Mobile Marketing KPI’s for analyzing your marketing campaign profitability

People (your customers) are spending more of their time on their mobile devices than ever before. As mobile becomes the social ‘norm’ in the marketplace, businesses need to strategize on how to acquire more of their potential customers through this medium.  .

What is a KPI?

It is a quantifiable metric that reflects how well an organization is achieving its stated goals and objectives.

How to ensure your KPI metrics and campaigns are running profitably:

• Know what time period you want to become profitable within (e.g. 1 year). This will give your calculations a clear goal that can define success/failure.
• Select a KPI (key performance indicators) and correlate what the minimum acceptable level in this KPI is to turn a profit within your target time frame.
• Be sure to assess your predictions within sensible user segments. Apply different predictions for Android and iOS campaigns.
• Feed new data into your prediction system and assess your profit prediction consistently to ensure your profit forecast is on-target.
• Explore other methods to raise the accuracy of your model, including different attribution models and K-Factor and organic uplift analysis.

Why focus on KPI for your marketing campaigns?

• 3 out of 4 Canadians and Americans now own smartphones
• More and more of those people are using them to make purchases
• Most searches are now performed from a mobile device
• 71% of all time on the internet is now spent on a mobile device.

Four Common KPI’s

Retention Rate – is one of the most commonly used metrics for assessing success in mobile app marketing. It is calculable for every app regardless of monetization method. It is easy to calculate and it can correlate well with ROI.

Average Revenue Per User (ARPU) Average Revenue Per Daily Active User (ARPDAU) – often discussed as a KPI for mobile marketing. ARPU/ARPDAU is one of the components of LTV (Lifetime Value), along with some form of retention or usage rate. ARPU/ARPDAU can be used predict the maximum amount that can be paid to acquire a new user and remain profit and can raise the red flag when profitability is unlikely.

The Most Versatile KPI: ROAS (Return on Ad Spend) – ROAS is a commonly used KPI for predicting profitability, generally more useful than retention rate or ARPU/ARPDAU because it is predicated on the core inputs of profit.

Lifetime Value (LTV) – LTV is the most useful KPI for determining whether your campaigns will turn a profit, and is the most desirable KPIs because:

• LTV assesses the growth trends of both user retention and monetization, which none of the above mentioned KPIs do.
• Once established, LTV, like APRU/ARPDAU, is the fastest at predict profitability (i.e. as early as CPI or cost per paying user).

Thanks for reading and stay tuned for more posts breaking down mobile marketing concepts.