What is a K-factor? 

In the realm of marketing, the K-factor serves as a gauge for an app's virality. It measures the strength of your app by factoring in the number of new users gained from existing users who have referred your app to friends and family.

How does a K-factor work?

When referral programs are an important element of their growth campaigns, app marketers will measure those results in order to determine the effectiveness of their grassroots efforts and track progress toward goals.

How to measure your K-factor:

This KPI is determined by multiplying the number of invitations sent by a customer, times the average number of conversions for each invite. An example of this would be if each new user invites an average of 2 friends to download your app…and every fifth invitee converts…the K-factor = 2 x ⅕ = 40%.

Why is a K-factor important to marketers?

The K-factor can help predict organic growth. Using the example above, 1000 new users will bring in another 400…and those 400 will bring in another 160…and so on. And if a paid campaign brings in another 10,000 new users, you can expect to see another 4,000 when your K-factor is 40%. It’s not a perfect measurement tool because word of mouth is very difficult to measure, but it does help marketers get a handle on organic growth as they try to reach their goals.

Who needs to know what a K-factor is:

• App marketing manager
• User acquisition manager
• App developer
• Digital marketing manager
• Performance marketing manager
• Affiliate manager
• Product manager
• Paid search specialist
• Marketing analys

Use K-factor in a sentence:

“The K-factor lends a clearer insight into how well your app’s built-in sharing capabilities are working and which incentives are motivating your existing users to recommend your app to friends and family.”