Mobile App Retention Rate by Industry Category

Gaurav Rawat
July 10, 2024
14 mins


If users return to the application frequently, knowing how often that occurs will be beneficial to optimize the application’s performance. This is also known as the user retention rate. It reveals how many people are still in a position to affect the app, which makes it possible to establish the level of satisfaction the app can offer the users. The high user retention levels should prove that the application has much value in the market.

This fact indicates that there are typical user retention rates for every industry, and it is important to focus on them. Understanding the realities of the market and the industry standards is valuable for app developers and marketers, who will be able to set reasonable goals for the application and compare their results to industry benchmarks. This understanding enables powers to enhance the value of consumers’ loyalty and investment and attain significant sustainable business success in the mobile app market.

Calculating App Retention Rate

Calculating the user retention rate helps you understand how well your app keeps users coming back.

The formula for calculating the user retention rate is:

Retention Rate = ((E - N) / S) x 100


  • E is the number of customers at the end of the period
  • N is the number of new customers acquired during the period
  • S is the number of customers at the start of the period

The significance of cohort analysis in measuring user behavior and retention

Another important factor in calculating the app retention rate is cohort analysis. Since cohort analysis focuses on the performance within a given period, it is an effective tool for monitoring user activity and stickiness. This includes categorizing users by a common feature where they relate to the probability of extracting intrinsic characteristics from users. 

For example, during the first month when the application was installed, they monitored their activity over time. This makes it easier to make changes in the app's functions to suit the users because the interaction of the users can be determined and analyzed according to the group. Its formula is:

Retention Rate for Cohort = Installs at Start of Time Period/Users Retained at End of Time Period

For instance, if you have 5000 app installs at the beginning of the month and 1250 of those users are retained at the end of the month, your Retention Rate would be 25%:

1250 / 5000 = 25 %

Key Factors Influencing App Retention Rates Across Industries

There is no doubt that keeping users interested in your app is very important, especially in the current world where almost everything is done via an app. Lastly, the retention rate in terms of the user base that continues to engage with an app after the installation process is an essential aspect of an app’s success. 

It is also worth remembering that different industries approach the issue of app retention differently, as each industry has different conditions and prospects. Now, let us share some fundamental factors that determine app retention rates across different fields:

  • User Experience (UX)

“Your app might be a technological marvel, but don’t forget that it’s people who need to interact with it.” 

– UXPin.

User experience is one of the key aspects that many app owners chip away at the longest when it boils down to the issue of attachment. It is in the best interest of any application or website to provide users with a smooth and friendly interface they would want to return to use. 

Platforms like Nudge offer good usability so that the user is not confused about where to click, and the rate at which it loads the page should be good.

  • Personalization

It is important to note that making users of a particular site or platform feel appreciated is useful in personalization. The ability to personalize what is delivered, including experiences like in-app messages, walkthroughs, etc., depending on the user and his or her activities, can enhance the overall user experience. 

  • Push Notifications

Users could stay active via Push Notifications as the app just reminds them it is there and shares valuable information. But remember, these tools need to be used appropriately, or you may not get the desired results. However, users may feel alerted and receive too many notifications; they will disable the notifications or even uninstall the app. 

This is usually obtained using relevant and timely notifications to ensure people are engaged and continue to use the application. 

  • Regular Updates and Improvements

More frequent updates not only support the feeling that the app is still under development but also improve the controllability of errors or issues that appear. It is always beneficial to introduce more new options, remove defects, and optimize a program. All these actions can keep the consumers engaged and happy. In short, customers respond well to the kind of apps custom-designed to grow with them.

  • Onboarding Process

Like any business dealing with customers, the onboarding process is a critical initial interaction experience. An effective onboarding process is useful to ensure that the application's users are well aware of its usefulness and how the application can be used in making their decisions. 

If a number of users leave the app after creating the account, it is a sign that the onboarding process is complex, and users need to be prompted on how to use the app. 

Nudge offers a seamless onboarding experience that is easy to understand and fun to implement. Some of our features include:

  • Tooltips to take users from one action to the other
  • Onboarding tour to help users get acquainted with the app
  • Easy user interface that guides users through the process without any complications. 
  • Incentives and Rewards

When designing an interface, it can also be helpful when creating products and services to use incentives or rewards that the users can get for performing core actions. Special offers with the product or additional services, such as free points, coupons, or unique content, can help overall develop the perception of value and usefulness. 

Other experiences, such as the introduction of points and badges, are some examples that can complement functionality improvement to promote user interest and continuing participation.

Nudge offers a wide range of gamification and reward systems for customers. For example, Points System, Challenges, Streaks, Gamified Referrals, Quizzes & Polls, Scratch Cards, Coins, and Coupons.

