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What User Acquisition Means

Nowadays, having an app means nothing if you don’t have any user in it. That’s why you need traffic. This traffic can be mainly achieved in three different ways: through organic basics by applying ASO techniques, through word-of- mouth/ social media/ PR, or through user acquisition campaigns. In this post, I’ll explain what user acquisition really means, why it’s so important in any mobile marketing strategy and what factors you need to take into account.

User Acquisition means buying traffic, as simple as that. Same way you see commercials on TV that may made you buy any specific product, app marketers run ad campaigns through very different channels to make users download the app or make an specific action in the app (like make a purchase or complete the tutorial in a game). But after these simple terms, we see one of the biggest challenges of the mobile app marketing.

Since here we are looking for an user to do a specific actions (to install an app), we are talking here about performance marketing. Performance means results and results implies conversions. That’s why we need to evaluate two main key elements: CTR and IR. First is CTR or Click-Through- Rate, which means how many users click on an ad out of how many users have seen that ad. Second is IR or Install Rate, which is, from all those users who have clicked on the ad, how many have ended up downloading the app. Understand, interpret and optimize these metrics is crucial to understand how the campaign is performing.

So, why is UA so important? Because it’s the unique way where it’s on you to drive traffic to your app. And why do I need traffic? You may need traffic because your product is in an early stage (tech- launch or soft- launch) and you need to know how things are going on into your app: you want to know if you have bugs, what your session length is, how much money you are able to make per user, what your retention on day 7 is, etc. And second reason why you may need traffic is because you need to scale your business, which means you need users who engage with your app to monetize them via in-app purchases or via ads. You need users because you need to make money from them.

Last, let’s focus now on the most important factors you need to take into account when you are thinking about how to run your user acquisition campaign:

  • Lifetime Value (LTV) and Cost Per Install (CPI). Nowadays, doing UA is expensive and CPIs are high. So the first thing you need to know is what your LTV is -this is, how much money you make per user during all the time the user is interacting with you app. Once I know this, I have to make sure my CPI is lower than my LTV; otherwise I’ll be losing money. Let’s put this way: if I’m making $1 per user as average, I shouldn’t spend more than that in acquiring a new user. On the contrary, if my LTV is $0,5 but average CPI is $1, it has no sense to keep running the campaign.
  • Goal and events: You need to decide which is the main goal of your campaign and plan it accordingly. Because it’s not the same whether you just want to test your app and make sure it doesn’t have bugs or whether you want to determine which LTV can you expect before a global launch or wether you want to retarget lost users, strategies cannot be the same. And neither the events you need to measure. An event means a specific action in your app you want to track, for instance, tutorial completion, level 5th achieved or purchase.
  • Channels and geos:  Channels here means which sources of traffic you use. There are tons of ad networks, agencies and social channels expert in performance marketing that are willing to provide you installs. Depending on your goal and on the performance of each channel, you need to decide. Same way, countries for your campaign will vary depending on your goal. It’s not the same if you want to test bugs, where you can go to cheap tier3 countries as Indonesia, Philippines or Mexico, than if you want to measure soft-launch, where you’ll probably need to reach tier1 countries as Canada, United Kingdom or Australia.
  • Tracking system: In mobile marketing is all about measuring. When you run an UA campaign you need to use an independent analytic system that, first, will assure that the number of installs of the traffic source are reals and there’s no fraud and, second, allow you to evaluate the performance and return of investment of each channel so you can make the right decisions when optimizing or when opening/ closing sources. Appsflyer, Adjust, Kochava are some of them.

As you can see here, UA is a complex and challenging task for all mobile app marketers. In future posts, we’ll keep diving into this. Stay tune.

Picture credit: Applift

Filed under: UA

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