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App Metric Guide: The Key Performance Indicators For Mobile Apps

Individuals and enterprises tend to relax after being done with the strenuous process of designing and building, thinking that their work is done. Unfortunately, that couldn’t be further from the truth. Well, not unless they want their application to succeed and pop off in the digital business world. Even after the company app is launched, there is much work to be done that carries great significance to ensure that the application proves to be helpful and fulfills the users’ requirements. Mobile app tracking is something every app owner needs to carry out if they want their venture to be successful in the end. 

Successful major companies accurately track various metrics to identify the essential improvements that need to be implemented for the application to perform better. These mobile app metrics help the companies gain valuable insights and determine how the mobile application functions. These values can help individuals and businesses realize the area that needs to be fixed and highlight the specific part of the app that requires an immediate update. 

People looking for a guide to fully understand application metrics and how the mobile app KPIs can be used to track and enhance applications will find this piece of content invaluable to aid their purpose.

Desirable User Growth Rates

As everyone knows, the two most popular platforms for mobile app downloads are the App Store and Google Play Store. As of the 3rd Quarter of 2020 data, the App Store has approximately 4.37 million applications available, with around 8.2 billion first-time app installs. This information showed a 2.5% growth rate compared to the 3rd Quarter of the previous year, which finished at 8 billion downloads.

On the other hand, Google Play presents about 2.9 million applications and generated almost 28.3 billion first-time app installs. This is a 31% increase in the average app user growth rate versus the 3rd Quarter of 2019, which saw 21.6 billion app downloads.

The data above clearly shows that despite Google Play having lesser apps than App Store, it still generated three times more first-time downloads. Meaning Google Play is growing at a much faster rate compared to its rival.

However, regarding the mobile app revenue, the App Store generated $19 billion from ad revenue while Google Play accumulated $10.3 billion.

App Metrics for Acquisition 

App Metrics for Acquisition

Cost per install and cost of acquiring a customer

After the app installation begins, companies tend to take it easy and relax and don’t bother calculating their mobile app conversion rates and its costs. They forget their Cost Per Install [CPI] and Cost of Acquiring a Customer entirely. At one point in time, the company will need to accurately account for all the monetary resources they have spent to get each of these installations. To put it simply, they need to calculate the average money the company has spent for every single download. Ideally, app owners should keep their CPI as low as possible and spend a consistently low amount acquiring app users. Because the moment the CPI goes over the app’s Customer Lifetime Value [CLTV], the company will start to lose money on every download and customer, which is not a good sign for the business. 

Formula to calculate CPI: 

Total Marketing Cost / Total Acquired Users

Supposing a business spends about $1,000 on offline and online marketing promotions and, as a result, gains 100 new users. The CPI for the company will be $10. 

Customer lifetime value

Once the customer has been acquired, the following crucial mobile app metrics that come into play will be to know the exact value they will generate for the company until they become an official customer. CLTV is concerned mainly with determining the amount of money the company can earn from average customers until they eventually uninstall the mobile application and cease to be a source of its revenue. The Customer Lifetime Value is the perfect indicator for companies to understand if they are spending more to acquire less, which is a massive red flag for a business. A company should never invest where it spends more than it earns. 

Formula to calculate CLTV: 

Average Value of Conversion X Average Number of Conversions over a time period X Average Customer Life Time.

For example, on average, the customers spend an amount of $50, 3 times per year in the company and stay two years before moving on. The CLTV of that business is [50 x 3 x 2] 300. 

The average revenue per user and average revenue per paying user

The Average Revenue Per User [ARPU] is a critical app performance metric. Companies need to understand the monthly revenue targets, whether they will manage to achieve them and what needs to be implemented to close these gaps. In simple words, ARPU is the amount of revenue the average user of the company generates. ARPU & CLTV might seem very similar, but ARPU provides revenue analytics by showing the users’ average revenue. At the same time, CLTV tells the average income the users will create. 

Formula to calculate ARPU:

Lifetime Revenue / No. of Lifetime Users.

$100,000 was the total revenue generated from 1,000 app users, which means the company ARPU becomes $100. 

ARPPU is a more precise calculation that allows companies to remove users that don’t generate revenue. 

Formula to calculate ARPPU:

Lifetime Revenue / No. of Paying Users.

The company has 100 app users and has a revenue of $100,000, but only 25 users contributed to it. Therefore, the ARPPY becomes $4000.

