Mobile user lifetime value, or LTV, is a metric that measures the total revenue a mobile app user generates over their lifetime as an active customer. Here’s what marketing teams should know about understanding and calculating LTV:
- Calculate Revenue per User – To calculate LTV you need to first determine how much revenue each individual user has generated through purchases of goods/services within your application.
- Determine Retention Rate – After determining revenue per user next step is figuring out retention rate i.e how long on average users stay engaged with your brand before losing interest
- Establish Gross Margin- This refers to the amount of money left after accounting for expenses associated with providing service/product offering in question
- Predicting Customer Lifetime – Use data analysis tools & insights from previous years’ trends concerning customer behaviour like churn rates etc can help predict expected time period before customers stop engaging with business offerings.
By combining these metrics together marketers can get a clearer picture of overall profitability by segmenting users based on different characteristics such as demographics, behaviour patterns and more..
In conclusion, it’s important for businesses not only to understand but also actively work towards increasing mobile app engagement resulting in higher revenues being generated over time.. By analyzing available data sets while taking into account factors mentioned above one can develop strategies designed specifically around boosting retention rates leading towards higher ROI potential..