What Are Important Mobile App Metrics and How to Calculate Them?
You published your mobile app and what’s next? Well, of course, measurements. You didn’t create a mobile app just to say that you have it, but to be useful for your business. The best way to see the difference between costs and revenue that your app brought you is by calculating different metrics. I’ll explain to you just some of them and give you formulas that you can use to calculate successfulness of your app.
1. Number of downloads
A number of downloads are a strong measure that shows how many users engaged with your app. Each time when a user installs your app in a new device it’s counted as a new download.
But how to count which number of downloads is necessary for you to have a revenue?
This really depends on your revenue goals. Some approximate measure would have to include your aiming per month divided by the price of your in-app purchase (we’ll mark this as a). Next thing that you’ll need is an estimation of the users that will encounter the conversion lever expressed as a number (ie. 10% = 0.10). We’ll call this b. The third thing that you’ll need is a percentage of users who’ll actually proceed to purchase and express it in a number. If you have some data from before using them, if not let’s count this at 5% and mark it with c.
Here’s the formula that’ll help you to reach your target:
Required downloads per month: a * (1/b) * (1/c)
2. Daily active users (DAU) & monthly active users (MAU)
Once you know how many downloads you have you should know how many active users you have on a daily and monthly level. Fact that someone installed your app doesn’t mean that they’ll use it. This metric counts how many people use your app, it’s not connected with daily active sessions but with real people who use your app daily/monthly.
DAU = number of individual users who open your app in a day
MAU = number of individual users who open your app in a month
Apps that have over 20% DAU and MAU are considered good, while those over 50% are considered exceptional.
3. Daily sessions per DAU
Daily sessions are showing you how many times users open your app within a day. This can help you to see if your users are returning to your app as often as you’d like that. Social networks, for example, like to see that their users are opening the app a couple times per day.
No. of sessions in a day (or daily sessions averaged over timeframe) / No. of unique active users in a day (or DAU averaged over a time frame) = DAU
Stickiness is showing how many people are returning to your app. To get this number to divide DAU with MAU. The higher percentage the more users return to your app and their engagement to you is bigger.
DAU/MAU = stickiness rate
10000 active daily users / 5000 active monthly users = 50%
5. Retention Rate
This metrics is showing you how much customers are you retaining to stay with your app. Numbers that you’ll put in a formula depends on what you’re looking to measure but what you’re comparing is a number of users in a recent time frame (this month for example) with the same users in an earlier time frame (ie. last month).
No. of people who use your app within a set period of time / No. of people who used your app within a previously set time
6. Churn rate
This is a metric that shows the opposite of retention rate. This metric shows how many users left your app. It’s a major problem for you if most of your users belong to this group. Your most active users are the most profitable one. You count churn rate by subtracting your retention rate from 1.
1 — retention rate = churn rate
1- 0.20 = 80% churn rate
7. Number of crashes
A number of crashes show how many times your app closes abruptly while your users are using it. They are the result of a problem with app performance. This number should be taken to a minimum and in order to be so, you should have a lot of testing during the development period to prevent it. A higher number of crashes can result in higher churn rate, among others.
Here’s how to count it:
(Number of instances when the crash happened) / (Total number of instances)*100
8. Ranking and rating in the Apple App Store and Google Play Store
App rating is the easiest and quickest way to see what users think about your app. This can attract more users or prevent them from downloading your app. Users usually check app rating prior to downloading it, so make sure that your app has a good rating.
Your app ranking shows how visible your app is in Store. Since most users download apps while searching inside of the Store, algorithms put in the higher position those apps that have a better ranking, making them more visible to users. Here is how the App Store count ranking.
9.Cost Per Acquisition (CPA)
This metric measure how much you have to pay to get an active, paying user. These costs can include marketing cost, hosting or salaries.
You’ll need to adjust your CPA depending on your revenue goals. You will probably want to keep your acquisition cost below your app’s price tag.
The total cost of campaign/number of users = cost per acquisition
10. Return on investment (ROI)
Everyone wants to calculate ROI for their overall mobile marketing efforts but that is not such an easy task. You’ll first need to calculate the cost of a campaign and how it affected your profit. You’ll have to decide on what measure of return you want to focus (ie. net profit, gross profit).
(gain from investment — cost of investment) / cost of investment = ROI
These are some of the metrics that you should follow to measure your app performance and how it affected your business. In my next article, I’ll show you how to improve these metrics and how to get the most from your mobile app.