With the surge of online shopping in India, the Ministry of Consumer Affairs has recently proposed amendments to the Consumer Protection (E-commerce) Rules, which aim to implement more stringent policies on e-commerce retailers and prevent unfair trade practices. Despite these policy changes, India’s e-commerce sector is poised for high growth.
According to the recent analysis by Deloitte India and the Retail Association of India, the sector is estimated to reach $84 billion in total sales and 350 million online shoppers by the year 2025.
Due to movement restrictions to control the Coronavirus outbreak, Indian consumers have relied on mobile apps to do their shopping. But while e-commerce apps have made considerable gains during the pandemic, it hasn’t necessarily been driven by massive increases in installs. In fact, Adjust’s Mobile App Trends Report 2021 found that e-commerce installs only increased by 6 percent in 2020.
The big story was time spent in-app, which grew by 44 percent, showing that users became more engaged with the e-commerce brands they already love. This means apps hoping to win and retain new users in the upcoming online sales events like Flipkart Big Billion Sale must think strategically.
Here are a few tips that can help brands increase their user engagement and maximize the unique opportunities available for m-commerce during these events:
Do Not be Afraid to Spend - Brands should be willing to spend to acquire new users. According to Adjust’s data, the paid versus organic install ratio for e-commerce apps is high - 0.85 paid installs for every organic - versus an industry average of 0.45. Moreover, new users in this vertical tend to have good lifetime value (LTV) - and are backed by solid retention rates (13 percent on day 7 and 8 percent even on day 30).
Consider New Partnerships - No matter how great the app is, brands need the help of partners to find new audiences and drive installs. Adjust's data show the median number of partners per-app hovering at around five for all verticals - increasing to six in Q4 of 2020. But e-commerce apps lag behind most other verticals, working with just four partners on average. This presents a huge opportunity to increase and diversify the number of partners they work with to find their next pocket of potential and new users.
Reaching out to new users through a previously untapped network is good advice no matter what time of year it is, but there is no better time to experiment with new partners than during the Flipkart Billion Sale event. This serves as an opportunity for brands to branch out, give new partners a try, and discover a treasure trove of new users.
Put Retargeting to the Test - New user acquisition (UA) is essential, but as app marketers are increasingly aware, retention and engagement are equally critical to making the most of the company's UA budget for each new user. Brands need to ensure that they engage and interact with their current users, and spend as much time getting their attention on online sales days as they do when bringing in new shoppers.
While customer churn is inevitable, e-commerce also performs very well in reattributions. Data from Adjust shows that the reattribution rate (number of reattributions for every install) was 0.072 in Q4 2020 but was as high as 1.22 for e-commerce in the third quarter of the year - which presents another excellent opportunity for e-commerce apps. Pulling churned users back into the fold through retargeting timed with the most important shopping days of the year could prove to be a winning strategy.
Thinking Beyond the Sale
Consumers anticipate mega online shopping events every year and brands should not miss out on these opportunities to grow their e-commerce app user base. Shoppers plan and prepare for high ticket purchases and are likely to try new brands.
App marketers are wise, then, to think beyond the sales day(s) and define strategies to keep newly acquired users for the long haul. A retention and engagement strategy should be in place to turn deal-seeking customers into loyal shoppers all year round.