Cost Per Install (CPI)
What is Cost per Install?
Cost per install (CPI) is the term that describes the pricing model of mobile user acquisition (UA) efforts to drive installations. CPI is specific to mobile apps. To increase an app’s exposure, a digital advert will be placed on a channel like FB, Snapchat, Google or other mobile ad networks, and, depending on the cost model utilized, each time a user taps on the ad/installs their app from the ad, a cost is incurred.
It’s calculated as follows: Cost of ad (expenditure) divided by the number of installs the ad was able to generate.
CPI = total ad spend / total installs
Why Cost per Install is Important?
CPI is one of the most important metrics to track the efficiency of a mobile advertising budget and how many installs it’s possible to drive with X amount of dollars.
To improve audience exposure and enjoy the benefits of reaching new audiences, paid ad campaigns are a key component of an app marketing strategy in targeting high-quality audiences.
Let’s talk about Facebook which is one of the popular channels advertisers use for their paid ad campaigns and explains why CPI is important. A global issue overall but largely on Facebook is that there’s an ongoing competition for inventory which is the amount of mobile app advertising space that a channel has available to sell. The demand for advertising grows faster than the supply (inventory) does. As a result, ad space becomes more desirable. Because the cost to advertise increases by the nature of supply and demand, the CPI increases too.
This only highlights the importance of tracking CPI in order to manage that increase as best one can, which is done by optimizing the following:
- the ad’s creative performance
- tap through rate
- and App Store conversion rate (CVR) for paid traffic which has a direct effect on CPI.
Cost per Install and ASO
A UA Manager should always be looking for ways to improve Return on Ad Spend (ROAS), but the process can be complemented via ASO techniques. ASO and UA form a fundamental basis for an app/game’s marketing strategy. The teams can combine their activities to optimize every paid ad campaign that’s run, in an effort to improve growth.
By bringing in ASO experts it’s possible to decrease the CPI, sometimes dramatically. Based on the analyses of over 500M users, Storemaven has a deep understanding of how users respond to the creatives they see on the App Store just after they were exposed to the ad creative and tapped on the ad.
From A/B testing it’s possible to identify the most successful App Store marketing assets so UA teams can increase app store conversion rates, lower the CPIs, build a data-driven, successful ad campaign that both optimizes CVR for paid traffic and boosts marketing ROI.