The Cost per Loyal User Index measures the cost of acquiring a loyal user for brands who actively market their apps. For the purposes of the Index, loyal users are defined as people who open an app three times or more. The CPLU Index dropped 34 percent since last month, falling to $2.78 in January. That’s a 4 percent drop 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. The Index rose 4 percent in January, reaching 8.8 million daily downloads, however volume was down 15 percent year-over-year.
The Cost per Install (CPI) Index measures the cost per app install directly attributed to advertising. On iOS, CPI rose 28 percent to $1.88, a 47 percent increase year-over-year. On Android, CPI fell to $2.42, a 27 percent decrease since December and an increase of 58 percent since last year.
Fiksu’s Analysis: January 2016
Ringing in the New Year and coming off the busy holiday season, January download volumes increased 4 percent from December to 8.8 million daily downloads. However, while there was a definite rise in usage from December to January, spending was reeled in a bit, giving marketers the opportunity to more cost effectively reach their target audiences. In fact, the cost to acquire a loyal user (CPLU) dropped 34 percent from December – coming in at just $2.78. These results are indicative of what the mobile marketing environment looks like when marketers ease spending and users are still aggressively downloading apps. Additionally, this download volume ‘peak’ from December to January wasn’t as pronounced as it has been in years’ past, suggestive of an increasingly maturing app market with fewer first-time device owners.
In terms of the Cost Per Install (CPI), costs on Android demonstrated a typical supply and demand situation with the decrease in post-holiday spend, falling 27 percent since December, to $2.42. This dip ended the streak (five consecutive months) of doubling last year’s CPI figures, but overall costs were up 58 percent from a year ago – validating the fact that marketers still see tremendous value on Android.
In complete contrast, CPI on iOS moved in the opposite direction of Android up 28 percent month-over-month to $1.88. Much of this increase was a result of the use of incentivized channels. Unlike, the Google Play Store, incent plays a bigger role in the activity seen in the App Store. In December marketers were throwing ad spend into incentivized channels during the holidays to reach higher App Store ranks – keeping CPI prices lower. In January, however, that incent spending decreased with the conclusion of the holiday app rank competition – pushing costs upwards.
Moving ahead, with speculation around Apple’s release of several new devices in the coming months, competition will be on an upward trajectory for marketers. New devices will spark increased App Store activity and marketers will need to work hard to acquire those new, loyal users.
For the breakdown on what happened last month, check out the December Index.