Translating Analytics Data into KPIs
What are the key performance indicators (KPIs) for your business? Depending on the industry you’re in, your focus may be on customer lifetime value, net promoter score, and customer acquisition cost. Alternatively, your focus may be on customer lifetime value, cost of goods sold, and percentage of product defects. There are hundreds of KPIs, and yours should be unique to your business.
Thanks to analytics tools like Firebase Analytics, New Relic, Flurry Analytics, Mixpanel, and more, it is easier than ever to collect data about app performance and user traffic. But what are the effects of session length, daily active users, or screen views on KPIs? If your business is reliant on an application, it is crucial to understand how your app analytics directly impact your KPIs.
If you sell products through your application and your primary KPIs are order value and customer retention, simply calculating cart conversions, order value, and repeat customers misses all of the context of customer buying behavior. If you’re only looking at the result, not the path to the result, you can’t make fully informed decisions. Understanding what behaviors make a customer more or less likely to buy guides your inventory and marketing decisions to capitalize on behaviors most likely to convert.
Gaming & Social Networks
Applications like social networking and mobile games geared around user engagement tend to have business KPIs such as monthly active users and churn. Just like eCommerce, though, these numbers are meaningless if your app analytics don’t provide insight as to what drives your KPI metrics. Looking at churn alone misses the cause of user abandonment. Where drop-off actually occurs indicates where user expectations don’t align with user experience.
Incentivizing users to share and engage more with an app can produce a wealth of additional analytical data. If these reward-driven behaviors aren’t in alignment with your KPIs, they create confusion instead of clarity. It’s also important to understand the financial value of various user actions to create the foundation for your proprietary economy. The higher the value to your company, the higher the user’s reward for engaging in the action. Checking in, sharing, and following behaviors may each lead to a unique chain reaction of user loyalty or disengagement.
Calculating Performance from Event Data
Why can’t app analytics and business KPIs live separately, only to appear on the same slide deck in your annual report? Because user behavior in your application directly affects your ability to hit your KPI metrics. If you can’t calculate it, you’re flying blind. Calculating it involves a lot of math if you want to do it manually from data exports or a lot of development time if you want to automate it.
We build custom automations to translate user actions in an app to unique, actionable KPI insights for nearly every app we build. Event data provides a window into areas of an app where users lose interest, get frustrated, or make mistakes. It also gives a glimpse into what users love about the app and where your brand message and the experience are in alignment. These insights are essential to the growth and success of the app.
Regardless of who built your app, we can help monitor your event data and reveal how events influence your KPIs. Growing revenue, raising a funding round, or keeping investors informed about performance all require a deep understanding of how your customers engage with your application. Translating event data into their impact on your company’s KPIs is the best way to do exactly that.