Definition

Paying Users (PU) or premium users are those who make in-app purchases. This KPI measures the percentage of installers who made an in-app purchase within a set time-frame from installing the app.

Importance

The number of paying users relates directly to an app’s feasibility and sustainability, namely the ability of an app to generate revenue and keep on doing so.

Impact

On average, only 5% of users who install an app go on to make an in-app purchase. That may seem minimal, but indications are that this small percentage of high value users generate over 80% of app revenues.

Significance to Strategy Development

Paying users provides a crucial foundation to establish, measure, and review monetization strategies.

Formula

The formula for calculating Install to Payer Conversion is:

Install to Payer Conversion = Total Number of Users that Made a Purchase ÷ Total Number of Installs

Example

Over a 20-day period, an app registered 200 installs. One hundred of these installs (or users) made in-app purchases during that time, a very impressive install-to-payer conversion rate of 50%!

More Essential Mobile App Marketing KPIs:

Learn about the essential Key Performance Indicators to measure and improve your mobile app marketing acquisition, engagement, retention, conversion and campaign performance. Check out more KPI metrics to measure your app success:

•  App Installs  
• Average Order Value (AOV)  
• Average Revenue Per User (ARPU)  
• Cost Per Install, Cost Per Action and Customer
  Acquisition Cost (CPI, CPA, CAC)  
• Daily Active Users (DAUs) and Monthly Active
  Users (MAUs)  
• Install per Mille (IPM)  
• Lifetime Value (LTV)  
• Purchase Frequency 
• Return On Ad Spend (ROAS)