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.
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.
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.
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
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: