Brands are missing out on opportunities to convert their users to paying users because of the way they are measuring the performance of their apps.
The study, from AppsFlyer, reveals marketers are missing opportunities to convert users to paying customers.
On average, the share of paying users is lower than 10% based on app install-to-purchase ratio (a mere 3-5% in gaming apps and double that rate in non-gaming apps).
Key findings:
- Derived from 12,000 apps with a user base of over 2.3 billion users, the report is the first to ever report the number of in-app events being measured and how this is impacting marketers’ bottom lines across the world.
- Chief among its observations, the report finds brands are only measuring a fraction of their apps’ performance, creating blind spots. On average, marketers are measuring between 4-7 events per app, depending on the vertical, but performance based on the share of paying users hits its peak when this number is 16-20 events, or 26-30 in the gaming space.
- The impact is huge: in Shopping apps 1 in 4 carts convert, only 1 in 5 users in Entertainment apps who registered for the app go on to subscribe, and only 1 in 5 registered users of Health and Fitness apps go on to make a purchase.
In a space dominated by free-to-install apps, where actual value is tied to post-install in-app activity and share of paying users, the study by AppsFlyer examined over 12,000 apps with a user base of over 2.3 billion users. Findings determine the importance of granular in-app event measurement, and provide insights to improve campaign effectiveness and increase the percentage of app installs that lead to a purchase.
The rate of paying users is lower when marketers don’t measure, and therefore optimize for, enough in-app events. On average, the report found that marketers are measuring only 4-7 events per app, depending on the vertical, but performance based on the share of paying users is much higher, hitting its peak at 16-20 events, or 26-30 in the gaming space.
Shani Rosenfelder, Head of Mobile Insights at AppsFlyer, comments: “Although performance app marketers have shifted their efforts from focusing on driving installs to post-install measurement, most are still measuring only a fraction of the in-app activity they could be. Converting more users to paying users and maximizing their revenue potential requires measuring events that span the full conversion cycle and all significant milestones in the consumer journey, allowing marketers to identify gaps and optimize accordingly. The insights that can be drawn from this data are vast and can help maximize user lifetime value by informing smarter acquisition and re-engagement decisions.”
In-app events ignored
In-app events contain specific information about actions taken using an app. For example, purchasing a product, booking a flight, or – in a gaming context – completing a game tutorial, or passing level 10.
In fact, almost 60% of apps measure revenue events, but the second and third most popular events — Login and Registration — trail far behind, as they are measured by only 30% of apps. Among Gaming apps, the average number of apps measuring for Level Achieved is 42%, while only 19% of apps measure Tutorial Completion, significantly lower than the 70-80% that measure revenue. Since app performance is significantly higher in apps that measure events throughout the customer cycle, closing this gap can certainly lead to better results.
Revenue is best optimized with granular measurement
Across nearly all verticals, performance is significantly higher in apps that measure granular in-app events, rich with information about the action taken, rather than standard events that only contain information about whether the action was taken.
For example, granular in-app events measured for purchases that include data on the content purchased, specific content ID, currency used, value of the purchase, customer user ID, final purchase and more, give more insights into conversions within an app. Overall, the report found, granular event measurement helps marketers make smarter decisions and ultimately drive higher user retention rates. Since retention is highly correlated with revenue, it is critical that marketers optimize to encourage ongoing usage of their apps and increase the likelihood of purchases and the lifetime value of their users.
Rosenfelder continues: “With all of the information marketers have at their fingertips, it is critical they invest in an infrastructure that allows for more granular measurement, as well as in advanced tools, tech and people that are equipped to draw the most actionable insights from the data without compromising productivity.”
