User acquisition is the heartbeat of any successful app. Attracting users is the first step toward building a thriving community. But how do you know if your user acquisition strategies are working? That's where benchmarks come into play.
The competition among mobile apps for user attention has reached unprecedented levels. There are nearly 2 million apps available in the Apple App Store alone, but the average user has 80 apps installed on their phone (and only uses 10 of them on any given day.)
Mastering the art of user acquisition has become not just important, but absolutely crucial for app developers and marketers alike. With countless apps clamoring for space in app stores, knowing how to navigate user acquisition benchmarks is now a make-or-break factor for success.
In this article, we'll take a deep dive into the essential metrics and benchmarks that separate successful user acquisition strategies from the rest. Drawing from real-world examples and cutting-edge industry insights, we'll equip you with actionable strategies to not only keep up with but actually succeed in the demanding world of mobile app user acquisition.
Common questions about app monetization & benchmarks
What is mobile app user acquisition?
User acquisition refers to the process of attracting new users to download and install a mobile application. It encompasses various marketing strategies and tactics aimed at increasing app visibility, driving downloads, and encouraging user engagement.
What are the different types of mobile app user acquisition?
The different types of mobile app user acquisition encompass organic, paid, and viral strategies. Organic user acquisition occurs when users discover and install the app through unpaid channels like app store searches, word-of-mouth referrals, and organic social media shares. Paid user acquisition involves acquiring users through paid channels such as mobile advertising networks, social media advertising, influencer partnerships, and app store optimization (ASO). Viral user acquisition relies on viral or referral mechanisms within the app, including referral programs, social sharing features, and incentivized sharing, to attract and onboard new users. These varied approaches cater to different user acquisition goals and can be tailored to suit the app's target audience and marketing objectives.
What is the definition of benchmarks in mobile app user acquisition?
Benchmarks in mobile app user acquisition are standardized metrics or performance indicators used to evaluate the effectiveness of user acquisition efforts. These benchmarks act as reference points for assessing campaign success, comparing performance to industry standards, and pinpointing areas for improvement.
Why is benchmarking important for mobile app user acquisition?
Benchmarking is crucial for mobile app user acquisition because it offers invaluable insights into the effectiveness of marketing campaigns and enables the setting of realistic goals. By comparing their metrics against industry benchmarks, app developers and marketers gain a clear understanding of how well their user acquisition efforts are performing relative to their peers. This comparison allows them to identify areas for improvement and make informed decisions to optimize their strategies. Moreover, benchmarking helps in allocating resources effectively by prioritizing initiatives that have proven successful in similar contexts. It also facilitates ongoing monitoring of progress, enabling timely adjustments to campaigns as needed. Ultimately, benchmarking empowers app developers and marketers to maximize their return on investment (ROI) by refining their user acquisition tactics based on industry best practices and performance standards.
What are the key metrics for measuring mobile app user acquisition success?
The success of mobile app user acquisition is gauged through several key metrics. The Cost per Install (CPI) evaluates the efficiency of advertising campaigns, while Lifetime Value (LTV) indicates the revenue generated by users over time. The CPI:LTV ratio compares acquisition costs to user spending, offering insight into the sustainability of acquisition strategies. App Store Optimization (ASO) Metrics, such as app store ranking and conversion rate, play a vital role in enhancing app visibility and attracting users organically. Additionally, Retention Rate measures the percentage of users who continue using the app over time, reflecting its ability to retain interest.
Essential user acquisition benchmarks
User acquisition benchmarks encompass a range of metrics that provide valuable insights into the effectiveness of strategies. Let's explore some of the key benchmarks and their significance:
1. Cost per Install (CPI):
Cost per install is how much it costs to get someone to download your app. It's a metric that essentially shows how well your ad campaigns are working. The average CPI varies across different app categories. For example, gaming apps usually have higher CPIs than utility or productivity apps because the gaming market is highly competitive.
Example:
Let's say you make a gaming app for casual players. It might cost you between $1 and $3 to get one person to install your app. To stay within this cost range, you can improve your ads and who you target. Remember, the average cost can change depending on how competitive the market is, how well you target your ads, and how effective your ads are.
2. Lifetime Value (LTV):
Lifetime value measures how much money an average user generates over the time they use the app. It includes things like what they spend on in-app purchases, subscriptions, and ads. A good lifetime value is when the money earned from each customer during their time using the app is more than what it costs to get them to download the app in the first place.
Example:
Let's say there's a fitness app that charges users $20 per month for its premium subscription. On average, users stick around and keep using the app for about a year. So, for each user, the app makes $240 in total. This shows that each user brings in $240 in revenue, which should be way above what it costs to acquire that user to be profitable for the app.
