Insights


10 Essential Mobile App KPIs and Engagement Metrics (and How to Use Them)

Team Braze By Team Braze Mar 9, 2016

Customer engagement is built on data. But while customer data gets most of the press—see all the back and forth about first- vs. third-party data—it’s just as important for marketers to have a handle on a different kind of data: Metrics, benchmarks, and key performance indicators (KPIs). This information makes it possible to get a handle on what customer engagement campaigns and programs are performing and which should be reimagined, but while there’s many different angles to examine engagement and performance from, they’re not all created equally.

For marketers attempting to gauge the success of the relationship with their app users, it’s all about quantifying engagement. How best to determine what’s working and what’s not? Here are 10 key metrics formulas and mobile app KPIs that will help you measure the impact of the hard work you put in to develop your audience.

1. Retention Rate

Retention is perhaps the most important KPI for mobile marketers; after all, users can’t engage with your app if they’re not using it anymore. Understanding if and when churn is happening is the first step to reducing it, and keeping more of your audience coming back.

There are a number of different ways to define retention—but for our purposes, we’ll look at range retention, which compares the number of users from a previous week, month, or other date range against the next equivalent date range, allowing you to see how many users have been retained. Calculating range retention, therefore, is simply a matter of dividing the number of users from a recent time frame (say, the past month) by the number of users from a previous time frame (say, the month prior to that).

2. Churn Rate

While retention rate gives you a picture of how many of your customers you’re keeping around, your churn rate measures the side of the equation—namely, how many app users are departing in a given period. Accordingly, calculating your churn is simple: All you have to do is subtract your retention rate from one, like so:

3. Monthly Active Users (MAUs)

For most apps, understanding how many monthly active users (MAU) you have is a great way to get a general sense of what your engaged audience looks like. This metric counts someone as a MAU if they log an app session either in a particular month or for a specific 30-day period that can be defined as a month, depending on how your company measures things. While you should think of MAU as a directional signal—since, of course, a customer can fail to use your app for a month and still come back—staying on top of whether your MAU count is rising or falling can give you a high-level sense of whether your customer acquisition and retention efforts are bearing fruit.

4. Daily Active Users (DAUs)

For some brands, while knowing how many people use their app each month is interesting, knowing how many people engage each day gives them a window into how many highly-engaged customers they have. After all, users downloading and keeping your app is one thing, but your engagement efforts are going to bear more fruit if your audience is actively making use of it on a regular basis.

Because this refers to each individual person using your app, not to the number of sessions, each person is counted just one time, regardless of if they use the app once per day or hundreds of times per day. Another thing to keep in mind? DAU can be calculated for a specific day (say, yesterday’s DAU), or averaged over a timeframe.

5. Daily Sessions Per Daily Active User

Once you’ve got a picture of how many people are engaging with your app per day, it’s possible to drill down even further to see what that daily engagement really looks like. By examining how many times a day an app is being accessed by users, brands get a more nuanced view of their audience’s daily engagement; that's important because, for most apps, at least a couple of sessions a day is a desirable level of user activity.

To calculate daily sessions per DAU, brands need to track both the number of total sessions and the number of daily active users, and then divide the former by the latter.

6. Stickiness

Daily sessions per DAU provides a micro-level look at repeat user activity, but stickiness expands that picture further by incorporating a more monthly perspective. By dividing DAU by MAU, you get stickiness; that is, a metric that tells you how engaged—and likely to return—your audience is. The closer MAU And DAU are to each other, the more effectively your app is at bringing users back over and over again.

7. Average Session Length

Session length is a pretty straightforward KPI. It measures how much time, on average, users are spending on your app in each session. Put a different way, it’s how long the app is open in front of each user. You can calculate this metric by dividing the total amount of time spent in your app by the total number of users who logged sessions in a given time period, in order to get a better understanding of whether users are usually engaging for 10 quick seconds or lingering in your app for minutes on end.

8. Cost Per Acquisition (CPA)

Running campaigns to acquire new app users requires monetary investment, and when it comes time for accounting, it’s helpful to know just how much is being spent on each audience member that you acquire. Cost per acquisition (CPA) provides this clarity by dividing the costs associated with a given campaign by the number of acquisitions that took place during its run, allowing you to compare the relative impact of different campaigns and activations and helping your company to manage your marketing spend in thoughtful ways.

9. Customer Lifetime Value (LTV)

Convincing users to download and open an app is only half the battle. Typically, there will be a next step in that process that leads to value or revenue generation for your organization—whether that’s when a customer signs up for a subscription or makes a purchase. Customer lifetime value (LTV) helps decipher this aspect of the brand-customer relationship by taking a look at how much value can be generated from the average user over the course of their time spent as a customer. The greater it is in relation to CPA, the bigger bang you’re getting for your acquisition buck. To determine LTV, we take the total user spend in dollars associated with your app and divide it by the total number of buyers to date.

10. Return on Investment

This is kind of the holy grail of mobile marketing KPIs. Knowing how much value is generated by a campaign compared to how much was spent on it can be a key and critical tool in determining future strategy. Unfortunately, sussing it out can be a bit tricky due to the cloudiness of the variables involved. For example, you can look at the revenue generated by conversions through a particular campaign, but there may be factors affecting why that happened that have nothing to do with the campaign itself.

Still, it’s possible to calculate return on investment (ROI) as long as there’s internal alignment on what’s being valued as return (profit, net revenue, etc.) and what the investment costs of the campaign were.

Final Thoughts

There’s no one foolproof method to spin data into campaign success, or else the marketer’s job would simply be to make sure a few boxes get ticked in the right order and then sit back and watch the conversions roll in. That said, the KPIs above can help to paint a clearer picture of just how well your mobile marketing efforts are going and where you might want to focus your efforts to drive future improvements.

For more on the key determinants in successful user engagement, check out the Braze Benchmark and Metrics Guide.


Team Braze

Team Braze

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