Top 12 Key Performance Indicators for Maximizing Mobile App Revenue

What Key Performance Indicators (KPIs) should marketers look for in order to gauge performance on mobile?

Though many mobile marketers still focus on getting their app installed – which is certainly more of a challenge than it was in the much less crowded app stores many years ago – the install is only the beginning of the mobile customer journey, even for the small percentage of paid apps.

Mobile customer engagement is the future of marketing, and the app install is the opening sprint of this marathon.

So what Key Performance Indicators (KPIs) should marketers look for in order to gauge performance on mobile?

Though there is no ‘one size fits all’ solution for mobile marketers, after more than a decade in mobile marketing, here are my top 12 KPIs for bringing users through the funnel.

Engagement Metrics – The first three metrics focus on how engaged your customers are with your app.

1. Number of times the mobile app was accessed during the first 24 hours / first week (after installation): Though the app install is the sprint, what the user does in the first 24 hours and even in the first week after installation provides a strong predictor of their future usage. If the user doesn’t access the app during the first week, chances are they won’t do so ever again. Therefore, it’s critical that marketers provide stimuli during the critical first week in order to solidify the relationship with the user immediately after the installation.

2. Session time (time spent in-app): In addition to the frequency of visits, another important KPI is the length of time spent in-app, which shows how engaging the content is. Session time is an especially critical KPI in games and media applications.

3. Permission granted to the app: A surprising yet important engagement-based KPI is when users grant permission for the app to access personal information. This information can include location information (which enables recommending a store nearby) or to share information to the user’s contact list. This KPI is important because it signifies a bond of trust between the user and the app which isn’t inherently given to every app.

4. Number of screens/pages accessed during in-app visit: Another important engagement metric is the number of screens/pages visited, which, like session times, shows how captivated the user is with the mobile content/experience. A news/magazine app or even a shopping app will use the number of screens/pages accessed as a KPI.

For example, for a retail application, we saw that page views (and not sales or placed items in shopping carts) was the KPI which provided the best indication to lifetime customer value. This example proves the importance of broadening the pool of KPIs considered and continuously analyzing all of your KPIs to ensure that you understand the correlation between the KPIs and your actual business performance.

Revenue Metrics – The first three KPIs focus on engagement, and the next three on revenue generation. Some of the most successful applications, like Facebook and Twitter, spent years focusing exclusively on engagement metrics. Each mobile marketer must decide when and how to make the transition from engagement to revenue and there is no one right answer for when or even how it should be done.

5. Number of subscriptions / registrations: Many applications rely on a subscription model, like magazines, in order to generate a stream of revenue. By asking for a smaller sum of money on a continuous basis, many applications are able to generate significant revenue with this very scalable business model.

6. Purchases (bookings / in-app purchases within a given time period): Though the in-app purchase is the holy grail of mobile marketing, the ultimate goal is to maximize lifetime customer value. So the objective isn’t only to make that first sale but to generate a continuous stream of revenue from your best customers. Therefore purchase KPI is one that needs to be reviewed on a continuous basis and even segmented according to recency / time.

7. Number of items placed in a shopping cart: Though all marketers strive for revenue-generating purchases, just placing items in a mobile shopping cart is an important KPI because it is a strong indicator of user intent. As mobile commerce is a newer experience for shoppers, user experience engineers need to study this KPI closely to ensure that sales aren’t being lost to a poor / unclear checkout process.

Interest / Intent Metrics – For media applications, there are a number of engagement KPIs which are important indicators of user interest / intent, including:

8. Number of articles read: When a visitor reads multiple articles, it’s an indication of interest in the content that has been presented / recommended. That’s why the number of articles read is an important KPI for media applications.

9. Number of pages visited: Along with the number of articles read, the number of pages visited is a second important KPI for media applications because it proves that the visitor was able to find engaging content which kept them in the app.

10. Social shares: As significant as articles read and pages visited are as KPIs, social shares are a vote of confidence from visitors in the content they’re reading which they want to share with their friends and followers. Social sharing is such an important KPI in publishing that some publications make editorial decisions and even compensate their writers based on the social shares of a piece of content.

11. Retention rate: In the same way that a repeat customer is the sign of success in retail, retention rate is an important KPI because it is an indication of how many visitors have chosen to return and make additional purchases or re-engage with your content. Retention rate is a particularly critical KPI for applications with a subscription business model.

12. Brand Awareness: For a launching consumer application, brand awareness is a frequently used KPI which enables marketers to understand how well known their brand is in the local media market. Taken from the play book of leading consumer packaged goods manufacturers, app marketers today run phone or online surveys during their launch periods to gauge brand awareness.

Once an application has been established, brand awareness becomes a less relevant KPI (as the brand already enjoys high levels of awareness, and incremental gains in awareness are not significant).

Though each mobile business will have its own KPIs, we’ve found that the aforementioned KPIs will enable decision makers to understand what’s happing with their business and to optimize accordingly.

Eyal Hilzenrat is the vice president of products and partnerships at YouAppi, a pioneer in data-driven mobile customer acquisition.

Image courtesy of Shutterstock.