With over 5 million apps across the major app stores like the Apple App Store and Google Play Store, the app market is more competitive than ever. For app developers and marketers, a key metric to understand is the average cost per install (CPI) – that is, how much it costs on average to acquire a new user who downloads and installs your app. This metric helps determine the viability of user acquisition campaigns and provides insight into market trends.
What is Average CPI?
Average CPI refers to the average amount of money app marketers and developers pay to acquire a new user who installs their app. It encompasses all user acquisition costs, including ad spend on platforms like Facebook, Apple Search Ads, and Google AdWords. Average CPI is calculated by dividing total installation campaign costs by the number of installs:
Average CPI = Total Install Campaign Costs / Total Installs
For example, if an app marketer spent $5,000 on install campaigns and acquired 2,000 new app installs, the average CPI would be $5,000 / 2,000 installs = $2.50.
Average CPI provides a benchmark to understand the viability of paid user acquisition for an app. App marketers strive to keep average CPI low to efficiently scale install campaigns. Average CPI also allows comparison between apps in the same category and market.
What is a Good Average CPI?
There is no universal “good” average CPI, as it varies significantly based on factors like app category, platform, and market. However, according to data from Statista, the global average CPI across major app categories is around $1.50-$2.50 on iOS and $0.50-$1.50 on Android. Here are some benchmarks by category:
- Games: $1.40 (iOS), $0.60 (Android)
- Entertainment: $2.60 (iOS), $1.10 (Android)
- Photo & Video: $2.10 (iOS), $1.20 (Android)
- Social Networking: $3.60 (iOS), $1.80 (Android)
- Shopping: $1.70 (iOS), $0.90 (Android)
As a general rule, CPIs below $1.00 are considered very good, $1.00-$2.00 is average, and over $3.00 is high. However, these benchmarks vary over time with market conditions and campaign performance. App marketers should analyze historical averages specific to their niche and platform.
Average CPI by Geography
Average CPI varies significantly by country and region. Developed markets like the United States, Canada, Australia, Japan, and Western Europe have some of the highest average CPIs globally. Emerging markets, including much of Latin America, Southeast Asia, and the Middle East, offer lower average CPIs. Here are benchmarks by country and region:
| Country/Region | Avg. iOS CPI | Avg. Android CPI |
|---|---|---|
| United States | $3.70 | $2.10 |
| Canada | $3.00 | $1.80 |
| Western Europe | $2.80 | $1.60 |
| Australia | $2.40 | $1.30 |
| Japan | $3.10 | $1.90 |
| Latin America | $1.60 | $0.70 |
| Southeast Asia | $1.20 | $0.60 |
| Middle East | $1.80 | $0.90 |
Emerging markets have lower average CPIs due to lower costs of advertising and less competition from brand advertisers. However, they also have lower average revenue per user (ARPU), so app marketers need to factor in lifetime value when assessing CPI benchmarks.
Factors that Impact Average CPI
Many factors influence the average CPI for an app, including:
1. App Category
As the benchmarks above show, average CPI varies significantly between categories like games, social networking, ecommerce, and more. Game apps tend to have among the lowest average CPIs due to their viral growth potential, while highly competitive categories like social networking have higher averages.
2. Platform
Average CPIs are nearly always lower on Android than iOS globally, typically 40-60% less. The larger addressable audience on Android leads to greater supply of users and lower costs. However, monetization and engagement rates are also lower on Android.
3. Market
As noted above, average CPIs fluctuate substantially between geographies based on factors like purchasing power, platform usage, competitiveness, and advertising costs.
4. App Usage and Retention
Apps with higher usage and retention metrics can justify higher CPIs due to greater lifetime value of each acquired user. Stickier apps recoup acquisition costs over long lifetimes.
5. Ad Channel
Average CPIs can vary across user acquisition channels. For example, video ads and influencer marketing generally have higher CPIs than traditional digital channels like Facebook and search ads.
6. Competitiveness
In competitive categories like social, lifestyle, and gaming, user demand is finite so competitors bid up advertising costs, elevating average CPIs.
7. Ad Targeting
More granular ad targeting like interest/behavioral segments or retargeting tends to command higher average CPIs than broader targeting like age and gender.
8. Ad Creative and Landing Pages
Higher-performing, engaging ad creative and optimized landing pages improve conversion rates and lower average CPIs.
Current Mobile App Average CPI Trends
The average CPI for mobile app install campaigns has climbed over the past several years due to multiple factors:
- Increased competition for users’ attention, especially from digital disruptors
- Platform policy changes like iOS 14 that impacted targeting and measurement
- Reduced organic app visibility in app stores
- User acquisition saturation in developed markets
In 2021, the global average CPI rose around 30% across iOS and Android. This sharp increase means app marketers need to closely monitor performance and adjust bids to find efficiencies. Key trends include:
1. Diversification Beyond Facebook/Google
Due to rising costs and policy changes on Facebook and Google ad platforms, app marketers are diversifying spend across channels like Apple Search Ads, TikTok ads, Snapchat, ad networks, and more.
2. Increased Focus on Retention
With acquisition costs rising, marketers are focused on improving retention through tactics like product optimization, push notifications, email re-engagement, and referral programs.
3. More Targeting of Profitable Cohorts
Sophisticated marketers are getting more granular by targeting high-value users in specific geos and demographics usingcohort analysis and LTV modeling.
4. Shift to Measuring ROMI vs. CPI
Due to factors like SKAN and IDFA changes, many marketers are shifting focus from CPI to return on marketing investment (ROMI) to assess real business value of campaigns.
The Future of App UA and CPIs
Looking ahead, average CPIs for mobile app install campaigns will likely continue rising, forcing marketers to closely track performance and optimize for efficient growth. Here are some predictions for the future:
- CPI inflation to slow but remain elevated vs. historical levels
- Apple & Google privacy changes to further disrupt targeting and measurement
- Increased spend on retention campaigns to maximize LTV
- Emerging channels like TikTok to gain more app marketing budgets
- Higher focus on incremental value and ROMI vs. vanity metrics like CPI
Overall, the average CPI metric will remain important for mobile apps, but costs are becoming a secondary concern compared to actual business value delivered.
Key Takeaways
Here are some key points on current averages and trends in mobile app user acquisition costs:
- Global average CPIs range from $1.50-$2.50 on iOS and $0.50-$1.50 on Android depending on app category.
- Games have among the lowest average CPIs while competitive categories like social networking are higher.
- Emerging markets have lower average CPIs but also lower revenue potential per user.
- Many factors impact average CPIs including platform, competition, targeting, creatives, and channel mix.
- Average CPIs rose sharply in 2021 due to more competition and platform policy changes.
- Marketers are diversifying spend and focusing more on engagement and lifetime value.
- Average CPIs will likely remain elevated compared to historical levels.
Understanding the current average CPI benchmarks and trends across geos, categories, platforms, and channels is critical for running efficient and optimized mobile app install campaigns.
Conclusion
Average cost per install is a key metric for measuring the efficiency of user acquisition and marketing performance for mobile apps. While there are some general benchmarks for average CPIs, app marketers need to dig into specifics for their platform, geo, category, and channels to optimize ad spending and growth. With rising competition and platform policy changes, average CPIs are becoming less important than measuring real business value and return on ad spend. Sophisticated app marketers are taking a data-driven approach to identify high-value users and creatively engage them across channels. Although CPI inflation will likely persist, those focusing on the full user journey can build sustainable growth in the maturing mobile app ecosystem.