Engagement App Metrics

Engagement App Metrics

Daily active users and monthly active users

Arguably, DAU [Daily Active Users] and MAU [Monthly Active Users] metric values are the most important ones for an application, especially if it’s new to the digital market. These two app engagement metrics are critical when measuring user engagement to determine how the customers have received the application. Mobile app analytic metrics can significantly help businesses to measure their app engagement capabilities. 

In modern times, 28% of the applications tend to get removed within the first 30 days of their installation. Most commonly, this happens due to the mobile app failing to fulfill the customers’ requirements. The DAU and MAU metrics can quickly help companies determine how engaging and valuable the app has proved to be for the people who downloaded it. These insights allow the companies to take appropriate actions to introduce the necessary improvements to avoid losing daily users. The trajectory of DAU and MAU should always be in the upwards direction, and if it’s not, the application should be employed with engaging tools such as push notifications to bring back the users. Keep in mind that closely inspecting the DAU and MAU app engagement metrics can allow the individual or company to identify the day and time the maximum number of users are active. The calculation method of DAU and MAU is simple.

Formula to calculate DAU/MAU: Check how many users perform actions on the application daily/monthly basis. 

The company app has 50 active users daily and 600 active users monthly.

Rates of retention 

One of the key application usage metrics is the retention rate of the application. Not every single user of the company app will be active, but in the time of need, they might show up. Mobile app retention metrics are the number of users willing to revisit the mobile app after installation at least once within a specific time frame. It has been a popular practice of many companies to focus more on retention than acquisition [if the latter number of users is already good enough]. Retention efforts don’t cost any money to the company, unlike the expenses of sales and marketing attached with acquisition efforts. 

Formula to calculate Retention Rate: Number of users in a specific time frame – Number of users acquired during this period / Number of users at the start X 100. 

Supposing at the start of the month a company had 500 users and at the end of it, it had 250 left. Assuming the company had 100 new users this month, the retention rate will be 100/500 X 100 = 20%. 

Stickiness ratio 

The stickiness ratio is one of the most vital app engagement metrics available to app owners. It provides helpful information regarding how much value the app users derive from the company application. This calculation is usually done every month. The calculation considers both DAUs and MAUs, where a higher percentage indicates that more people find the application useful and regularly return to engage with it. The stickier the app, the more profitable it will be for the company. 

Formula to calculate Stickiness Ratio: Daily Active Users [DAUs] / Monthly Active Users [MAUs] X 100.

For example, a company has 1,000 daily users, while the monthly users total 8,000. The Stickiness Ratio, in this case, becomes 12.5%.

Average session length

Average session length is also one of the critical app engagement metrics that refers to the number of hours each user spends on the company application on average. This app metric isn’t universal because its applicability highly depends on the industry the application caters to. This app metric is still worth tracking because it provides an accurate idea of how valuable the users find the application, its content, and the ability to complete their tasks. Companies and app owners can use this metric to decide whether the app is doing fine or requires immediate updates to increase user engagement.  

Formula to calculate average session length:

The total duration of all the sessions in a specific time frame/number of sessions during that time frame. 

Suppose the company app had about 120 sessions in total for the month, of which 60 sessions were 20 and 60 sessions were 30 minutes long. In this case, the average session length would be 25 minutes.

Churn rate

The app churn rates are the opposite of the retention rates and help app owners to calculate the pace at which users are uninstalling the mobile application or canceling/downgrading subscriptions. The worst comes to pass when the app’s most top-revenue generating users churn, which adversely impacts the overall earning of the mobile application. A rising churn rate is always bad news for app owners. The increase could be due to the absence of new content, decreased usability, better rival applications, or too many app crashes. 

Formula to calculate churn rate:

App users at the beginning of the month – App users at the end of the month. 

If a company has 600 app users at the start of the month, and at its end, it has 450 users, its Churn Rate is 150. 

Exit rate

One of the most vital app engagement metrics is exit rate since it helps the app owners identify the exact app screen at which the users completely dropped off. If the company knows users are exiting the app at which screen the most, they then can quickly determine which app screen needs fixing. This could be due to the app users not receiving enough value from that specific app screen, or it might not meet their expectations.

Formula to calculate Exit Rate:

The total number of visits on a screen / Total number of Exits or Drop-offs from that specific screen. 

For example, the signup screen of the app receives a total of 50 visits, and of those 50 visits, 10 users exited or dropped off. The Exit Rate here would be 5.

App Metrics for Conversion

App Metrics for Conversion

Achieving company objectives 

One of the most crucial app metrics to track is goal completion when a company is reviewing conversions. This metric helps determine the conversion rates of mobile apps. It was popularized by Google and is used to track everything that explains and determines whether the users interacting with the company application derive value from it. The goal-setting process does not require a company to have any fixed settings, which allows them to be set according to customer behavior, attitude, and usage, everything relevant to the popularity of the brand and its application.

App owners can note down the application checkpoints at which most users decide to exit the app, goals that are most difficult to achieve, and completed goals that use up a lot of time. 

Goal completion time frame 

Companies and app owners, at times, tend to disregard this important app metric. Still, every successful company has made sure that every time they ran a promotional campaign for their app, they didn’t just monitor the number of users who fulfilled the set objectives! There are other essential aspects to consider that help identify the mobile app conversion rate. Knowing the number of people who were on the way to completing the goal but stopped halfway is just as important because this will help them determine the specific reason that stopped the users from completing the goal. Was it because of some design flaw? Or was it taking too long for the app to load? Or maybe the instructions were ambiguous or too complex to bother with, and the users about to complete the set goal became fed up and finally gave in. 

Companies that accurately monitor and record the Goal Completion Time Frame can seamlessly identify the root of the problem, allowing them to take appropriate actions. This app metric can tell app owners if the users are using too much time to complete the set tasks and goals. In this case, it becomes evident that the task completion process needs to be shortened and simpler to encourage more users to achieve the desired results. Other ways to do this are by using easy-to-understand language, clear instructions, and engaging designs that are user-friendly. 

Average of the total order value

The amount of cash that the customers spend on every order they place using the company application is the average order value or AOV, making it one of the most important mobile app analytical metrics. App owners who know their AOV can quickly assess their strategies regarding price and marketing. AOV is a type of metric that directly influences companies’ bottom line. Statista published that in 2019, users placed orders using applications that had a mean value of $77.71. Companies looking to cover up their user acquisition expense and increase revenues should focus on increasing their AOV. 

Formula to Calculate AOV:

Total Company Revenue / Number of Orders Placed

For example, a company sells t-shirts at $20, $40, and $70. The AOV for this firm is $43.33. In this case, the company should focus its campaigns to increases sales of their higher-priced shirts to increase profit margins. 

App Performance Metrics

App Performance Metrics

The loading time of the app

Nobody likes to wait—especially app users. When considering the mobile app performance, the app loading time plays a significant role. The time it takes to launch the app or jump from one app screen to another should be as minimum as possible. Otherwise, users will start to uninstall the company app even if it provides the best user experience. Every user wants their app experience to be seamless and smooth. Successful apps in the App Stores or Google Play all have one thing in common, the time they take to launch is 2 seconds or less. If the company application takes 3 seconds or longs, users will immediately uninstall it despite its design and high productivity. 

App owners will find their application to be vastly successful, reducing its launch time and the time it takes to load various app screens and process functions. 

Mobile application crashes

What could be worse than a long app load time? One of the main mobile app performance metrics that companies need to vary is app crashes; the application abruptly shuts down. Other than long app launching time, app crashes can have a far more negative impact on the app’s reputation and, therefore, are considered major issues. A user would be infuriated if they were in the middle of completing a lengthy, complex task and the application suddenly crashes, and now they have to start all over again! App owners need to consistently monitor the number of times their app crashes in a specific time frame, the number of app users influenced by it, and which app screen or function the application crashed on. 

There are many applications present in the various app stores, and users will always find a suitable substitute to replace the company application if it isn’t performing as it should. All top-performing businesses ensure that their mobile app has been designed, developed, and well-optimized so that no app screen or function causes it to shut down abruptly. 

Latency of the application

The time frame of the application creating a request and receiving the response in return from the application programming interface once the user initiates a function is one of the key metrics for mobile apps. Every company and app owner would want the latency of their application to be as low as possible since that satisfies the users the most. Although, achieving a latency score of 0 is still quite far into the future. The number of seconds the app users are willing to wait after pressing a button is about 1 second. Company applications that do not have a reaction time of 1 second or less will experience an increase in the uninstallation rate.

