I’m commonly asked by our customers and prospective customers if a mobile app’s speed truly and directly affects business KPIs. For different brands and businesses, the most important KPIs vary. They can be more purchases, more sessions, more subscriptions, more ad realization and so on.
For the past 20 years, people in the broader “web” world have definitively learned that speed matters. The speed of a website has a direct and measurable impact on user behavior and on business success. The faster the website or web application, the higher their business KPIs. The entire CDN industry was created on the back of this key realization.
Using billions of data points, Wal-Mart reported a direct and measurable correlation between website speed and conversion rate. While everyone knew that web performance was important, they showed with data (for example – for every 1 second of improvement, they gained 2% higher conversions) that it directly impacted revenue.
Google came at speed’s importance from another angle. When web searches took longer to complete because of latency, users stopped searching as much. Slowing down the search results page by 100 to 400 milliseconds had a measurable impact on the number of searches per user, with 0.2% to 0.6% fewer searches for slowdowns of under half a second.
At Neumob, we assumed that these lessons we’d learned from the “web” world would have naturally been passed over to the “mobile” teams we interact with. However, we found that many mobile app owners had open questions on whether mobile app speed matters, and if it affects their business KPIs. I can emphatically say that mobile app speed matters. It has a direct effect on more sessions, more bookings, more views, more searches or whatever the key business KPI is that our customers need.
Now using millions of data points, I’m glad to share some exclusive data from Neumob that shows how speed directly correlates with bookings/conversions. The user base for this popular mobile commerce app is, in this case, primarily located in developed countries across the United States and Western Europe. The effective throughput was measured for large objects only, so this is actual throughput and not theoretical bandwidth. As most mobile users learn, even a LTE signal with a theoretical download rate of 100 Mbps will at most provide a 14 mbps actual experience in the best of circumstances with a best-in-class mobile provider. Most providers are far worse than this.
Just as with faster web pages, an increase in throughput (and therefore overall app speed) led to soaring conversion rates. Users who had an effective data throughput of 3 Mbps vs. 2 Mbps had a 10% higher conversion rate (from 2.0 to 2.2). The same effect was noticed for users with 6 Mbps throughput vs. 4 Mbps, with all the added revenues and immensely satisfied users that implies.
Perhaps even worse is the rapid dropoff for slow connections. While there are die-hard users who will purchase no matter how poor the experience is, clearly most will not. A 3G user with a mediocre 500 kbps throughput is 33% less likely to convert than someone with the highest 1.4 Mbps throughput. Is that an abandonment rate you’re willing to tolerate?
This is how business KPIs are being redefined for the era of mobile apps. It turns out that users are happy to spend more time with your business and convert more frequently when you give them a faster experience – a truism that still holds true whether they’re living their digital lives on a desktop computer or on a modern smartphone.