off your first purchase!”
When a user spends early on, not only does this increase engagement, but they are also much more likely to spend again. With Pyze’s Trigger Based Campaigns, Publishers can encourage new users to make a purchase (if they haven’t already) within the first few days of an app install or send personalized offers based on specific user behavior. This enables Publishers to engage users on autopilot to send the right message or notification at the right time. By getting a user to convert early in their usage, your app will drive a much larger customer lifetime value.