Creating Real Aha Moments? Here's How to Calculate Your App Engagement Rate

January 24, 2023
Business Development

Turning active users into fully engaged users requires a more specialised approach – here’s how to identify truly unique actions and use them to calculate your app engagement rate 

Engagement is one of the most important metrics for app success.

It’s right up there alongside retention, revenue and profitability when it comes to expressing the actual value of your product. Not to mention engagement can be a key indicator of specific places to improve your app.

That said, most engagement metrics focus only on active users. But a much more comprehensive approach is to calculate your app engagement rate and use it to analyse your app from various viewpoints to get a much more in-depth view of how users actually engage with your product.

Here’s how it works…

What is your in-app engagement rate?

An app engagement rate measures how your active users interact with your product. Simply put, a higher engagement rate usually means your users are more active and more likely to keep using your app in the future.

It’s different from just measuring the number of active users, in that you base your engagement rate on specific high-value actions, like “engagement events” or KPIs. You’re not just trying to see how many people open your app every day, you want to see how many of them realise their goals and have real aha moments (moments of delight) while using it.

For example: An active user might just be someone who opens the app and takes a few actions. A truly engaged user, however, is an active one that takes the specific steps you designed the app for (or the ones that you know deliver real value to them and to you).

NOTE: This does mean that there are no hard-and-fast guides for exactly what to measure, Every app will have different goals, actions and KPIs. But we’ve given a guide on how to identify the specific “engagement events” to track (a little lower down).

What is a good engagement rate? 

This will vary hugely depending on the industry and the specific goals of the app. However, generally speaking, a higher engagement rate is considered to be better.

For example, the average engagement rate for apps in the gaming industry is around 30-40%. While, for non-gaming apps, the average engagement rate is around 10-20%. But again, it will vary based on the type of app and the intended audience.

How to calculate app engagement rate

The formula for calculating engagement rate is:

Engagement Rate = (Number of Engaged Users / Total Active Users) x 100

"Engaged Users" in this case are those who’ve taken a specific action. For example, those who’ve made a purchase, created an account, shared content, or completed a level in a game.

Here's another example:

If your app has 1000 total active users today and 250 of them made a purchase (KPI), the engagement rate would be:

(250 / 1000) x 100 = 25%

This becomes really handy when you start tracking and comparing it over time (days, weeks, months) to identify trends and patterns because that simplified percentage expression makes instant comparisons so much easier (more on that a little later).

Furthermore, as we’ve seen in the above example, where the “engagement event/KPI” was making a purchase, choosing a specific engagement event to track is what gives you those valuable deeper insights.

How to identify engagement events/KPIs to track

This is the important part; and one for which there are no hard-and-fast rules. It’s really dependent on what your product is designed for and which actions you know lead to long-term success and retention.

An extremely simplified view to take here is to just use the events that have value for you. For example: in a product with in-app purchases, you could just track your sales.

It’s worth noting, however, that for long-term success, it might be better to base some of your KPIs on the user’s needs and goals. As growth consultant Lincoln Murphy says: “engagement is when your customer is realising value”.

So a set of good KPIs to tack could be those “aha moments” of delight when your user achieves a specific goal. When they level up, receive a badge, complete their profile or make a connection – you’ll know your high-value moments best.

NOTE: This does mean you have a number of different engagement events to track, and therefore you’ll have a few different engagement rates. Agree on the main ones that work for you, and then use them to get even deeper insights over time.

3 useful ways to use app engagement rates for deeper insights

Now you can use that simplified percentage engagement rate expression to get some deeper insights:

Overview: Engagement by time interval

Compare your engagement rate over time – days, weeks, months – just like you would use your active users to gauge retention rate, but this time look for patterns and trends in usage, so you can make better marketing decisions, spot issues and try different engagement tactics.

Granular: Engagement by channel/source

For more advanced marketing insights, you want to know which users generate the most engagement. And a simple way to do that is to group users into a cohort by the channel they came through – for example: organic, app store, website, direct ads, or sales funnels. Analyse them weekly or monthly, and see which channel delivers the most long-term engaged users, so you know where to pool your resources.

In-depth: Engagement by feature

Nothing beats knowing exactly which features your users love because you can just focus your resources on developing those. You can track individual features as “engagement events” over time and see which ones get the most usage.

Or, you can even track the related preceding features that lead to your most-desired conversions as “engagement events” and then analyse them over time to see which specific features give you the most conversions at the end.

What if your user engagement is low?

Engagement is such an important factor for product success. Research shows almost half of all downloaded apps are uninstalled within 1 month, simply because the person stops using them.

When you notice a drop in engagement, the first order of business should be to figure out what it is happening. So start investigating by looking at these 9 common causes of low app engagement.

Let us help you fix your app engagement

You already know that we at Specno build some of the coolest, high-engagement apps. But did you know that we also have a specialist team that helps you boost your existing app?

Yes! We use our best-practice expertise ad insider know-how to run extensive app audits, user research, app optimisation and even app redesign – contact Specno now.(You’ll get a response immediately.)

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