B2B AI apps are facing a 📍 potential retention crisis. Consumer AI already shows 3x lower retention vs industry standard. How B2B AI app leaders are successfully tackling this challenge? ... with partnerships
Morgan Stanley recently highlighted a concerning trend: while consumer AI apps see strong user acquisition, retention plummets to single digits after just 30 days. The B2C data is stark:
Day 30 retention: AI apps 10% vs. incumbents 31%
Day 90 retention: AI apps 8% vs. incumbents 28%
This "leaky bucket" problem could soon hit B2B AI apps too. But top players are getting ahead of the curve.
Bessemer Venture Partners, a leading VC firm, shared key strategies that top AI B2B use to build strong competitive moats and drive retention.
Strikingly, partnerships are at the core of top 2 retention strategies for B2B AI apps. Here's how:
🎯 Embed through integrations and partnerships
B2B AI startups often start as a point solution with aspirations to evolve into a full platform. However, this strategy can make deep embedding into existing workflows challenging, risking lower user retention and engagement.
To overcome this, smart B2B AI startups are partnering with established platforms to seamlessly embed their solutions, boosting stickiness and leveraging existing user bases.
🤝 Meet users where they are
"Unnecessary friction to access a product" kills engagement, notes BVP.
It is not only easier to accelerate user acquisition by embedding product into existing workflows and showing it in places with high traffic. On a flip side, when users face multiple sign-in portals or complicated access paths, engagement drops.
To avoid this, top performers are making their AI accessible within tools users already frequent – think Slack or Microsoft Copilot.
📈 Cloud marketplaces are emerging as a powerful channel.
In Partner Insight we also see cloud marketplaces to significantly shorten time-to-value while simultaneously embedding product into many storefronts that users use.
✔️E.g. Microsoft recently reported the AI acceleration of their marketplace:
7x YoY increase in visits to transactable AI offers on marketplace.
140+% YoY growth in transactable AI offers published
When companies publish their apps on its cloud marketplace this makes them part of the catalog, which appears in various endpoints, such as Azure Marketplace and AppSource.
Not only business users can browse this catalog, but its applications can be surfaced directly into Microsoft products where customers are working daily - Microsoft Teams, Azure AI Studio, etc. This seamless integration could be a game-changer.
💡 The takeaway is clear: successful B2B AI apps aren't isolated tools. They're becoming extensions of existing enterprise workflows through partnerships and integrations.
What's your experience? Are you seeing B2B AI apps using these strategies?
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