The cost to acquire loyal users dropped in July, while the cost per install index (CPI) rose, showing “more focused audience targeting” is in play, app marketing company Fiksu said.
The changes reflect “narrow targeting activity from advertisers” and shows their willingness to absorb higher costs in order to be visible to relevant audiences, the company said.
The report found that app downloads decreased by 10 per cent over the last month to 7.5 million daily downloads, according to the App Store Competitive Index, which tracks the average aggregate daily downloads of the top 200 free iOS apps (click image below to enlarge).
The report defines loyal users as those who open an app three times or more while the CPI Index measures the cost per app install directly attributed to advertising.
The cost per loyal user (CPLU) of $2.98 in July represents a decrease of 7 per cent since June, and a 51 per cent increase year-over-year (click image below to enlarge).
On iOS, CPI increased to $1.43, a rise of 24 per cent since June and an increase of 16 per cent since last year, while on Android, CPI rose to $2.73, up 29 per cent since last month and 115 per cent year over year.
“Taken together, the decrease in CPLU and increase in CPI suggest that marketers are spending more to target the right audiences and this is ultimately proving effective in acquiring valuable long-term users,” the report observed.
“July’s results reveal the most important metric that marketers should be focusing on: the cost to acquire a loyal user. This month is indicative of what it looks like when marketers spend smarter,” said Micah Adler, CEO of Fiksu.
“We can see month over month that marketers are still getting accustomed to this shift in audience targeting; but they are beginning to realise the power of putting the right messages in front of the right people at the right time,” he added.
Looking forward, with the iOS 9 launch and new iPhones expected in the first few weeks of September, it will be a competitive time for advertisers, the report noted.
“To prepare for the transition, this month will be a good time to initiate re-engagement with existing users to ensure your app is not removed or replaced,” Fiksu suggested.