Definition of user acquisition
User acquisition, shortened to UA, is the process of acquiring new users for a mobile app and it is intended to generate installs through marketing activities. In the field of mobile apps, User Acquisition is the action used to drive new users to an app and this process can be achieved with the help of various marketing activities.
User acquisition activities can bring two specific types of users to the app: organic and non-organic users. Organic user acquisition is the process of acquiring new customers without advertising activities. Organic user acquisition can also be enhanced in different ways, for example through recommendations, promotions and referral programs.
On the other hand, non-organic or paid user acquisition happens when users are driven to the installation of an app through advertisements or other marketing channels. This is the process of paying to advertise an app to drive relevant traffic and convert new users, who are called “paid user”.
Today, there are more than 7 million apps available in the app stores and, because of that, getting organic users is becoming extremely challenging. Therefore, successful mobile user acquisition is essential for the growth and the accommodation of the decline of organic installs.
How to create a strategic user acquisition plan
Mobile apps generate new installs through a combination of marketing activities, such as paid media marketing, owned media marketing, app store optimization (ASO) and retargeting and re-engagement campaigns.
Let’s look at the main features of these methods here below:
- Paid media marketing: this marketing method involves paying media channels to display ads that stimulate the target audience to install the apps. Marketers need to track all the data and the performance of their apps, influencing high-profile individuals to create a valid paid user acquisition strategy. They can also track cost per action and install rate to ensure an advantageous paid user acquisition strategy. Some common examples include banners, targeted posts and ads published on social media.There are also the “traditional” media such as TV, radio, billboards and newspaper which aim to increase brand awareness, as opposed to the app install campaigns, which are exclusively targeted at acquiring new users.
- Owned media marketing: in contrast to paid media marketing, owned media marketing refers to the tools that help to drive web users to an app. Some examples of owned media assets include email targeting, SMS, QR codes, and other similar media. Since this channel can take a lot of time to earn owned media, it may not be as scalable as paid user acquisition.
- App store optimization (ASO): this type of marketing constitutes an important activity because it boosts organic installs achieving optimization and visibility for the app, even if its scalability is not comparable with paid media marketing. It is the equivalent of the web’s SEO because it aims to rank for target keywords making the app easily discoverable. It can be usually done in-house by a UA manager or serviced via an external ASO agency.
- Retargeting and re-engagement campaigns: the final method, retargeting and re-engagement involve all the marketing activities which reach out to those users that have already interacted with the company without downloading the app or users that have uninstalled it. Once again, retargeting campaigns can’t provide the same combination of high quality and huge volumes that paid user acquisition can.
All these methods can be crucial for the user acquisition strategy, for this reason, marketers should give the right importance to the tools and insights to improve their mobile user acquisition programme.
Advantages of paid user acquisition
Successful mobile user acquisition can boost the optimization of your app, hence it is important to track down high-quality users to preserve the maximization of your app business revenues. Every developer should invest in a user acquisition strategy that can attract the right users for a company and increase the chances of retaining them for the long term.
User acquisition sources such as ad networks and DSPs use specific techniques to get potential customers to drive action. High-quality users are the ones that don’t just download the app but interact with it. The real problem is how to find them and how we can learn who are the users that are more likely to convert into “true fans”.
Targeting and acquiring high-quality users is not that easy, but every developer should follow some specific tips to achieve good results. Starting from the fact that installs don’t always lead to high-quality app users and revenues, many advertisers decide to optimize their user acquisition campaign towards KPIs (Key Performance Indicators) such as LTV and ARPU.
Lifetime value (LTV) is a core metric in mobile business growth capable of defining how valuable users are during the entire period that they are using an app. LTV can help developers to optimize revenue streams like in-app purchases and in-app advertising by identifying how much money they can afford to spend on user acquisition for mobile apps and generating a positive ROI.
Average Revenue Per User, or ARPU, is another key monetization metric in a mobile app campaign, which is different from LTV. Although their metrics are usually confusing, ARPU represents the most important metric for any business because it oversees the measures of the revenue generated per user or unit.
The main difference with LTV is that it only estimates the average revenue in a limited timeframe and not in the whole period. Together with ARPU, LTV is one of the most significant monetization metrics because marketers can make more informed decisions on budget allocation, optimizing the spending on the app install campaign.Developers can also try to acquire users with the help of A.I. and machine learning algorithms that are used to generate several in-app events.
Typically, there are two different kinds of in-app events: standard in-app events that include actions such as registration, opens and purchases which will help you understand the behaviour of users inside the app; rich in-app events which concern user invites, social shares and level achievements that help you determine the real value of each user. These insights can help every developer take a campaign optimization and identify a more impactful audience.
Another technique that helps a marketer understand the success of its campaign is the use of the Return on Investment (ROI), which is calculated with the intent of measuring your net profit. Marketing ROI is used to check the long-term profitability and to measure the overall profits, considering the LTV rather than the ARPU. It is quite different from the ROAS, which only refers to the return on ad spend and they are more useful in the short term. Measuring your marketing campaign’s ROI will help you understand the performance of your app and whether your campaigns are making or losing money, generating revenue and sales.
When talking about user acquisition, one of the core goals is defining the several methods that create a strategic user acquisition plan. As we have seen, paid media marketing, owned media marketing, ASO and retargeting and re-engagement campaigns are the most tactical methods used to create a strategic UA plan. The optimization of paid user acquisition can lead to specific advantages, hence developers should guarantee an efficient customer acquisition technique to get high-quality users for the app. Many advertisers decide to optimize their campaign with the help of KPIs such as LTV and ARPU, but they can also try to acquire users with the help of in-app events and the increase of marketing ROI.