Once the development of your financial app is complete, it’s time to focus on certain key metrics to achieve success. Clearly, having users is one of the main goals. However, having users and retaining them are not the same thing.
To retain new users in a digital wallet app, it’s necessary to minimize friction as much as possible. This process requires understanding retention metrics and being able to identify the main issues. Among the ways to retain users are improving the experience, eliminating bugs, and more.
In this article, we’ll show you the best strategies for understanding and improving new user retention. Keep reading to get all the information you need!
Basic Problems in User Retention for Digital Wallets
User retention is not an easy task. Many apps face significant challenges in keeping users active after the first week. This issue is not exclusive to new companies in the industry.
According to CNN Business, just three weeks after the launch of Threads, the fastest app to reach 100 million users, there was an 82% drop in daily users.
This can be due to several factors, such as poor user experience, unresolved technical issues, or even a non-existent need in the target audience.
On average, only about 25-30% of users continue using an app after the first week, and this figure tends to decline even more over time. Understanding these metrics and comparing them to your own digital wallet app is the first step in identifying areas for improvement.
What Are User Retention Metrics?
Retention metrics are key indicators that allow you to understand how many users continue interacting with your digital wallet after their first experience. Additionally, these metrics can help you identify friction points and understand how to reduce them. Some retention metrics include:
Daily Retention
This metric lets you see the percentage of users who return to the app the next day. In apps like social networks, evaluating this percentage tends to be more important.
Weekly Retention
This metric shows the percentage of users who return after a week, helping you understand user needs. Moreover, download-related metrics can be used to gain even more insight into user behavior.
Monthly Retention
Monthly retention evaluates the percentage of active users after a month. Some apps with more sporadic use focus more on this metric to understand user behavior and also see when in the month they experience the most traffic.
All these metrics help you understand at what point in the process and under what causes users to decide to stop using the digital wallet or continue using it.
Why Is It Difficult to Retain Users?
Retaining users has its challenges in more than one area. It’s important to understand the different reasons why a user might decide to stop using a digital wallet app. Here are some examples!
Friction in Usage
Complex processes and technical jargon in banking apps can discourage users. Additionally, in some cases, there is a lack of fluidity that ends up frustrating and tiring users, leading them to seek other more direct or less technological solutions to solve their problems.
User experience is essential for retention. Here are 6 ways to improve user experience in a fintech app.
Multiple Options
There are currently so many options available that users can feel overwhelmed and abandon apps quickly. Even if not all wallets or financial apps have the same features and benefits, users may not be able to distinguish the advantage of using one app over another because they are too exposed to information.
Digital Overload
Notifications, content, and recommendations are everywhere in this digital age. All this information can lead to digital fatigue and make users prefer not to be involved at all. Instead of creating a herd effect, overly aggressive user attraction techniques often result in abstention.
Lack of Understanding
If the features, flows, and processes of an app are not clear, it’s very likely that the user will give up. In any case, the interest in using the digital wallet lies with the company, not the user. If the solution is presented in a complicated way and the user doesn’t understand it in their first attempts, they are likely to become frustrated and stop using the app.
How to Retain Users
To improve user retention, it’s essential to adopt strategies that address the mentioned problems.
Remove Friction
Simplifying processes within the digital wallet is crucial. By removing friction, users can complete transactions and tasks easily and achieve their goals within the app.
Improve UX
Improving user experience and having an intuitive design can keep users interested and engaged with the solution. By creating attractive flows and processes for users, you can drastically improve retention since they will enjoy using the app.
Bug Removal
If there are technical errors and the app has bugs, it’s very likely that users will become frustrated and abandon the digital wallet. That’s why eliminating bugs and ensuring optimal app performance is key to retaining users.
Add Specific Features
Users, through their needs, indicate the features to be created. That’s why adding features that directly address pain points or problems that users need to solve is key to retention.
Product Management
The product must always be in constant evolution. That’s why including product management processes can help maintain a constant cycle of product evaluation and improvement, based on user feedback and needs assessment.
Here’s a list of essential tools for developing your app!
Conclusion
User retention is an ongoing challenge, but with the right strategy, it’s possible to keep your users active and engaged with your app. By addressing UX issues, improving functionality, and reducing friction, you can create a user experience that not only attracts but also retains them.
Ready to Take the Leap with ThinkUp?
ThinkUp offers a dedicated team with industry experience to help you achieve your goals and improve your retention rate. Learn more by visiting our services!
