Mobile Gaming And Apps Marketing Costs Show Widening Gap, Says Fiksu

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mobile-challengeEven as the cost of acquiring a new app user grows, mobile app analytics firm Fiksu has noted major fluctuations between gaming apps and general apps, as well as iOS vs. Android apps.

According to Fiksu’s new Cost Per Install (CPI) Index, which measures the cost per app install attributed to advertising, the CPI Index for Android was between $1 and $1.30 on average for most of 2013 before jumping up to $1.80 in December. It then dropped 29% to $1.27 in January.

In comparison, iOS CPIs were generally between $0.85 and $1 all year, and increased just 13% in January to $1.01 from December’s $0.88.

Further analysis showed that the bulk of the December spike in Android CPIs was driven by non-game apps. Fiksu attributed these results to two factors: Incentivized traffic (rewarding users in exchange for an action on the app) has historically led to greater visibility in the App Store, but not so much in Google Play, and game marketers typically employ incentivized techniques more often than general apps marketers.

In other words, the costs for general Android apps increased as developers spent more on additional sources of installs, such as traditional display channels.

Fiksu also introduced a metric designed to measure the value app marketers are getting from their ad spend in terms of engagement, which it is calling the Cost Per App Launch Index.

The Cost Per App Launch (the total marketing spend for an app, divided by the number of times the app was launched by users acquired through the marketing campaign) for January was $0.16 on both Android and iOS devices.

This is the first time app engagement costs on both platforms has converged since February 2013, in which iOS costs were typically higher than Android. The convergence was most likely due to a “post-holiday correction” following brands’ large campaign budgets for the holidays, according to the report.

The report also broke down the cost per launch of games vs. apps during the holidays. For Android, the cost per launch for game marketers dropped 34% between October and December. General app marketers on Android however, saw that metric increase 162%, suggesting that users were more receptive to gaming apps.

IOS apps also showed a difference in games and apps performance. The cost per app launch on iOS games remained relatively steady throughout 2013 at about $0.15. In comparison, general apps dropped from a high of about $0.35 during Q1 through most of the year, despite a few spikes between Q3 and Q4, notably around the launch of the iPhone 5s and 5c.

Apple is rumored to be launching interstitial video iAds that will automatically play within iPhone and iPad apps. It remains unclear how Apple will sell the new video iAds, but install and engagement costs are likely to increase, as developers experiment with the new ad unit.

In terms of trends, Steve Bagdasarian, VP of business development and strategy at Fiksu, said he expected to see more uses of push notifications across both iOS and Android apps, specifically, “the use of data segmentation to understand the user base, and more targeted use of in-app tools such as push to deliver precise re-engagement messages.”

Bagdasarian  also noted that deep linking is becoming more common as a way to increase engagement levels by directing users to new content in an app or other specific areas.

However, deep linking “isn't an instant turnkey solution,” he added, “as it does require engineering work to implement, so adoption may be faster in some verticals, like games, than others, like large brands.”

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