App-store competition is on the rise and it’s harder — and costlier — than ever to market your app and retain users over the long haul.
With competition in the iOS app store soaring, Android offers app marketers a good deal — the cost-per-install on Android is about 27% less than it is on iOS.
Holding on to users after they’ve installed an app is even more expensive than getting a user to install it in the first place. The majority of apps lose about half their peak audience after three months.
Acquiring a loyal user on iOS through paid means rose to $2.16 in October, according to Fiksu’s Cost Per Loyal User Index
Here are a few key data points on user behavior and a selection of recommended marketing strategies from the report:
- Per-capita downloads are stalling: US app users downloaded an average of 8.8 apps per month during 2014. But, that’s nearly identical to the average monthly download volume three years ago.
- Encouraging retention and usage remain challenging: In June 2014, the average user spent about 70% of app time in their three most-frequently-used apps. About 52% of all apps lose at least half of their peak users after three months.
- The cost of acquiring and retaining users is soaring. The iOS and Google Play app stores are overcrowded, and competition to stand out is at an all-time high. The cost-per-install on iOS soared 59% year over year in October, while the cost to retain a loyal user — defined as a user who opens the app at least three times in a two-week period — is even higher than acquiring a new one, and was up 33% year over year.
- User retention tips: Developers should focus on marketing their apps just ahead of major new phone or operating-system launches. App-marketing costs go up after a new device launches, because lots of apps are competing for the attention of consumers downloading apps to new phones. Apps that are top of mind among users when they first get their phone are likely to retain an advantage, without paying a premium for post-launch promotion.
- The rise of app-install ads: App-install ads have become a popular way to drive new downloads while other app-store optimization (ASO) tactics can help increase visibility through unpaid means. We detail these, and other strategies.
- To retain users who already have an app, in-app messages and offers are often effective. For example, a gaming app might push a user a message offering them a one-time deal on extra lives so they will continue playing.