Above: App inflation is on the rise.
Inflation is no fun. Especially when costs are rising more than what you can charge for something. That’s the problem facing app developers, based on the latest report by mobile marketing firm Fiksu.
During May, marketing costs rose 17 percent from April and 34 percent from a year ago, as measured in Fiksu’s Cost per Loyal User Index, which measures the cost of acquiring mobile users who open an app at least three times on iOS. That sets the stage for a competitive summer.
Fiksu’s App Store Competitive Index, which measures the aggregate daily download volume among the top 200 ranked apps, grew by 24 percent to 6.6 million, compared to April's 5.34 million. That’s a good sign, as it means the increased spending is having an affect on getting more users.
“With the increase in volume this month, app marketers will need to find more creative ways to find and acquire loyal users,” Fiksu said. “Granular targeting options and optimized app marketing efforts continue to improve, helping advertisers break through the noise.”
"While there have been ebbs and flows, it's very clear that the cost of app marketing and the competition for downloads is on a constant upward trajectory: what we're calling app inflation," said Micah Adler, CEO of Fiksu. "The increased quality and growing popularity of apps continues to fuel ever-increasing demand, meaning marketers must continually hone their new strategies and spending in the quest to cost-efficiently acquire loyal and engaged users."
Fiksu has accumulated more than 282 billion app actions, such as launches or registrations.
Above: Fiksu’s cost per loyal user index for May 2014
