3 Proven Ways to Better Measure Your User Acquisition Campaigns

5 min read · 7 years ago



How would you grow an app? Would you put ads up on Facebook, start a Google adWords account, or write a blog about it? How would you measure the success of each campaign?

Do you even know where to begin?

Dont worry if you don’t; many apps struggle with a growth strategy throughout their lifetime. They struggle mainly because there is no one way to go about it. With many possible approaches, app owners are left blind to what really matters in their growth strategy, sustainability. In the digital world, these approaches are called acquisition channels, and they are critical to sustaining an app. Determining which channels to use and when will be your challenge going forward as the app marketer.

The main thing to focus on when choosing an acquisition channel is maintaining a high ROI. This simply means getting back as much value as possible for the money that you spend. And although this is a simple concept, it is actually quite difficult to measure. For me, the easiest way to conceptualize ROI is to reverse the letters and use a process called IOR; Invest, Observe, Rebuild, for each channel. Following this process for each channel will allow you to see where you are receiving the highest ROI, and where you should focus your efforts in the future.



We all know the saying: “You need to spend money to make money.” This remains true when acquiring new users for a mobile app. You simply must invest capital into marketing resources in order to expand your reach. If you do, there will be a new sample size of completely random users that you can test product features on. Investing in ad acquisition campaigns also enhances your likelihood to acquire users organically. It puts your name out there so that even if you don’t get downloads, people will know who you are and what you can do for them. Unfortunately this effect can be difficult to measure, but luckily there are other ways to gauge the success of an acquisition channel.


Once you invest money into an acquisition campaign, the first metric to pay attention to is the amount of new users that download your app. This should give you a general idea of how effective that channel is at bringing in new users. Compare this to counting the number of people who enter a brick and mortar retail store: yes, it is an achievement to get people to look around your store, but if they end up leaving empty handed, do they actually provide you any value?

No, of course not – they are just wasted spend, a concept that translates directly to app user acquisition. If you get a user to download an app and then he never uses it again, that has a negative effect on your business. And since almost 20% of all apps are opened just once, there is a large risk that your investment money will be spent on unqualified users who don’t generate revenue. To fix this, you need to focus on getting users to the retention phase before you start measuring the success of your acquisition. In the retention phase, you can begin to analyze how they use your app and what value they can bring to you in the future.

Retention is the bridge between turning a download into a new customer. It is the stage of acquisition where you need to observe user engagement and start to segment the channels further based on which metrics matter to your business. The main area that you want to focus on are the session statistics for each user. You are going to want to understand:

  • How many sessions a user starts
  • How long each session lasts
  • How frequently a user returns to your app
  • Whether or not that user was organic or came through a paid channel

If you trace these statistics back to their acquisition channel you should know which sources deliver retainable customers. Companies like TaxiForSure are already using these metrics to do so today. They are a transportation app that competes directly with Uber and Lyft, so clearly acquiring qualified users is a focus of their business. In order to do this, TaxiForSure seeks a “clear understanding of their app usage and conversion rates to determine ROI of their promotional efforts” (Satej Sirur, TaxiForSure). Retention is an important metric when measuring ROI, and the most important for fueling it. Without a focus on retention, ROI will certainly go down the tubes and leave you with very little value to continue to build the app on.



The final and most important step of measuring ROI for acquisition campaigns is to understand a user’s lifetime value (LTV). Lifetime value is a metric that represents a user’s likelihood to engage, spend money, or do anything else that provides value within the time that they own the app. If you find a concentration of users with a high LTV, you must recognize them as your power users and learn as much as possible about them. Learn how they use your app, what good or services they purchase, and most importantly how they were acquired in the first place. If you understand these qualities, then you will be able to trace the LTV of users back to their original acquisition source. It will enable you to effectively decide which ad networks, channels, and copy work best at acquiring users with a high ROI. So focus on users with a high LTV and make sure that you keep track of where they are coming from! Knowing which channel delivers the highest value per user is the best way to measure the effectiveness of a campaign.

Measuring ROI for acquisition channels is really about understanding how to send users down the acquisition funnel. You as the app marketer need to know where to acquire high quality downloads, how to engage them regularly, and how to increase their lifetime value for your app. If you can learn to work this funnel effectively then you should be able to easily decide which channel is best for your company. The channel you choose should complement this funnel and deliver the best chances for success. So choose wisely!


This article was syndicated from Business 2 Community: 3 Proven Ways to Better Measure Your User Acquisition Campaigns

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