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The iPhone 5 Caused a Spike in Downloads After a Mild Depression, and User Acquisition Costs Decreased

Back in September, Fiksu released a report with their predictions for how the iPhone 5 was going to impact app marketing. Now that the iPhone 5 is out, Fiksu has released a report on how the release of the phone impacted the market, and with their projections available, it’s possible to see how their projections panned out.

App downloads were only up on a marginal basis from August, increasing to 4.07 million downloads of the top 200 ranked free iPhone apps in the US from 4.05 million. However, that doesn’t tell the whole story: downloads dipped before the iPhone 5 launch, and once it was released, the total number of downloads increased by 33 percent for the rest of the month. So October could prove to be a bigger boon for developers that released their apps with the iPhone 5′s continued rollout and the iPod touch 5th generation’s release, and November similarly with iPad Mini sales.

While the downloads were largely stagnant, app marketing costs took a downward turn as well. Fiksu’s cost per loyal user index indicates that the cost of acquiring a user who opens an app three or more times fell to $1.13 in September from $1.34 the month before. In fact, this is the lowest total since January 2012′s $1.14 total, and is just above the May 2011 amount of $1.10, after incentivized installs were banned by Apple. This price decrease should continue through October, as from September to November 2011, this CPLU went from $1.64 to $1.47 to $1.43.

In fact, this seems to show that there is a seasonal effect in app marketing costs: when a new iPhone comes out, the demand for new apps to use on the phone makes it easier to acquire new users who will return to the app. Fiksu also claims that one developer using their analytics saw an increase in organic downloads by 20% coupled with a revenue gain of 35%.

So far, it does appear that the iPhone 5′s release is having the kind of impact that Fiksu predicted it would have, with an increase an app downloads and decreases in marketing costs. For developers looking to strike it rich with their apps, this is the prime time to strike.

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Carter Dotson
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