Goal setting for UA teams & measuring KPIs is always tricky business. Most companies are trying to set goals for the UA department to measure effectiveness and give bonuses to employees.
If you ask UA managers across the globe what is the goal they optimise against, D7 ROAS is going to be the most frequent answer.
This is a double edge sword, let’s take a look why:
7-day cohorts are matured enough, so we could say with decent confidence that a particular cohort is good or not. D1 and D3 metrics are, in most cases, too early to tell.
Not everybody necessarily understand how predictive modelling works, and it’s significantly easier to report on and optimise towards one metric.
Different UA channels have different LTV curves. Facebook D7 ROAS could be 20%, reaching 100% on D60. But on the other hand, Unity D7 ROAS could be 5% but 100% is already on D30 same with TikTok LTV curve. It can start slow on D7 with 10% but reaching 100% in D14.
If a company is looking to do UA at scale, it should never make decisions just based on one metric but try to understand the games they promote and how different marketing activities influence the User Acquisition performance.
All the learnings should be implemented in LTV modelling, and the UA team should work closely with product and data science teams to understand how each one of those impacts the performance.
So what should you do? I have no idea! Do whatever you want, but I can share what I usually do:
- create D1, D3, D7 ROAS benchmarks for each platform and UA channel (iOS is tough sure) which lead to 100% ROAS in your desired payback period
- measure & evaluate campaign performance against these benchmarks
- recalculate the benchmarks based on the current situation (seasonality, company cashflow issues, scaling, new game features, etc.)