App marketer Localytics has a new weapon to stop ‘churn’: a $35M investment

Based on the idea that past is prologue, marketing tool vendors are mining past user data to discover more predictions about users’ intentions.

For mobile app marketing/analytics platform Localytics, that forecasting opportunity is right after a user installs an app.

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The Boston-based company announces today that it has raised $35 million to further develop its Predictive App Marketing technology, which is now moving from a closed to an open beta.

The first use case: “churn.”

Often, that word means subscribers that don’t renew. Here, it means users abandoning their new apps.

“Twenty percent of users never come back to an app after the first session,” CEO Raj Aggarwal told me.

To keep users engaged with their apps — and hopefully buying other products or premium levels — Localytics’ predictive technology first segments out the users most likely to bail.

Currently, marketers with Localytics have to “create their own segments” of likely churners, Aggarwal said, based on their analysis of the data results. But the soon-to-be-released Predictive App Marketing automatically segments them by employing machine learning that, in theory, gets more accurate over time.

Then the marketer can send in-app messages, email marketing, push notifications, even same-device remarketing (follow-up messaging) to help turn churners into regular users. (The idea that messaging can help, of course, does not account for user abandonment because it’s a lousy app.)

Aggarwal said the capability to personalize the app experience for potential churners in on the drawing board. Eventually, he said, that could include a personalized app home screen — different user interface, perhaps, or content addressed to the user.

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“The future of apps is based around the personalization of experience,” he said. Which makes sense, given that websites have followed a similar route toward personalization.

Also on the drawing board: giving a marketer the capability to tweak the system’s segmentation of churners to just show, say, those forecast with 90 percent or above confidence level. And after churn, Localytics’ next use cases for predictive marketing could include segmenting those users most receptive to upsell.

Becoming a mainstay among marketing automation platforms and clouds, predictive analytics is now working its way through mobile marketing platforms.

Mobile marketing competitors often focus on the analytics/data side, or on the push messaging side, Aggarwal said.

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“Unlike a lot of companies with predictive analytics, we’re bringing the two pieces together,” he added.

The company, which started as a mobile-analytics platform, says it is currently supporting 32,000 apps across 2.3 billion devices.

In VB Insights’ recent report, “Mobile App Analytics: What winning mobile developers use,” Localytics rated as a favorite of developers. It landed the “highest overall score of any analytics solution,” according to the report.

This Series D round, led by Sapphire Ventures with participation from existing investors Foundation Capital and Polaris Partners, brings to $60 million the company has raised to date.

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