Mobile Application Development 7 min read
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Mobile Application Development 6 min read
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Mobile App Analytics Fundamentals: Key Metrics to Monitor
- 09 Dec 2022 7 min read
Mobile app analytics fundamentals are crucial to taking the lead in mobile app development because it’s one thing to create an app, and another to market it.
As the world continues on its path towards a mobile-first way of life, the benefits of mobile apps for business are becoming more apparent. After all, everyone relies on phones as our lives become more enmeshed with the apps that are on them.
Massive consumption of apps and the elimination of physical barriers in development through cloud computing services are driving the app industry to exponential growth. And if you’re eyeing a piece of the pie, then building the app is the least of your worries.
Marketing it to users is, arguably, the difficult part of the job as you think about the need for downloads, user retention, and more. Investing in app development requires proper direction, optimization, and promotion, or else your supposed asset turns into a liability.
This is where mobile app analytics fundamentals will prove vital to your strategies.
As you know, in anything to do with digital marketing, accurate analytics tracking is the crucial key to success. Knowing your metrics will unlock the forward steps you need to take not just in optimizing your apps, but also marketing them to your intended users.
The key metrics in mobile app analytics fundamentals
In optimizing the performance of your brand app, you must track data to be able to form strategies that drive better results. It’s only with this data-driven mindset that you can execute accurate campaigns and marketing experiments that drive continuous growth.
We discuss these metrics – what they represent and why they matter – in detail, below. You’ll find as well that these metrics are categorized according to which business and marketing objectives they meet.
- Revenue metrics
- Engagement metrics
- App store and install-related metrics
- Advertising-related metrics
Careful notice of which metrics apply to which objectives is also critical to accurate strategies. So remember to match them appropriately with your goals.
1. Revenue metrics
Revenue is a hard business metric that you will need to measure so that you can ensure that your app is functioning as an asset, rather than a liability. Remember that this is computed in net, rather than gross revenue. Hence, you should also be looking at cost metrics.
Below are the revenue-related mobile app performance metrics you should monitor closely.
Cost Per Install (CPI). This refers to the cost an advertiser pays per user install. By tracking CPI, you can measure campaign effectiveness and manage ad expenses more effectively.
You can compute this by dividing your ad spend by the total number of installs you generated from the campaign.
Cost per install (CPI) = Ad spend / total number of installs
Average Revenue Per User (ARPU). Refers to the average amount of revenue generated per user through purchases, subscriptions, downloads, or other forms of in-app monetization. ARPU tells you how much revenue you earn per person and clues you into what they are willing to pay for in the app as well.
It’s computed by dividing the revenue from a specific time period by your total number of app users.
Average revenue per user (ARPU) = Revenue from a specific time period / Total number of users
Return on ad spend (ROAS). ROAS refers to the amount of revenue earned from a specific paid ad or campaign for your mobile app. Simply put, the higher your ROAS, the more you earn from your app.
This is computed by dividing the revenue from the ad campaign by its cost.
Return on ad spend (ROAS) = Revenue from ad campaign / Cost of ad campaign
Lifetime value (LTV). Lastly, LTV refers to the amount of revenue your users generated from the time they installed your app. This KPI determines your users’ value, also known as their prospective revenue, for your business app.
You can compute LTV by dividing the total revenue you generated from the time the user installed your app by your total number of users.
Lifetime value (LTV) = Total revenue generated since install date / Total number of users
2. Engagement metrics
The next set of metrics you need to check are your engagement metrics. These metrics indicate the quality of your user’s interaction with your app. Or, in other words, whether they like using your app or not.
Retention rate. Is the percentage of people who install and use your app in a specific time period. This rate roughly indicates the amount of value your app provides for users.
The higher your retention rates, the better the value your app adds to customers’ lives.
It’s computed by comparing your total number of active users in a given specific time period versus the number of app installs. Multiply it by a hundred to get the percentage value.
Retention rate = (Number of active users over a specific period of time / Number of app installs) x 100
Average sessions per user. This refers to the average amount of time that people spend on your app per visit. A session usually begins when a person opens your app and ends when they exit the app or stop actively using it over a certain time period.
By measuring your app’s average sessions per user, you can strategize for content or actions that better engage users for longer periods of time on the app. It’s computed by dividing the total number of sessions by the total number of app users.
Average sessions per user = Total number of sessions / total number of users
Conversion rate. This last metric for app engagement refers to the percentage of users who “convert” or complete the desired action on your app.