3. Cost per Install to Lifetime Value Ratio:
The Cost per Install to Lifetime Value (CPI:LTV) ratio offers a unique perspective by comparing how much it costs to get a customer with how much that customer is worth over time. This metric is super helpful for evaluating the effectiveness and sustainability of your user acquisition strategies. By knowing this ratio, you can figure out if what you spend to get customers matches up with how much they bring in over time.
Example:
Let's say your ecommerce app spends $5,000 on getting new customers in a month, and you end up with 1,000 new customers. If each of those customers brings in $500 over their time with your app, you can find the CPI:LTV ratio by dividing the cost of getting each customer ($5,000) by the value they bring in ($500). This gives you a ratio of 10, meaning for every dollar spent on getting a customer, you're getting $10 back in value. It's good to aim for a CPI:LTV ratio of 3:1 or better to make sure your efforts in getting customers pay off in the long run.
4. App Store Optimization (ASO) Metrics:
App Store Optimization (ASO) Metrics include factors such as app store ranking, keyword rankings, and app store conversion rate. These metrics are crucial for enhancing app visibility, improving discoverability, and driving organic user acquisition through app store search and browsing. The App Store Conversion Rate, which shows how effective your app's store page is at turning visitors into downloads, is an important formula to remember to track the success of your ASO efforts.
Example:
Imagine you create a language learning app, but there are many similar apps in the app store. To stand out, you work on your ASO strategies and use the Conversion Rate formula to see how well it’s working. Generally, the rate at which people who visit your app's store page actually download it varies between 1% and 3%. This means that out of every 100 visitors to your app's page, around 1 to 3 people might end up downloading it. Based on AppTweak data from 2020, the average conversion rate from page views to installs was 33.7% for the US App Store and 26.4% for the Google Play Store.
5. Retention Rate:
Retention rate measures the percentage of users who continue to use the app over a specified period, typically 30, 60, or 90 days post-installation. A high retention rate means your app delivers value and retains users' interest over time. This is an important metric to track because it can help you understand if you're attracting the right users to install your app.
Example:
Let's say you have a fintech app with budgeting and financial features. If 60% of users are still using the app after 30 days, it means most users find it helpful and keep using it. Typically, a retention rate above 40% after 30 days is considered good for many apps, but this can vary depending on the category of the app, so it's important to research and benchmark accurately.
Best practices for using app user acquisition benchmarks
Tips for interpreting benchmark data accurately
When interpreting app user acquisition benchmarks, it's essential to consider factors such as app category, target audience, and regional differences. Benchmark data should be analyzed in context, taking into account industry trends, seasonal variations, and market dynamics. Additionally, focusing on relevant benchmarks for your app's specific goals and KPIs ensures accurate interpretation and actionable insights.
Strategies for implementing insights from benchmarks
To leverage insights from app user acquisition benchmarks effectively, prioritize data-driven decision-making and experimentation. Identify areas of improvement based on benchmark comparisons, and test different strategies to optimize performance. Continuous monitoring and iteration are key to refining user acquisition tactics, enhancing campaign effectiveness, and achieving sustainable growth.
Recent trends in app user acquisition strategies
Recent trends in app user acquisition strategies include increased focus on personalized messaging, immersive experiences, and multi-channel engagement. Marketers are leveraging AI and machine learning technologies to deliver targeted campaigns and optimize user journeys. Moreover, influencer marketing, social media advertising, and app store optimization (ASO) continue to be prominent channels for acquiring high-quality users.
The role of in-app social features for user acquisition
In-app social features play a vital role in user acquisition by fostering community engagement, virality, and user-generated content. These features create an environment where users feel connected, valued, and motivated to share their experiences with friends. Word-of-mouth marketing becomes powerful as satisfied users recommend the app to their social circles, amplifying its reach and influence. The significance of recommendations from friends is huge, as they’re often perceived as more trustworthy and credible than traditional advertising.
What we’re trying to say is: When users love your app, they’ll want to tell their friends about it. And when they share their positive experiences with friends, it spreads the word faster than any ad. Organic recommendations from friends carry a lot of weight and can persuade others to give the app a try. So, in-app social features aren't just nice to have—they're essential for growing your user base.
Benchmarking: elevating user acquisition beyond downloads
In the fast-paced world of mobile app development, attracting new users is vital for success. With countless apps available, developers need effective strategies to capture and maintain users' interest. By monitoring key metrics like Cost per Install (CPI), Lifetime Value (LTV), and Retention Rate, developers can adjust their strategies for steady growth.
User acquisition goes beyond simply getting downloads—it's about generating excitement that leads to users sharing and recommending the app. By staying informed about industry trends and using data to inform decisions, savvy developers can optimize their user acquisition efforts and thrive in a competitive market.
Read more: Top mobile app User Acquisition Statistics