How to Measure the Effectiveness of a Mobile Application?
Analytics is an integral part of any promotion campaign, no matter what you advertise: a homemade bread or a mobile application. NinjaPromo has gathered the most vital metrics you need to take into account while building and upgrading your marketing strategy.

Mobile app metrics make it possible to know how a user interacts with the interface, to estimate the efficiency of the advertising medium and to act with dispatch to improve the existing tactics if needed. We have gathered the most important KPIs for your mobile apps.

1. Audience Gain

There are 3 significatives in the group, that shows in what way an app audience grows.

  • Downloads. The index sums up the number of app downloads in a given period of time;

  • New Users. This indicator shows how many new users have appeared within a day or a certain period of time. Given that we can call "the users" only those who open an app at least once;

  • Total Users. A resumptive index. It reflects the amount of new users in a certain period.
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In isolation from one another these indexes do not present any value for the analysis, but they are crucial for the calculation of other KPI metrics.

2. User Retention

Let's be honest, it's a common situation when a fresh user installs an application, tries it and … there are two variants of how things unfold: a user likes your app or a user dislikes it. If he or she dislikes it, an app can pass into oblivion or can be simply uninstalled. That's why there is no sense in estimating your audience just by "Total Users". The genuine estimation and calculation require the consideration of the next metrics:

  • Retention Rate. The percentage of users that open an app on the on the X day after the installation. It's usually calculated for the 1st day, a week and a month.

The indexes of this metric, calculated for the different periods of time will help you to turn your attention to the weaknesses of your project at the different stages of users experience.

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1st-day retention: as a rule, the reason for "ignoring" the app is the problems with the interface. A user may not understand what to click, for instance. Try to introduce so changes to your interface, to maintain the rated value. If you do that correctly, the positive results won't be long in coming.

7th-day retention: If the rate is much lower than the acceptable for your app category rate, analyze the usage scenario of your product.

28th-day retention. When users return to your app in a month it testifies about there satisfaction. But if the rate is lower than average it points to the fact that there is a strategic drawback.

But remember, that the acceptable retention rates for IOS and Android differ. For instance, 1st-day retention for IOS is 44%–10% while for Android it is 41%–15%.

  • Churn Rate. This metric shows the percentage of the loss of users. In this case, churn doesn't mean the users installed the app, it means that they do not open it anymore. You can calculate it this way: Churn Rate=1-Retention Rate

  • Uninstall Rate. And yes, this metric shows the rate of uninstallation of an app. You can count it by dividing the uninstallation number by the number of installation for a certain period of time.

3. User Activity
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Now we are moving to the metrics of users activity and engagement.

  • DAU/WAU/MAU. No, it is not a mantra. It shows how many unique users have opened your app within a day, week and month relatively.

  • Sticky Factor. It's a so-called engagement rate. It helps you estimate the frequency of app entry. Just divide DAU by MAU or WAU.

  • Sessions is an overall number of a run app within a certain period of time.

  • Average Session Length. An overall length of all sessions for a certain period of time divided by their number. It's an extremely important index if you plan to make money off advertising.

  • Lifetime. This metric defines how many days a person uses an app. For that, you need to take into account his/her first and last day of entry.

4. Monetization index

This group of metrics, that is directly connected with your revenue. The analyses of this data enables estimation of how often and how much users pay. Thus, you will be able to see how effective your monetizing methods are.

  • Paying Users — the number of unique paying users in a given period of time.

  • Paying Share — the percent of unique paying of a total number of users.

  • Paying Conversion — the same thing but among new users.

  • Transactions — total number of payments in a given period of time.

  • Transactions by User — TBU= Transactions/ Paying Users.

  • Gross — a sum of all user payments in a certain period of time.

  • Revenue — a sum of all user payments in a certain period of time minus store fees

  • ARPU. Average revenue per user=Revenue/Users. Remember that talking about Users we mean a total number of users, New users and Churn rate.

  • ARPDAU. Average revenue per daily active user= Revenue/DAU

  • ARPPU. Average revenue per paying user= Revenue/Paying users.

  • Average Check. AC = Revenue/Transactions. It's a average quantity of a payment.

  • Lifetime Value. LTV Unit values per one user within a lifetime. It is one of the most significant indexes, under which advertising profitability and efficiency of investments are counted. There are lots of methods of calculating that, we offer this one which is the most common: LTV=ARPU*Lifetime.

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5. Advertising efficiency

  • CPI. Cost per Install=Costs for advertising/Downloads. It's a quite relative index as the number of downloads usually aren't equal to new users.

  • eCPI. A similar metric but the virality is taken into account.

  • K-factor. The index of virality. Users share the information about an app by different means: links to social media, friend invitation, etc. Thus, K-factor=number of recommendations* percent of people that have converted to users.

  • CAC. Customer Acquisition Cost is a metric presented by the costs for one user attraction (here paying user counts). Thus, Costs for advertising/Paying Users.

For the finale.

Remember, no detail is too small in analyses. Do not forget, that what is really important while analyzing, is not metrics themselves but their right interpretation.

Keep track of what your audience is really interested in and constantly improve your application. Only this way you will be able to reach a self-sustaining level and stop depending on any investments. NinjaPromo wishes you good luck!

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16 March / 2019