What's the Best KPI for Mobile App Growth?
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There’s an even better KPI to track for measuring growth than conversion rate. We’ll give you that unique KPI, explain what app conversion rates are, show you industry benchmarks, and explain why these rates aren’t good enough on their own to predict your app’s revenue and growth. - https://clevertap.com/blog/best-conversion-rate-for-mobile-app-downloads/
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What's the Best KPI for Mobile App Growth?
- 1. What’s the Best KPI for Mobile App Growth? And is conversion rate a good KPI to use?
- 2. Traditionally… Mobile app conversion rates are a standard metric brands use to measure growth. Conversion rate: the percentage of users who undertake a specific action on your app that fulfills a desired business objective, e.g., new users making a first-time purchase.
- 3. But there’s a better KPI And it’s called CAC-to-conversion Rate. CAC (customer acquisition cost) is the amount you spend to acquire a new customer.
- 4. You get 3 distinct phases: User installs your app User gives you email, name, social login User makes a purchase or subscribes CAC-to-register CAC-to-conversion Subscribe Purchase CAC-to-install When you break down CAC into phases...
- 5. And each CAC phase has a cost. Here are typical acquisition costs for B2C companies. CAC-to-registerCAC-to-install $1 - 5 $5 - 30 CAC-to-conversion Purchase Subscribe $100+ $30-100
- 6. CAC-to-install $1 - 5It costs $1-5 to acquire each user who installs the app. This range exists because of differences in verticals. E.g., ecommerce apps are more competitive and cost more to advertise, so you pay more to acquire users. This metric is largely out of your control as it’s set by the marketplace. Let’s go through each phase
- 7. CAC-to-register $5-30 It costs $5 - 30 to acquire each user who then registers, which means giving you their email, name, or social login. Only a small percentage of your installed users go on to register. But they do so only once in their customer lifetime.
- 8. For simplicity’s sake, we group Purchase and Subscribe under one umbrella, the CAC-to-conversion. Again, only a small percentage of those who register actually convert and give you their money. This is the KPI that you should be tracking for growth. CAC-to-conversion Purchase Subscribe $100+ $30-100
- 9. Conversion is ongoing Why the last phase is the best CAC-to-install CAC-to-register CAC-to-conversion SubscribePurchase
- 10. Why bother with CAC-to-conversion? Conversion rates are lackluster if you use them alone. Instead, support them with the CAC-to-conversion rate. Here’s why: Growth depends on acquiring the right type of customers. CAC better measures how much it costs to acquire a new paying customer. CAC-to-conversion is a metric that you can directly improve. By lowering this rate, you get better ROI. Conversion is ongoing. You can upsell, cross-sell, and encourage users to make repeat purchases or renew subscriptions.
- 11. Learn More About CAC-To-Conversion https://clevertap.com/blog/best-conversion-rate-for-mobile-app-downloads/ Convert, Retain, And Grow Your Mobile Users www.clevertap.com