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 was down 8 percent since last month, falling to $3.21 in March and up 4 percent 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. Downloads decreased 7 percent since last month, falling to 7.6 million daily downloads. Year-over-year, the volume was down by 11 percent.
Fiksu’s Analysis: March 2016
The hype around app downloads appears to be slowing, according to the March indexes. This was apparent from the marked decrease in both download volume and costs. The App Store Competitive Index showed that downloads fell 7 percent since February to 7.6 million daily downloads while costs followed suit, declining 8 percent since February to $3.21. That’s close to costs from last year at this time, which were only 4 percent lower than this March.
The drop in download volumes indicates that, while the app landscape is still growing, it&’s nearing saturation, and users aren’t necessarily populating their devices with more apps. In fact, comScore data shows that most people don’t download apps on a monthly basis anymore. This means a shift in how marketers reach their target audiences.
That’s why an important adjustment has happened this month in the indexes – we are retiring the Cost Per Install (CPI) Index. The days of focusing on cost per install metrics are over. We believe is CPI is no longer a good gauge of an apps’ success: targeting, tactics, and competition in specific categories can dramatically shift CPI for any one app campaign.
In today’s mature app market, mobile marketers need to focus on acquiring the right app users rather than accruing high volumes of app installs. Honing in on relevant audiences who may have already shown interest in a brand – and segmenting lookalike audiences to those users – are a marketers’ best tools to fuel app growth in the future. Smart marketers will be the ones who measure against the lifetime value of a user, not the install, and are willing to spend different amounts for users that have different lifetime values.
For the breakdown on what happened last month, check out the February Index.