As is the case every year, in 2023 the scene of mobile app marketing has changed and evolved. New apps are developed continuously, and that will not change in 2024.
It is very important to remember that every app category has different implications to the mobile app marketing campaign required to promote it, not only in terms of the most suitable ads for it, but also with regard to the cost employed during user acquisition.
A key concept in the Cost Per Install pricing model is that, very often, different mobile app categories have different CPI, and that depends on several factors that we are going to explain.
- What is Cost Per Install in mobile app marketing
- The variations of CPI across mobile app categories
- CPI by app categories: some data to remember for 2024
Cost Per Install (CPI) is a commonly used pricing model in mobile app marketing, where advertisers pay a predetermined amount for each installation of their app. This model is particularly attractive for app developers because it directly ties advertising costs to measurable user acquisition.
We have already talked about the pros and cons of CPI at length in this article.
The category of the mobile app plays a major role in determining CPI. Different app categories have different levels of competition, target audiences, and user acquisition costs.
For instance, highly competitive categories like mobile games and dating apps often have a higher CPI due to the fierce competition for user acquisition and engagement. On the other hand, app categories like shopping and ride-hailing, where user acquisition is comparatively easier, may have a lower CPI.
The reasons behind these variations of CPI in mobile app marketing are multifaceted. For popular categories, the high demand for user attention results in increased advertising costs. Moreover, the life-time value (LTV) of a user, influenced by factors like engagement and in-app purchases (IAPs), can also impact CPI.
Generally, CPI is influenced by apps that prioritize down-the-funnel events, meaning in-app purchases. These apps tend to incur higher costs due to their emphasis on driving users deeper into the conversion funnel.
Shopping and ride-hailing apps show a lower CPI, mainly because their monetization is nearly instantaneous: users often make purchases or transactions shortly after installing these apps, contributing to a more cost-effective user acquisition process.
Subscription-based apps, such as dating apps, display higher CPI. This phenomenon may be attributed to their freemium model, where users are lured with free features but encounter higher costs for premium subscription services.
Fintech apps and mobile games generally exhibit higher CPI. However, within these categories, there are significant ranges of variation. Hyper-casual games, for instance, tend to have a lower CPI compared to strategy games. Similarly, among fintech apps, those focused on trading and cryptocurrencies may have a monetization structure linked to the volume of transactions users execute, which translates in a higher CPI.
The highest CPI of all is usually associated with betting apps, primarily due to their monetization model based on user deposits and their value. Moreover, the monetization of these apps is not constant: just to give an example, betting on sport events can obviously be done when there are such sport events to bet on, reason why the down-the-funnel monetization of these apps becomes a bit unpredictable.
To sum these concepts up, we could say that apps that features an almost instant monetization are the ones with lower CPIs; on the other hand, apps that are mainly built on the exploit of in-app purchases, either subscriptions or other kinds of event, present a higher CPI, because their monetization window can be longer and they need some sort of early and robust investments to acquire users that can secure a higher Life-Time Value.
As expected, the variations of CPI across different categories can be explained by considering several factors.
- CPI in mobile games
The high CPI for mobile games reflects the intense competition in this category, the most diverse in mobile app marketing. Mobile gaming apps often require significant advertising budgets to stand out in a crowded market.
- CPI in fintech apps
Fintech apps have a moderate CPI, which also reflects the specialized nature of the audience. While the competition is not as fierce as in gaming, advertisers need to target a specific user base with financial interests.
- CPI in shopping apps
The relatively low CPI for shopping apps suggests that users are more readily inclined to install such apps. This could be due to the practical utility associated with shopping apps.
- CPI in ride-hailing apps
Similar to shopping apps, ride-hailing apps have a lower CPI, possibly because of the essential service they provide and the broad appeal to a diverse audience.
- CPI in dating apps
The notably high CPI for dating apps underscores the competitive landscape of mobile app marketing and the focus placed on acquiring users for platforms heavily reliant on user interaction.
- CPI in betting apps
Betting apps command the highest CPI in mobile app marketing, likely due to strict advertising regulations, niche audience targeting, and the potential for high customer Life-Time Value.
Understanding these CPI variations in mobile app marketing is crucial for advertisers. In fact, by basing on the unique dynamics of each app category, they become able to allocate their budgets effectively and optimize their user acquisition strategies.