Hi All,
Thanks for approving me!
I am the founder of this app – FaborSkip. I launched this app 1 month ago but have been working on this idea past 2 years.
Download app on Android here – https://play.google.com/store/apps/details?id=com.faborskip
and iOS here – https://itunes.apple.com/us/app/faborskip-shopping-style-inspiration/id980615074?ls=1&mt=8
I have already invested enough time & money in this app. Right now I am trying to understand if it is worth investing more in it or not. The way I am trying to do is calculate CLV & CAC. Someone told me that the CLV should be 3 times greater than CAC. But to calculate CLV, I need data like user retention %. I have installed Google Analytics in the app but somehow I am still struggling to get this data out. There is cohort analysis in GA but its just so useless (may be because its in beta version)
Can someone guide me on this? I know I don’t have enough data (launched this app 1 month back) but I still want to build some estimates based on data that I have. And what are the benchmarks for an app like this?
BRIEF About app:
We help people discover new outfits/looks made using curated products from different online stores. Our stylists make these outfits/looks and post on our app something like below –
When you click the buy link, it takes you to the respective e-commerce store.
The app is in beta version right now. There are more features to be added. And yes, bugs need to be fixed too. I also need to install better analytics like Mixpanel.
Questions that I have –
1) How do know whats my app user retention % ?
2) How do I calculate CLV in my case?
3) Is CAC = CPI?
4) What are the benchmarks?
Any help is appreciated!! Thanks 🙂
Twitter handle – @psychiBOY2
Rahul Varshneya
These are the wrong questions to ask if you’ve just launched your app. Get product/market fit first and then if there’s a compelling need, there are always routes to monetize the app wherein you get a CLV at least 3x of CAC.
To study app engagement, you can integrate Mixpanel or Intercom.
Arihant Jain
Hi Rahul, Thanks for your reply! How do you validate product/market fit? Through User Retention? If yes, how do I know what are the benchmarks in my industry?
Rahul Varshneya
There’s no such thing as industry benchmark. If at least 40% of your users are engaged within your app (using it at a frequency that is defined by the use case) and can’t imagine their life without this app, then you’ve got product/market fit in the early stages.
What you have to remember is that just getting through to the first set of users isn’t going to cut it. You have to validate your app with the relevant audience. So you may have 1000 downloads, but not all of them maybe your audience.
Building a product is an iterative process. You can’t judge the success or failure within a month. Many successful apps have taken over a year to achieve any success or even product/market fit.
asha chaudhry
arihant – PLS READ EVERY SINGLE POST WRITTEN BY RAHUL VARSHNEYA!! he is the app guru on trhs!!
Amol Pomane
Hello Arihant,
It is too early to ask these questions right now, it’s been just a month you launched this app. There are very good ways to test your product market fit. One is offline and another is online, you can talk to random 100 users of your app and know their feedback and pain points while using the app. You will get lots of valuable feedback from them and also it will test the idea.
For online, you have installed google analytics, try to use mixpanel it is very good for mobile apps. Understand the user flow and exit pages. Most important is the time on the app, then you will come to know what is happening with your app.
CLV will depend on the transaction or the goals you have. Whatever your revenue model would be you need to make sure people will use it then and then only the CLV factor will play a role here. It is the last parameter to look at for any app. Incase of CAC check some growth hacking ways to bring it down in this way you can increase the userbase and will have a clear roadmap.For CAC=CPI?, they are not equal when you say you have any acquisition that means the user is using your app, not just installing it. But, don’t think of quitting, the worst you will do is pivot but that is a good sign if you have a clear date for why you are doing it.