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App Marketing Costs Hit All-time High

Posted on 8.05.2014

It's getting more expensive to market apps. Data from a new report out from Fiksu, which just so happens to provide app marketing technology, indicates there's a correlation between the cost of marketing and the App Store Competitive Index, which tracks the aggregate volume of downloads for the 200 most popular free iOS apps. 

The Boston-based firm has been analyzing trends in app marketing for the last four years, and in June of this year, released the Cost Per Loyal User Index (CPLUI) — which measures how much money brands spend to acquire regular users of their iOS apps — peaked at $2.23. 

This summer, however, the number of downloads was even lower than usual: 6.1 million in June, versus 6.6 million in May. June also marked the first time the CPLUI was higher than $2, a 25% increase from May and a 49% increase from last year. Craig Palli, chief strategy officer at Fiksu, attributed that to the popularity of the World Cup and Apple's temporary ban on apps with incentivized video advertising.

While the cost of a loyal user continues to 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.

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