Benchmarking app store competitiveness & the cost of mobile app marketing
The Cost per App Launch Index, which tracks the cost of each repeat app launch over time, focuses on engagement and life-time value of mobile users. In June, the Android index stayed steady at $0.10; representing an 8 percent increase year-over-year. The iOS Index decreased 10 percent to $0.18 – a 16 percent increase year-over-year.
The Cost per Install (CPI) Index measures the cost per app install directly attributed to advertising. June saw the CPI for iOS fall by 23 percent to $0.98 in May – a 21 percent increase year-over-year. For iOS games, this was even more pronounced as CPI dropped to $0.85 compared to May’s $1.11. Android’s CPI increased in June by 7 percent, representing a 71 percent increase year-over-year.
The App Store Competitive Index tracks the aggregate volume of downloads per day achieved by the top 200 ranked free iPhone apps in the U.S. In June, the Index saw an 8 percent drop to 6.1 million daily downloads from May’s 6.6 million - looking at June 2013, this represents an increase of 9 percent year-over-year.
The Cost per Loyal User Index measures the cost of acquiring a loyal user for brands who proactively market their apps. For the purposes of the Index, loyal users are defined as people who open an app three times or more. In June, the Index continued its steep upward trajectory from May, rising 25 percent to $2.23 – a 49 percent increase year-over-year; and reaching its highest point in the four-year history of the Fiksu Indexes.
Fiksu's Analysis: June 2014
June illustrated a costly month for app marketers, as the Cost Per Loyal User (CPLU) Index breached its highest point in the history of the Indexes, reaching $2.23 – representing a 25 percent increase over May and 49 percent year-over-year. Overall, the Index numbers continue to demonstrate that it is becoming harder and more expensive than ever for brands and app developers to capture and retain loyal users.
June’s peak high in loyal user costs can be attributed to a couple drivers. While the cost of advertising actually decreased, consumers were opting for choices beyond their mobile devices during the summer months, including being captivated by the World Cup and, as a result, there was less discovery and usage of new apps from organic users. These organic users are frequently the most loyal, and with this marked reduction, the Cost Per Loyal User increased significantly in June.
In addition to the fact that mobile app users were otherwise occupied during the summer months was the fact that Apple briefly re-evaluated its policy for rewarding consumers who watch videos, causing advertisers to temporarily cutback on video advertising. With this effective, low-cost avenue to reach loyal users impacted, overall costs to acquire loyal users increased.
While the cost of a loyal user is on the rise, Cost Per Install declined in June, particularly for gaming apps. The Fiksu CPI Index for iOS plummeted to $0.98, down 23 percent from May. For iOS games, CPI dropped even further to $0.85 from May’s $1.11.
On the Android side however, CPI actually showed an increase of 7 percent over May and 70 percent year-over-year. These ever-increasing CPI rates on Android may be attributed to higher demand as more marketers expand their marketing dollars beyond iOS.
The App Store Competitive Index, which measures aggregate daily download volume among the top 200 ranked apps, dropped from May’s 6.6M to 6.1M. As mentioned, this data suggests that users were turning their attention during the summer months to other things outside of downloading and using apps.
For the breakdown on what happened last month, check out the May Index.
How can the Fiksu Indexes help you?
Mobile marketing shouldn’t require guesswork. Our award-winning Fiksu Programmatic Mobile Demand Platform injects predictability into your campaigns, removing complexity and guesswork and shifting the focus to where it belongs: performance.
We’ve accumulated more than 350 billion mobile app actions to-date – including launches, registrations, and in-app purchases, as well as real-time bidding requests – and use this data to help you better understand the fluctuating dynamics of the complex app marketing landscape through our monthly Fiksu Indexes.
Your app is competing for users with more than a million others. The best way to improve your mobile marketing is to more precisely understand the competitive landscape you’re pouring your budget into. The Fiksu Indexes reveal how industry dynamics – such as iOS upgrades, device launches, advertiser demand, ad network/publisher inventory, and seasonal activity – impact your business goals. Armed with this insight, you can adapt and plan with more agility.