Many app companies want to get a sense of their potential app growth trajectory before launching or scaling their app. This is critical for a number of reasons, including providing a more accurate image of your company’s realistic and sustainable progress. It can also help ensure that you are on the right track as you progress, with the added benefit of assuring investors that your growth goals are on track to be reached or will be met.
Development projections for new apps are mainly used to ensure that you are sustainably at the right pace without the benefit of existing app data, while for scaling apps, they will assist in the return on investment by preventing excessive losses and increasing conversion rates.
Forecasting on profit margins, expenditure, turnover, risk assessment, and other key elements of a business model can be very useful for business planning.
The Importance of a Sales Forecast
The backbone of your business plan is your sales forecast. Sales are the yardstick by which people judge a company’s success and growth, and your sales outlook sets the bar for expenses, earnings, and growth rate. Even if you don’t track any other figures, the sales forecast is almost always the first set of numbers you’ll track for plan versus actual use.
The average revenue per user is one of the ways that you can measure how your application will make money.
Simply forecast your revenue, track plan-versus-actual performance, and make corrections — just that method, just the sales forecast and monitoring, is business planning.
Focus on Activation First, Not Acquisition
Businesses that aren’t mobile-first or marketing managers who don’t understand product design, growth hacking, or marketing analytics most often use User acquisition (UA) to determine app growth rate.
But, when compared to activation, retention, sales, and referral (AARRR), which make up Dave McClure’s popular pirate metrics model, acquisition is the easy part of growing a mobile app.
While activation is where you can make the biggest improvements in user retention and all the metrics that follow, good retention ensures that you’re not only renting users, but also turning them into raving fans. And once you’ve worked out how to keep your clients, the rest will fall into place.
Activation provides the most flexibility, and retention improves all subsequent metrics the most, including a major effect on your acquisition expense.
How to Create an App Marketing Growth Cycle
Growing the number of paying regular active users is one of the most important targets for app publishers. They start by obtaining users. After that, they work to turn them into paying customers. They then attempt to raise their average spend.
When users spend more money on apps, app publishers have more money to invest in expanding their customer base, and the cycle starts all over again.
The 5-Step App Marketing Growth Cycle:
- Acquire an installed base.
- Convert installed base into active users.
- Convert active users into paying users.
- Increase the average revenue of paying users.
- Reinvest profits into increasing the installed base (Back to step 1).
With this structure in mind, app developers can focus on getting the most out of each step.
Effective app and mobile marketing requires optimising for the full app user lifecycle, ensuring those users are high-intent, engaged and activated. Learn how to grow your app user base from 1 – 100k according to Appello Software.
The first step toward unlocking exponential growth for your product is accurately modelling your growth and developing a growth strategy. Demand forecasting is a type of data analytics that examines historical sales data and employs algorithms to forecast future sales.
The secret to forecasting is to be organised and to know your goals/KPIs. Additionally, keep meticulous track of all existing data and mobile app growth statistics. Combine the tips above with an accurate image of where you are now vs where you want to be. By doing this you should be able to predict your app’s growth easily and effectively.
The time period over which revenues are measured can vary depending on your business.
Finally, simply publishing your app in the app stores is never sufficient. Ongoing marketing activities are needed so that people are aware of its presence. If you’ve built up a user base, you’ll need to find out how to look after them and retain them.
The next step is to find innovative ways to attract new customers and sustain a higher rate of growth. Keep the system up to date and running smoothly. Use any means at your disposal to spread the word, and your app will continue to evolve. It will remain popular even as the environment of its industry shifts.
Appello Software is a full-service software company, supporting clients from the design to launch stage. Therefore, our App Marketing services play a big role in why clients choose us. See the GetReminded case study as an example of how closely we work with clients to scale their business.
Growth is a major business priority.