Key performance indicators (KPIs) are your sword and shield in the battle against your competitors in the market. As the competition gets more and more cutthroat, your product’s success depends on your analytical approach towards the statistics. Gathering the numbers and determining your KPIs, analyzing the results – this is your path to developing wise strategies.
DNA325 presents 4 KPIs You Definitely Should Take Into Consideration
There is a countless amount of KPIs that fit one product or another. So, it is up to you to determine which KPIs you should calculate on a constant basis.
Overall, KPIs can be divided into four main types: percentages, rates, averages, and ratios. All of these are important to be included in your roaster of KPIs.
Yet, there are some KPIs that are applicable to any product, be it a website, a mobile app or a web-based application.
1. Revenue Per User
RPU is one of the most important metrics when it comes to evaluating the financial success of your product. It is determined as total revenue divided by the number of users. Total revenue may include in-app purchases, revenues from built-in ads, etc.
2. Retention Rate
This indicator allows you to evaluate the level of satisfaction with your product. It is common to calculate Retention Rate Day X, where X is the number of days. For example, Retention Rate Day 7 will give a percentage of users that came back to using your product at least once in 7 days. It is also possible to calculate Retention Rate Day 14, 30, 90.
These indicators help you determine the scale of using your product in different periods of time:
- Daily Active Users – the number of unique users that used your product during one day;
- Weekly Active Users – the number of unique users that used your product during one week;
- Monthly Active Users – the number of unique users that used your product during one month.
All these indicators should increase as your product grows. Your task is to make sure it happens as the time goes on.
4. Conversion Rate
This is one of the basic indicators that help any business develop and polish its marketing strategy. Conversion Rate can be determined for all the steps that it takes for a common passer-by to become a regular user.
4 Painless Steps Of Measuring KPIs
So, how can analytical apps help you measure dozens or, perhaps, even hundreds of KPIs? It takes four plain yet comprehensive steps.
Step 1. Gathering Data
If you decide to calculate KPIs yourself, this must be the trickiest part of the process for you. Analytical apps allow you to lean back and invest your time into enhancing your business. Applications accumulate the required data through being integrated with all the IT sources of your company. These may include your website, software and the product itself. The integration process is seamless, so there’s no need to worry about potential losses. One more advantage of analytical apps is that gathering data can be scheduled. The schedule can be custom, it could be daily or weekly or even every 3 hours – it all depends on your company’s needs in calculating KPIs.
Step 2. Structuring Data
All the gathered data must be stored somewhere, obviously. Applications don’t just store the data – they divide different indicators into various clusters. This allows you to find related indicators easily as ever. From now on, you don’t need to know the precise name of the indicator to get raw data based on a specific parameter that interests you, be it the number of users every day, the duration of using your product, etc.
Step 3. Calculating KPIs
Once you’ve chosen the KPIs that you need to determine your product’s performance, let the app do all the calculations. All that can be required from you is to set the formulas for calculating custom KPIs. After you’ve done that, the calculations are done automatically.
Step 4. Visualization
KPIs are worth nothing unless they are visualized. Visualization is the tool that makes KPIs easily understandable for everyone, from CEOs to marketing interns. Besides, the visualized data is your weapon of choice when presenting your product and its success to potential investors and it could even be displayed on your company’s website.
The best visualization tools can be recognized by the following features:
- Interactivity: analytic applications allow you customize charts depending on your needs. For example, sometimes you need to see the big picture, and, sometimes, you need to dive into details and see the correlations with other indicators. All of this allows you to find connections where you would have never thought of, as well as present the data in the most comprehensive way.
- Powerful Simplicity: visuals that you are provided with should be simple yet powerful. That means that there shouldn’t be any excessive visual elements that get in the way of understanding the main trend represented by the chart. Besides, too many colors can be annoying, can’t they? The key to this powerful simplicity is also embodied in the app’s interactivity: the more you can adjust the visual elements of charts, the better.
- Intuitive Interface: this is a must for any application, of course. Yet, it is vital for analytic applications as you should be able to use the app with no special training. And using the app means not only customizing charts that you get as the result but also filtering data that is gathered and managing settings.
The Bottom Line
Analytic apps can become a powerful tool for calculating and analyzing KPIs. But for that to be true, not only the app must be interactive and intuitive to use, you should know what to analyze and what KPIs are crucial to your business as well. This synergy is definitely worth striving for. Nothing speaks louder than numbers.
Author: Petro Borysov