Product Manager, Reteno
October 1, 2022
Engagement metrics show whether your efforts align with your audience’s needs and interests. They allow marketers and business owners to see the bigger picture, which ultimately helps them prioritize effectively, set better goals, and improve their apps.
But you don’t need to track all metrics for a big-picture perspective. To save time and resources, you can focus on essential metrics, which we’ll talk about in this article.
App engagement metrics help you find the answers you seek about your product. Should you invest more in expanding your user base by acquiring new users or in creating better relationships with your existing users? What’s more important for you: acquisition or retention? Do people continue to choose/repurchase? Does the app offer them value?
Engagement KPIs help you to:
Figures, graphs, and dashboards are key to unlocking valuable information about your app and the users it serves. Of course, the insights aren’t drawn from raw data. Metrics are of little value to a business until they’re turned into information. Find someone internally or externally who will analyze and translate them into answers to business questions.
Together, tracking and analysis will help you make better decisions about the next step for your application.
Here is how to measure engagement in a way that doesn’t stretch your team to the limit. Be alert to these metrics:
NPS determines the likeliness of your customers spreading the word about your app.
The most common way to collect data for NPS is through surveys (in-app, email, etc.). Ask something along the lines of: “How likely are you to recommend this product/brand to a friend or colleague on a scale of 0 to 10?”
Then, you should categorize respondents according to the score they gave you:
CAC helps you determine the cost of earning a new customer. In the formula above, we’ve included two categories of costs, but you can add more categories or segment these two further - salaries, commissions, bonuses, overhead, etc.
Ideally, you want to not just recoup but reduce your CAC. If you manage to do so, it’s a sign that your sales, marketing, and customer service programs are working well.
CSAT measures customers’ happiness with a product, service, or support interaction. It helps you figure out whether most users are satisfied with your app or a specific interaction that happened through the app. If not, it emphasizes the issues to fix.
Similar to NPS, ask users a simple question, such as “How satisfied were you with your purchase/experience?”. Determine the rating that will qualify “happy customers” and follow the formula.
CES helps you understand how many unhealthy and disengaged users you have. Before declining user engagement turns into the churn, you can address whatever makes users averse to the app.
This metric also points out how many engaged customers you have for a certain event. These can be trial accounts ready to convert, leads with the biggest sales opportunities, and existing customers willing to pay more.
The formula is open to modifications so that you can decide on your own inputs for specific actions taken.
Churn measures how many users have stopped using your app, with the churn rate recording the percentage of such users. Obviously, most apps aim for a churn rate that is as close to 0 as possible, especially if the customers pay on a recurring basis. But some customers won’t stick around for long, and this is normal.
Most companies track churn for several time periods - monthly, quarterly, and annual. If you experience a high churn rate over a certain period, look back at the events that took place at the time.
CLV indicates how much revenue a company can reasonably expect from a single customer. There are two models for measuring CLV:
Bear in mind that most customer journeys are not identical, nor are their lifetime values. It helps to establish an average baseline and track future trends against it.
Stickiness determines the tendency to gain repeat business. The more customers are “sticking” to your app, the better.
Based on this metric - whether it’s high or low - you can understand the app’s perceived value. If you analyze it in combination with other metrics, you can see what contributes to stickiness - the app quality, convenience, user experience, or something else.
Visit frequency determines the number of visits over a certain period. Because it only focuses on unique users, the data doesn’t tell you much about different users.
You can you another metric for this - return frequency. It helps you assess the number of new app users and the familiarity level of all returning users. For example, you can see how many of the users are highly familiar with the app (those who visited the app more than ten times) versus how many are relatively new.
Session length measures how much time a user spends on your application in a single session. If a user exits the app and comes back later, it will be counted as a start of a new session.
Longer session duration typically means higher engagement, but the preferred session length will vary from business category to category. For example, a food delivery app should have short sessions, even though it means users will be less engaged in the app.
Conversion rate measures how many visits or impressions it takes before an app user completes a desired goal. It can be a sign-up, a purchase, or another action.
You can further divide it into:
You’ll see that first-time visitors interact with your app differently than returning visitors or loyal customers.
The average screens per visit metric shows how many screens a user goes through before they exit the app. The higher the number of screens a user sees, the higher their engagement level on the app.
This is more of a vanity metric because if a user visits ten screens but doesn’t make a purchase, it has no effect on the bottom line. But an app serves other purposes (not only sales), so you may still benefit from users visiting many screens.
The bounce rate tracks how many users looked at one app screen during a session. Even if a user scrolled the screen, tapped through images, or read content, it will technically count as a bounce because they never visited a second screen.
Depending on how your app is built, the bounce rate metric will be more or less relevant. But if you have a high bounce rate and low average screen time, it’s a bad sign.
While the bounce rate focuses on users who don’t engage with the app, the exit rate tracks screens from where users usually make an exit.
The app should be built and function in a way that allows you to predict common exit pages. An order confirmation screen will have a high exit rate. But you don’t want a specific product page to have a high exit rate.
The feature usage and adoption rate measures how many users interact with a specific feature of the app.
If the adoption rate is low, the feature may be faulty or useless, or you may be targeting the wrong type of user. If usage is low, the feature works well but brings little value to users. If it becomes a high-exit page or if visit frequency takes a dip, consider removing the feature.
While social media engagement doesn’t directly determine the level of app engagement, social media metrics give you a sense of how your product is performing online.
The most important metrics in this category are:
We want to warn you once again: you don’t need to measure everything. There is no reason to track irrelevant KPIs, which will only distract you from what actually matters. Don’t stress about the numbers that have no significant impact on your app’s growth. Prioritize these instead:
To turn user data into actionable recommendations, use our customer engagement analytics and reporting services at Reteno. We know how to grow customer retention and are happy to share our expertise with you.
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