The travel industry is one of the most competitive, fast-paced, and dynamic industries. It continues to emerge from rough years with almost $613 billion in bookings in 2021. The jet setters are returning to the idea of traveling again.

How can travel brands begin to rebuild deep customer relationships to rebound in 2022 and beyond? Well, the answer is user engagement! It is the key to any successful app and extends to every industry that involves meaningful interactions. 

With the increasing number of travel apps, measuring user engagement on your travel app is essential to know where you are on the path to success. This article will discuss user engagement and the critical KPIs to measure for travel apps.

What is User Engagement?

User engagement is any interaction your user has within your app or product. It measures how often users open the app, visit, view, and interact with different features. 

Engagement is an ongoing strategy that should not just be a mere response to a long silence or inactivity. 

Knowing what is working within the app, what isn’t and why is essential to engage your users better and retain them over time. But, there is no one universal metric to measure user engagement. 

The primary goal is to measure the most eminent indicators of whether your users are deriving value from your app to continue using it. As we know, the human attention span is shorter than that of a goldfish. Hence, it is essential to track user engagement to understand what users want and motivates them to stay engaged and use your app for a long time.

Key Metrics to Measure User Engagement for Travel Apps 

Travelers are actively looking for information on places to travel, pricing and availability of trips, accommodation, and flight details before deciding to book or take a trip. User engagement with your app spans many stages of its journey, starting pretty early, even before a user installs or registers.

Here are some of the most important metrics that can measure how well your users are engaging with your app and what you can do to improve it. 

#1 Retention rate

The retention rate is the percentage of users who return to your app after their first session. It is a key indicator of your app’s success and can be used as a predictor of future monetization. In addition, the retention rate is an excellent quality metric for travel apps because it shows how well users engage with your app in each session. 

Aggregate Retention Rate = No. of monthly active users / No. of installs

A high retention rate indicates users are engaged with your app and would rely on it for their future travel needs. 

#2 Churn Rate

The churn rate is the percentage of users that stop using your travel app over a certain period. If a user is happy and satisfied with your app, they do not need to stop using it. It is crucial to know the churn rate as it directly shows your app’s growth rate, why users have stopped using it, and what areas you can improve to decrease the churn. 

As it is known, acquiring a new user can cost five times more than retaining an existing user. 

-Low churn rate indicates that the users are satisfied and will continue to engage with your product.

-High churn rate indicates that the customers are dissatisfied and find no value in your product.

The churn rate can be measured daily, weekly, monthly, or annually. 

Churn rate = (No. of users lost / Total no. of users) X 100

For example, if you have 200 travelers who have been active in the last month and 15 stopped using your app this month, you would have a churn rate of 7.5%.

#3 Monthly active users (MAUs)

Monthly active users are the number of unique users who have used your app in the last 30 days. The term MAU is a measurement that helps you see how many people are using your app regularly, as opposed to a one-time user or another person who downloaded it but never used it.

#4 Daily active users (DAUs)

Daily active users are the number of unique users who open the app at least once on a given day. They measure engagement and popularity, as they directly relate to how often users use your app. The more DAUs you have, the higher your potential is for growth.

#5 Stickiness Ratio – DAU / MAU

The stickiness ratio is the number of daily active users (DAU) divided by the number of monthly active users (MAU), and it’s a measure of how engaged your users are with your app. The more sticky they are, the better you can understand their preferences and needs.

A high score indicates that users are engaged and you are the go-to travel app, while a low score suggests that there could be some friction points. It helps evaluate how likely the users are to remain loyal to the brand. 

App stickiness = Daily active users / Monthly active users X 100

#6 Abandonment Rate

The abandonment rate is the percentage of users who quit mid-way and do not complete an intended task. A reasonable abandonment rate is less than 10%. It is essential to track abandonment rates as a high abandonment rate indicates poor user interactions and missed booking opportunities.

Abandonment Rate = 1- Transactions completed / Transactions initiated * 100

If you have an average session length of 2 hours and 20 minutes, your abandonment rate would be 5%.

Session length: This metric measures how long each user spends using your app in a single session. The longer the session, the better engaged the user is.

To decrease the abandonment rate, ensure your app is easy to use by minimizing unnecessary steps and emphasizing what is most important in each step. 

Consider adding reward programs that encourage engagement with content like emails sent out by brands or discounts for completing specific tasks within the app.

#7 Conversion Rate

The conversion rate is the percentage of visitors who complete the desired action. This can be anything from booking a trip or purchasing an item to opening an email or downloading an app.  

A higher conversion rate indicates that more users find what they are looking for and complete the desired action. Most travel apps have multiple conversion types and report on them separately, so it’s essential to understand how each type affects your overall traffic and conversions.

Conversion rate = Total conversions / Total interactions

#8 Lifetime Value

The lifetime value is a critical metric that helps you determine the total value of all the revenue generated by a single user. It’s calculated by taking the number of users and multiplying it by their average annual revenue over their lifetime with your travel app.

The score indicates the total amount of money an individual user will bring in throughout their lifetime with your app. These calculations help determine how much time, effort, and money should be invested into acquiring new users versus retaining existing ones. 

LTV = Average value of conversion X Average number of conversions over some time X Average customer lifetime

#9 Net Promoter Score

NPS (Net Promoter Score) is user feedback that measures the user’s loyalty to your product or brand. There are two NPS questions you can ask your users:

1. How likely will you recommend our app to a friend or family?

2. What is the reason for your score?

The first question is always measured from 1-to 10 and is used to segment users based on answers. The second question gets feedback on the user’s high or low scores. Based on the responses to the first question, your users are divided into three different segments:

• Promoters – Users who answered the question with 9-10. This group is more than satisfied with your product and will be pleased to spread the positive word about it.
• Passives – Users who responded 7-8. This segment is satisfied enough with your product to use it. Usually, they will not churn, but they will also not promote it.
• Detractors – Users who replied 0-6. Detractors are users who will likely churn and spread negative words about your product.

The net promoter score measures the percentage of promoters minus the percentage of detractors. 

NPS = % promoters – % detractors

#10 Customer Satisfaction Score

Customer Satisfaction Score (CSAT) is a metric used to measure users’ satisfaction with travel apps. It is a crucial performance indicator frequently used to measure how happy users are with the services provided by your app. Asking the users to rate the app or their experience is a part of customer satisfaction surveys.

CSAT = Number of satisfied users / Number of survey responses X 100

Bottom Line

The best way to measure user engagement for your travel app is to find the metrics that best describe what you want to focus on and look at their trends. The data you collect from the metrics and overall engagement will help guide your decisions on how to change and improve your app experience for the users. 

High user engagement is the key to your app’s success! Analyzing the appropriate metrics, looking at their trends over time, and deciding based on results is the best way to measure your user engagement. This will help you build an engaging travel app that users love and get excited about.

The Upshot.ai Advantage

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