  • Customer Support

Customer support is also a very important factor in the client’s decision to stay engaged with the company and use its product. Enabling a customer to get the help he needs is important for problem-solving and increasing the overall level of customer satisfaction. Again, the users will be more likely to stay if they are aware that they can get assistance from someone if the need arises.

With Nudge, you can contact the support team with a very easy and simple process via our official website. For any emergency, the support team gets in touch with you as soon as possible. 

  • Market and Industry Trends

Market and industry trends also affect app retention. For example, the apps in the health and fitness category may have a different pattern throughout the year; customers sign up in the new year to work on their new year resolutions. It may be necessary to keep tabs on the movement in the industry and update the app to ensure that user retention remains on the high end.

  • Social Integration

Social integration can enhance usage by sharing the user’s experience and accomplishments attained while using the application or even the content acquired from the application on social media. Guarantees such as reward systems in terms of ranking, sharing, and creating group pages can help users feel connected and motivated to continue engaging in the application/website.

  • Data Privacy and Security

With the advancement of technology and the use of social networks, the issue is now highlighted in its Data Privacy and Security aspects. In general, apps that guarantee data protection and privacy will create the app credibility so that more users will use this app for a long time. It was clearly seen that the general public is willing to embrace an app that guarantees their information security.

Industry-Specific App Retention Benchmarks

Understanding how well an app retains its users can vary across different industries. Setting industry-specific benchmarks for app retention rates helps businesses gauge their performance against competitors and identify areas for improvement. Here, we explore the benchmarks and key factors affecting app retention across various sectors.

1. Shopping and marketplace apps

The average retention rate for shopping apps on day one is 24.5%, which is slightly below average. The average retention rate on day seven is 10.7%, and on day 30 it is 5.6%.

2. Financial services and fintech apps

Traditional and digital banking apps have a combined day-one retention rate of 30.3%, day-7 retention rate of 17.6%, and day-30 retention rate of 11.6%.

3. Digital health and medical apps

For medical and digital health apps, the retention rate for day one ranges between 20% and 20.2%, while the 30-day retention rate goes around 7% to 8.5%. 

4. Gaming apps

On day one, the gaming app retention rate varies between 28.7% [for hardcore games] and 32.2% [for hyper-casual games]. By the time of day 30, it drops down by 20%, which becomes around 7% to 8%. 

However, popular game apps like PUBG and COD can have higher retention rates for a longer time, around 23%. 

5. Social media and community apps

When it comes to app retention rates for community and social media, the average is 26.3% on day one, 9.3% on day 7, and 3.11% on day 30. However, apps like Facebook and Instagram have higher retention rates, around 69.9% for 24 months. 

6. Media and entertainment apps

Across this genre of apps, the average retention on day one is around 22%. With an average rate of 8% by day seven. The average day-30 retention rate for entertainment apps is about 3.8%.

7. Productivity and utility apps

The average day-one app retention rate for utility and productivity applications is 17.1% to 18.3%. By day 30, it is around 6.8% to 7.2%. 

8. Hotel, travel, and lifestyle apps

Hotel, travel, and lifestyle app retention rate on day one is around 16.5% to 20.9%. On day 7, it gets about 7.6%, and by 30 days, it is approximately 3.6% to 4.5%. 

Strategies to Improve App Retention Rates

The reason why strategies are important when it comes to retention rates is that they assist in retaining users and keep them interested in the app, which reduces the chances of them abandoning it and boosts revenue. 

Effective strategies make it easy for users to use the app and find it useful, increasing the chances of them sticking with the app for much longer than they would with other similar apps. Here are some of the strategies to improve retention rates.

1. Making the app more interactive 

Interactive Elements can lead to increased traffic, and the overall usability of an app increases. It identifies application integrations such as product interactions, customer-content creation, questions and answers, and other appealing aspects of the application to enliven the users’ experience. Some forms of applications can be very engaging and thus make the users come back more often, depending on their interactivity.

Nudge offers a fun Game Zone experience for users, which increases average use time and helps users stay engaged by integrating games like Spin the Wheel, 8-ball pool, Carrom, and more.

2. Implementing in-app messages

In-app messages are important for keeping the user engaged and up-to-date with the application. Such messages can notify the users about special offers, new additional features, or changes within the application's functionality. In-app messages can be useful when they are delivered at the right time and correspond to the user’s activity; they do not require constant intruding push notifications to deliver a message.

Nudge offers features like in-app messages, contextual spotlights, coachmarks, PiP videos, challenges, and more.

3. Implement Loyalty Programs 

Another idea to boost the level of retention is to introduce and maintain loyalty programs. Loyalty programs are excellent ways to encourage customers to use the application frequently. You could enable users to accumulate points derived from their actions, whereby a user earns points each time they perform an activity, such as purchasing a product or inviting friends to the application. 

Some of these may include points that can later be exchanged for privileges such as lower prices or free products, encouraging the users to use the app continuously. They also increase their level, which in turn allows them to gain better rewards and other incentives as they constantly use the app. This leads not only to increased usage but also to a feeling of accomplishment along with becoming a part of a special club.

Nudge offers loyalty programs with gamification and rewards. We have many options like:

  • Points System 
  • Challenges 
  • Streaks 
  • Gamified Referrals 
  • Quizzes & Polls 
  • Scratch Cards 
  • Coins 
  • Coupons

4. Referral Programs 

Companies need to consider carrying out reference or referral programs to enhance the retention rates of the applications. The referral programs allow customers to introduce friends to the application, which has the potential to cause high interaction and optimized user churn rate. Here's how it works:

When users invite friends to join the app, the referrer and the invitee both get benefits like discounts, additional features, or in-app credits. This makes it beneficial for active users to invite others into the application and for new users to also give the application a try.

With Nudge’s Game Zone, your customers won’t be able to resist indulging in the program and referring to their friends and family. Mainly because we offer attractive, engaging activities with games like Chess, Pool, Carrom, Tambola, and more.

Referral also makes use of word of mouth through recommending people. That is why many people prefer to use an application this time someone or another suggested to them. This personal endorsement can, therefore, be effective in establishing a strong group of followers and users.

5. Simplify Onboarding 

“A poor onboarding experience is hard to come back from and is the fastest way to lose a customer. It’s crucial to actively think about the entire customer journey, Define it, Map it, Document it”

- Paul Philip

Making the app's onboarding process as straightforward as possible is another key factor for improving the app retention rate. For those who are using your app for the first time after downloading it, the first impression matters. A good initial interaction can influence the decision to stick around and utilize the application more consistently.

First, minimize the time it takes to sign up for an account with the site or app. Request only necessary information and provide opportunities to sign up using social networks. This makes it easy for the user, who is not flooded with numerous steps or questions from the beginning.

Give basic and concise directives on how to use the specific application. Use a set of brief tutorials in the form of bubbles with recommendations on the basic functionality or a series of short videos. This will help them appreciate the utility of the app and the best ways of using it.

With Nudge, you will be able to give your customers a simple yet effective onboarding process with easy-to-understand navigation and a fun user interface. 

The Role of User Experience in App Retention

A seamless user experience and well-thought-out UI/UX design are crucial for improving app retention rates. By focusing on these areas, app developers can create engaging and user-friendly apps that keep users coming back.

1. Importance of seamless user experience boosts retention rates

Seamless User Experience (UX) is important to ensure that users will continue to use an app once they are hooked to the app. In simple and effective terms, this is stating that if a user finds an app easy to use and finds it fun, he or she will be inclined to use it repeatedly. A seamless UX involves:

  • Easy Navigation: Finders should be able to ascertain this item from that item and should be able to navigate from this place to place from their searches.
  • Fast Loading Times: Every user wants an application that loads swiftly; otherwise, the frustration they experience will hamper them.
  • Intuitive Design: All they need is the ability to open and use the app as they do not need the tutorial to guide them. Two areas to focus on are the precise vocabulary to use and clear steps in the instructions given.

When an app provides a smooth experience, users are happy and more likely to use the app repeatedly, leading to higher retention rates.

2. The importance of UI/UX design in user retention

  • Attractive Visuals: There is some truth to the saying that ‘the eye is the window to the heart,’ especially considering the fact that an appealing application enables users to spend more time on it. It is easy on the eye because of its neat, clear, and simple interface with tight integration of colors and the typeface.
  • User-Friendly Layout: The layout and organization are to be coherent. Unused features and buttons are prohibited; the interface should not confuse users and make it difficult for them to find a menu or another button.
  • Responsive Design: It looks nice when the app is designed to suit all devices because everyone uses smartphones, tablets, or laptops. This will keep the user engagement on a level playing field which is important according to different platforms used by the users.
  • Feedback and Interaction: Informative responses like messages to confirm whether the input has been received or the process is in progress are useful for the user. For instance, animations help to point out something specific, sounds produce feelings, and graphics make the app more attractive.


App retention rates by industries are imperative for companies and ideal customer profiles through analysis through this report. Specific to various industries, each can encounter certain pros and cons to user retention. For example, the task of shopping apps could be to improve application usage and show users item recommendations that they might be interested in. However, the gaming application may focus on entertaining content and a frequent release to keep customers interested.

With the advancement in technologies, more strategies that would be implemented to ensure the apps remain relevant will also continue to be adopted. By learning more about the high-level retention rates in the sector, companies will be able to adapt their actions to the user's needs and achieve higher levels of loyalty. Therefore, it is vital for any firm(whether in the finance industry or any other industry) that deals with a mobile app to ensure that the users continue to be attracted, interested, and satisfied using the app.

To learn more about better app retention and growing your business with higher customer satisfaction, book a demo with Nudge today! 

Gaurav Rawat
July 10, 2024