The 2012 holidays marked a turning point for mobile marketing, with significant growth in mobile devices, app downloads, and shopping conducted via smartphones and tablets. On Christmas Day, 17.4 million iOS and Android devices and tablets were unwrapped and activated – breaking the 2011 record by more than 2.5x. So it’s no surprise that we saw a spike in app downloads in December.

The December Fiksu App Store Competitive Index increased to 5.32 million daily downloads in December, up 16 percent from November’s 4.57 million. As expected, competition around the holiday increased, though not as dramatically as it did during 2011. Part of this is likely due to the absence of robotic install tactics that were still being employed during the previous holiday season. Volume also fell slightly short of the massive October peak caused by the introduction of the iPhone 5.

Meanwhile, the Fiksu Cost per Loyal User Index jumped 21 percent, or 29 cents, to $1.67, from November’s $1.38. While costs continued to climb from November to December, as expected, the 2012 holiday season presented a steadier, more cost-effective landscape than the 2011 season, as marketers implemented best practices they’d learned and tested throughout the year.

Mobile app marketers are a year older and wiser, and we saw this reflected in the December Indexes. Unlike the spending frenzy we saw in 2011, many opted for a value-versus-volume approach in 2012, collectively applying a more conservative, sophisticated strategy to their Q4 campaigns and largely avoiding big gambles on a long App Store freeze. This value-based approach also led to a “long-tail” effect, where more marketing dollars were spent on apps outside of the top 200 that are tracked in our index. Read more in our analysis here.

A big thank you to all the publications for covering our December Indexes: Appnewser, BizReport, Inside Mobile Apps, Mobile Marketing Magazine, Mobile Marketing Watch, PocketGamer.biz and VentureBeat. 

History has shown us the arrival of a new mobile device generates remarkable opportunities for app marketers to cost-effectively acquire and engage new users, as download volumes surge, costs to acquire loyal users plummet, and user-interest levels peak. So it was no surprise the much-anticipated arrival of the iPhone 5 in September prompted some interesting dynamics in the Fiksu Indexes. While the App Store Competitive Index didn’t depict a huge month-over-month change in download volumes, in reality there was a whirlwind of activity taking place beneath the surface.

Specifically, by examining the data from before the iPhone 5’s arrival and afterward, we identified a clear distinction in app download activity. In the weeks prior to the phone's launch, downloads decreased by 3 percent, but in the weeks after, downloads swelled by a substantial 33 percent.

Meanwhile, the Fiksu Cost per Loyal User Index for September was among the lowest on record at $1.13, down 21 cents or 16 percent from August’s $1.34. The last time the Cost per Loyal User Index came close to this was May 2011, when it was $1.10, as a result of Apple’s ban on incentive-based installs, followed by January 2012 when it fell to $1.14 after the holiday advertising craze.

What does this all mean? Opportunity with a capital O! For app marketers, the iPhone 5 launch in September delivered a prime chance to cost-effectively acquire large volumes of loyal users. In fact, one of our clients even experienced a 20 percent increase in organic downloads and 35 percent revenue gains during the iPhone 5’s post-launch period. Many other clients were able to take advantage of the traffic jump.  

As the iPad Mini hits shelves, we may see a continuation of this wave. However, we expect September’s bargain period of rich marketing opportunities will likely be unmatched until the post-holiday frenzy in January 2013.

A big thank you to all the publications that covered our September Indexes, including AppNewser, FierceMobileContent, Inside Mobile Apps, Marketing Vox, MediaPost, Mobile Marketing Watch and Mobile World Live.

Venture capital investments in mobile have boomed this year, reaching levels not seen since 2001. For thrill-seekers hoping to hit the jackpot and “win big,” new smartphone and tablet apps are providing Las Vegas-style gambling options – with real money – at the swipe of an index finger. And following a series of leaks and rumors, Google Play will now offer gift cards for its content-distribution store.

Mobile now represents a staggering 46 percent of all VC investments, with venture backing for mobile consumer apps totaling nearly $4 billion during the first six months of 2012, according to new data from M&A advisor firm Rutberg & Company. During this time, VCs invested in 479 mobile startups, with the median funding round size netting at $3.5 million. “The six-month mobile investment total represents the highest level of activity for a half-year period since the firm initiated coverage in 2001 – in addition, 2012 mobile investments are currently $1 billion ahead of the pace set during the first half of 2011, which was the largest year for mobile tech venture funding in a decade,” reports Jason Ankeny in FierceMobileContent.

Juniper Research estimates that by 2017 consumers will gamble $100 billion on their mobile devices. Game developers have recognized this huge market opportunity and are starting to convert smartphones into virtual casinos – and up the ante by adding real-money bets. In the U.K., where it is legal, Big Fish Games Inc. will soon introduce a version of its gambling app Big Fish Casino with real-money betting, Bloomberg reports. “This is the biggest opportunity that game developers have had since the advent of the Internet,” Christopher Griffin, chief executive officer of Betable, said in his recent Bloomberg interview. While in-app gambling with real money isn’t yet cleared in the U.S., gaming giant Zynga is lobbying hard because the company has plans of its own to launch real-money gaming products in the first half of 2013, according to reports in the The Wall Street Journal.

After months of speculation and increasing user demands, Google Play gift cards are officially expected to hit U.S. retailers in the next few weeks, reports Engadget. The gift cards will be available in $10, $25 and $50 denominations, and users can redeem them for just about any digital content in the Play Store. These new cards represent Google’s latest step toward a “full-fledged content store," helping Google to compete with the popular Apple's iTunes gift cards and others in the physical retail store market, according to The Verge.

Writes Thomas Hazlett for the Wall Street Journal: "On June 29, 2007, thousands of fan-boys and-girls camped in long lines to inhale a wisp of sweet techno fairy dust. The new iPhone rocked the world. Revolutionary in design, function and ecosystem, it set off the mobile data tsunami. In three days, Apple sold a million of them."

Since that day, the world has never been the same. As we celebrate the iPhone's five year anniversary today, we're reminded of just how much the device has rocked the world and shaped so many aspects of modern culture. In fact, The Atlantic recently pegged the iPhone as the "defining consumer item of its age."

Apple's iPhone undoubtedly sparked the mobile app revolution and burgeoning ecosystem, which has inspired entrepreneurs and developers around the globe, added an estimated 500,000 jobs in the U.S. alone and delighted consumers with more than 650,000 apps in the Apple App Store. But all of those mobile apps are vying for the spotlight – making mobile marketers' jobs increasingly difficult as each month goes by.

Mobile app success – and monetization - requires more than smart and broad mobile media buying. It takes app store smarts, and no one understands and analyzes the dynamics of the app stores quite like Fiksu. For more than one year, our Fiksu Indexes have tracked monthly fluctuations in competition for rank in the Apple App Store, and the cost to acquire loyal users (defined as someone who opens an app three or more times), to help mobile app marketers benchmark their performance against industry averages. In fact, we just released data for the month of May – check out the news release.

To illustrate the ebbs and flows in app store dynamics and mobile app marketing costs over the course of 12 months, we've created the following infographic. It highlights many of the major industry trends that have rocked the world of mobile app marketing along the way, including Apple's ban on incentive-based installs, the iPhone 4S launch, the flurry of activity around the 2011 holiday season and the move away from robotic install tactics.

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