If you aren’t calculating your app conversion rate, you should get started now. This article will explain exactly what this metric is, how to calculate it, and how to improve it.
What is the conversion rate?
Your marketing plan plays a key role in attaining your goals, which could include:
- Acquiring more users;
- Increasing revenue;
- Establishing your brand,
- Retaining users.
Your marketing strategies are intended to reach your target market and encourage them to take actions that align with your goals. The app conversion rate reveals the percentage of users who took those actions when given the opportunity.
Here are the rates you should be tracking:
- New User Conversion Rate;
- Returning User Conversion Rate,
- Cost Per Conversion.
App conversion metrics to track
Now we are going to look more closely at each of the rates listed below.
New user app conversion rate
This rate deals specifically with new users and can be found with the following formula:
(Conversions/Total Clicks) X 100 = New User Conversion Rate
This rate reveals the percentage of users who downloaded your app after clicking on your ad. Remember, clicks are not conversions. Only users who follow the ad’s call to action are included in the percentage.
Returning user app conversion rate
Once you gain new users, you need to keep them. At this point, a new user has already been converted once. The next goal is to keep the user engaged with your app.
This could mean:
- Getting the user to make in-app purchases;
- Convincing the user to upgrade to a paid version of your app,
- Getting the user to use your app for a certain amount of time each day.
Whatever the goal is, you must keep users returning to your app so that they can carry out the desired actions. Keep track of returning users with the following formula:
(Conversions/Total Users) X 100 = Returning User Conversion Rate
Cost per app conversion
In order to make a profit, you need to manage conversion costs so they aren’t higher than the revenue generated by conversions. After all, the goal of converting users is to make a profit.
First, determine every cost that is associated with each conversion. Be sure to include all of those expenses in the cost per conversion formula.
Here is the formula:
(Total Sales Funnel Expense + Total Ad Expense)/Total Conversions = Cost Per Conversion
Tips for improving your app conversion rate
If your conversion rate is suffering, don’t worry. You can work on improving it. Here are some pointers:
- Maybe you are having trouble convincing new users to download your app. If so, try to figure out what is chasing users away;
- You might need to change your marketing message, images, ad placement… This will require experimenting with various strategies until you find what works best;
- When coming up with a persuasive marketing message, think about what would cause you to download a new app. Try to incorporate that into your message;
- In general, perfecting your sales funnel requires putting yourself in the user’s shoes. Is there anything frustrating or confusing about your sales funnel? Are there any useless steps? Get rid of anything that might hinder users from going through the funnel,
- If there is a particular part of your funnel that has a significant drop-off, that is likely to be the source of your trouble. Take a closer look to determine what’s going wrong.
Once you’ve realized how important the app conversion rate is, you will be eager to calculate it. After the initial calculation, don’t forget to keep monitoring this metric.
If you want to learn more about how to make your app a success, check out our other articles at AppRankCorner.