Some examples of conversions are purchases, newsletter signups, ad clicks, or other in-app actions. When your conversion rate is high, that usually means your user flow is effective in leading customers toward your desired actions.
It’s computed by dividing the total number of conversion on your app by the total number of users, multiplied by one hundred.
Conversion rate = (Total number of conversions / Total number of users) x 100
3. App store and install-related metrics
When you’re trying to drive App Store optimization for your mobile application, you need to keep an eye out for the following app and install-related metrics.
Organic and non-organic installs. Organic installs refer to the number of app downloads that users do without direct influence from a paid digital marketing campaign. Meanwhile, non-organic installs refer to the number of app downloads that occur due to the direct influence of a paid digital marketing campaign.
By comparing these two types of installs, you can see which one does better among customers, and identify actions to optimize each install type.
App Store conversion rate. This refers to the percentage of users who visited the app store and downloaded your app from your app store page. By gauging your app store page performance, you can identify and optimize sections of your page to ensure more downloads in the long run.
You can compute for this metric by dividing the total number of installs by the total number of users found on the App Store, multiplied by one hundred.
App Store conversion rate = (Total number of installs / Total number of users on the App Store page) x 100
4. Awareness and advertising campaign-related metrics
Last but not least on this list are your awareness and advertising campaign-related metrics. These generally indicate the effectiveness of your advertising campaigns in generating awareness for your app, which can lead to its further development in the coming year.
Click-through rate (CTR). This refers to the percentage of users who clicked on your campaign’s ad, out of all the people who actually saw it online. CTR can indicate the effectiveness of your ad creative, depending on the number of customers who clicked on it after viewing it.
You can compute this by dividing the total number of clicks for your ad versus the total number of views, multiplied by one hundred.
CTR = (Total number of clicks / Total ad views) x 100
Click to install (CTI). This last KPI refers to the number of customers who clicked on your ad creative and then went on to install your app. This is the most direct measurement of your ad campaign’s effectiveness as it measures the direct conversion of a customer between two of the strongest touchpoints in a potential user’s journey.
Compute for CTY by dividing the total number of installs versus the total number of clicks your ad received. Then, multiply the quotient by one hundred.
CTI = (Total number of installs / Total ad clicks) 100
Data analytics tools you can use to get started
Now that you know more about the top four mobile app performance metrics, you can finally leverage them to optimize your brand’s apps for better business performance. Here are some useful data analytics tools that you can use to get started on your optimization journey today:
- Google Analytics. This top analytics tool will help you measure and optimize customer retention and engagement through easy-to-use SDKs and reports for mobile applications. Google Analytics SDKs are available for Android, iOS, and other platforms with their Measurement Protocol.
- Google Ads. This second analytics for apps tool specifically drives ad campaigns on Google’s advertising network. With Google Ads, you can create an ad, choose a budget, and set specific campaign goals, all geared towards promoting your product in optimized ways across the tech giant’s broad ad network.
- App marketplaces. General app marketplaces like Google Play and the Apple App Store usually provide useful marketing analytics to drive mobile app development. These marketplaces can give you insights on target keywords, metadata, installs, store rankings and other marketing analytics to influence your visibility and performance on the app store.
- Mixpanel. Another useful analytics tool is Mixpanel. This essential conversions platform helps you collect data on the customer journey and conduct various analyses to convert, engage, and retain more users. Mixpanel also offers free trials featuring perks like unlimited data history, core reports, monitoring, and alerts.
- Glassbox. This last example was recently rated as G2’s “Highest Satisfaction” and “Easiest to Use” mobile app analytics tool. Glassbox is a platform that offers web, native mobile or hybrid app analytics in one go, providing insights on cross-channel behavior without the need to change tools or lose data.
By integrating data analytics tools into your development process, you can keep a better eye on your metrics and KPIs. Do your research and select the right tool for your needs so that you can drive mobile app wins for your business today.
With the right set of KPIs and success metrics, you can optimize your mobile app and drive better business results consistently today. Here are some final takeaways for you to keep in mind when developing your newest mobile app:
- Collect feedback constantly. The most effective way to improve your mobile executions is by collecting feedback. With the right feedback, you can assess your performance and propel your business toward success.
- Keep your analytics simple. While metrics are essential to the success of your business, you needn’t overcomplicate analytics to win at mobile either. Weed out irrelevant metrics and identify the most useful measurements for your needs so that you can optimize these more efficiently.
- Watch and learn from your users. Who else is going to use your product if not your users? Their every action on your app indicates ways in which you can optimize your business performance. Watch and learn from what they do so that you can optimize your product for everyone’s long-term benefit.
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