App Metrics: Vanity of the Application

Vanity of the Application

Mean number of screens a user visits

App metrics tracking is an activity every successful company executes. One of the more important mobile app metrics is Vanity Metrics. Many app owners tend to believe that it’s a good sign when the customers of their application are regularly visiting almost all its screens. Even if the users visit all the app screens but don’t buy anything, the application has achieved nothing of significance. Suppose the company isn’t tracking the amount of time the user spent on each screen. In that case, average screens per visit metrics will lose even more credibility when factoring in the possibility of the user simply rushing through the screens. Overall, this app metric doesn’t contribute anything significant to making the app’s overall experience and usability better. 

Amount of users who have registered

On Play Store or App Store, where the application information is being displayed, many app owners and companies show off the number of users registered in the app’s database. Still, none of them will ever show how many daily and monthly active users the application has. In reality, the number of registered users has no value; the app’s active users bring in the revenue. 

Let’s suppose a company’s application has achieved the goal of getting 60,000 registered users. What would be the point of that achievement if the daily active users are less than 10 and monthly active users less than 100?

Therefore, the number of registered users an application has is considered a vanity metric and one of the least helpful mobile app metrics since this information doesn’t provide any valuable insights that allow the application to be improved. High user acquisition rates are meaningless if the application fails to retain them. 

Number of app downloads

Just like the metric to view the number of users registered into the app, people will see another considerable number mentioned on the primary page of the application on the application store. App download metrics show the number of times the application has been downloaded and are considered to be one of the least helpful mobile app metrics. No useful information can be gained from knowing the number of times the company app has been downloaded. Even if it has 1 million downloads, but none of the users made any purchases, it won’t do the company any good. Therefore, companies cannot rely on the app download metric to determine the usability and popularity of their application. 

Mean daily sessions per daily active user

Regarding mobile app performance metrics, the Average Daily Sessions per DAU metric is no help in determining how valuable, helpful, and superior the users find the application. This metric tells them the number of times a user has launched the app daily, showing how well the users are engaged. It could, however, apply to a few market industries like social media and online business apps. 

Keep in mind that an app launched 10 times a day isn’t necessarily better than an app-only accessed once. The user could have very well decided to spend on the latter application even though the other app was engaged 10 times!

Receive Analytical App Insights Through Andromo

Valuable customer feedback

Who better provide feedback related to the app to improve its design, increase its usability, and boost its overall productivity than the users? Customer feedback is one of the most important types of data that allows accurate, precise, and immediate updates to be released for the company application, and Andromo understands this very well. The App Building Software, Andromo, has ensured that clients who create their applications through it are allowed the mobile app tracking of this metric, which allows the users to seamlessly pass on their remarks and feedback to the app owners. This information will empower them to take immediate actions and introduce the improvements required to increase the app’s user experience! 

User behavior & ROI

Another helpful feature that app owners can get their hands on through Andromo App Builder is the User Behavior metric, which allows them to observe the users’ attitudes and behavior towards the app. Positive behavior indicates that the users are happy and find value when engaging with the application and vice versa. Keeping the app users satisfied and ensuring the company application is constantly improved to provide a superior user experience to the customers is something Andromo specializes in.

Andromo has also introduced a function to monitor a mobile app metric that allows the app owners to check their ROI from time to time. We understand how important it is for company owners to keep an eye on the returns on their investments to plan out the future of their venture accordingly. When the app owners completely understand the rate at which they are receiving their return on the investment made, they can make better and more accurate decisions that will allow the application to yield better financial results.

To Conclude

After completing the design and development of the project and launching it, that doesn’t mean the work is done. The project owner must relentlessly monitor the relevant metric values to ensure that the project smoothly moves onto the next stage. The customers who are using it are satisfied and find it helpful. The same concept applies to a mobile application. Due to the fierce competition in the digital business world, users are very picky about the applications they want to use. Only those applications reach the top of the leaderboard whose owners closely monitor its acquisition, engagement, conversion metrics, and their valued users’ feedbacks; then, after analyzing and understanding it, they act on the valuable insights gained from them. 

Andromo empowers its users to create mobile applications integrated with advanced functions, plugins, and extensions, even those who don’t know a single line of coding! Once the application is designed, developed, and launched, Andromo provides the perfect platform to monitor the metrics of the live mobile application. This function allows the app owners always to be ready to make the necessary changes to prevent the users from uninstalling the app. 

Any company lacking the coding expertise but looking to create an aesthetic, fully operational, and highly useful mobile application after its launch to closely monitor the app metrics should visit Andromo and sign-up today!

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