Achieving financial success in today’s hyper-competitive application market can be difficult if you haven’t taken enough measures to reach a certain ROI for your project. It becomes even more challenging if it’s a free mobile app and is based on a comparatively newer concept looking to serve an unfamiliar audience-base.
Many mobile app developers even fail to scope-out the right numbers with their routine attempts as they lack the right approach and are not sure on how to identify factors and determine trends to measure ROI of their venture.
According to experts, this happens with about 65% of developers who miss on to hit the right approach and fail to create a comprehensive plan to determine, evaluate and track Return on Investment – which makes them miserably fail with reaching the right revenue generation plan and consequently miss to achieve their profit goals.
As per them, if these businesses followed these 5 steps to determine ROI they would have aptly accomplished their financial objectives:
Step 1: Create a Measurement Plan
Creating an effective measurement plan requires developers to consider implementing the analytics into the app, as the firsts of their efforts. With this attempt, they should be planning to measure ROI, setting up performance and conversion trackers across different communication and vending points of the app. Here, the earlier you start creating and implementing your ROI plan the better it is, as you get to measure it at a longer stretch across all phases – to be able to compare with performance and trends better. Also, make sure you follow the metrics that help you measure your app performance better – like in the case of an e-commerce app, creating a measurement plan based on successful check-outs makes real sense!
Step 2: Calculate Customer Lifetime Value
In order to measure any app’s revenue well, it is important to quantify its Customer Lifetime Value right. CLV is nothing but the expected revenue that the customer will contribute to, over the course of his or her association with the app. This can be calculated by adding up the total amount of purchases made by a customer on the app. This can also be reached by calculating total sales attained across all time and further dividing it by a total number of users on the app. For businesses that already have a website can calculate their earnings and reach a projected CLV for their mobile app. This can help them effectively forecast the possible role and impact of the planned app on expanding the lifetime value.
Step 3: Know Your Overall Cost
Knowing the whole-cost of your app in advance helps you to be all prepared to deal with different factors and propositions impacting the app’s cost-benefit share. This cost analysis takes into account the initial cost of building the app along with the operational and maintenance cost that goes into curating, feeding, updating and promoting the app. Among other standard methods of cost calculation, developers can use gauging and attribution tools to reach more detailed and refined results that can help them setting up a more effective ROI generation plan.
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Step 4: Understand Not All Users Are the Same
Users coming from different sources and representing different consumption patterns impact differently and should be segregated well to reach more reliable ROI scores. Customers who have a purchasing history with your app and visit you directly are more valuable than a visitor coming through a Facebook Advertisement. To that, if some user has plunged into your website and downloaded the app from there, turns out to be a more promising and valuable visitor. Keep these visitors marked separately to help you gain a better perspective of returns.
Step 5: Make the Metrics Actionable
The metrics that have been set to measure the performance, in the beginning, should be put into an actionable plan. This requires making regular refinements and changes, gauging the results from the metrics being applied. If you are going with multiple metrics you should look at how they are performing relatively and combine results from all to reach the best decisions. If there’s just one certain metric you are following do A/B testing (experimenting with different content on the same screen and appointing different resources and engagement points to be tested across different time spans) to ensure you are attaining the most of it.
If followed right, these 5 steps can really be of help in measuring the ROI of your mobile app and can help you out with reaching finest of options to seize best of returns!