“We had more than 1000 answers in one day using Survicate's NPS surveys. We redirected those who gave us 9 or 10 to leave a rating online. We went from 4.2 to 4.8 on Trustpilot.”
“We had more than 1000 answers in one day using Survicate's NPS surveys. We redirected those who gave us 9 or 10 to leave a rating online. We went from 4.2 to 4.8 on Trustpilot.”
Robin Tussiot
CRM Manager at Kard
EFFORTLESS SURVEYS
Run multi-channel customer feedback surveys in a snap
“Survicate integration capabilities are great and that’s a big part of the appeal. And the platform itself is very innovative and it’s so easy to set up surveys.”
“The targeting aspect of product surveys, the number of question types to choose and customizable attributes make Survicate the best survey tool I've ever used.”
In a world that's speeding towards digital dominance, competition to win app user acquisition is like a 100-meter dash on steroids. Every click counts, and each acquisition can be as pivotal as Usain Bolt's split-second victory at the 2008 Olympic Games.
Let's break it down.
Understanding app user acquisition cost is essential to staying competitive in 2024. Failing to grasp it will leave you panting at the starting line while your competitors sprint past you.
Yes, it's game-changing.
With our guide, you'll gain knowledge of cost factors and strategies, and arm yourself with actionable insights to keep pace with the ever-evolving mobile app market race. Let's start running 🏃
Table of contents
What is mobile app user acquisition cost?
Understanding how much it costs to get new users for your mobile app is crucial for success. This cost affects your app's marketing and budget. We will look at what this cost means, why it's important, and what changes it to help you plan better and spend wisely.
The foundation of any successful mobile app is how well it attracts, captures, and retains users. The app user acquisition cost is right at the heart of it, but refers purely to the financial investment needed to gain a new app user. It includes marketing campaigns, ad placement, collaborations, and more.
Easy to understand in concept, hard to execute in application. The key is to invest just enough to hook new users but not so much you bleed your resources dry. One wrong calculation and the cost could kill an app’s profitability.
Remember, the user acquisition cost captures more than just the cost of acquiring users; it's a mirror of your app’s market value. A high acquisition cost may be a warning sign of lower-than-expected app popularity or a lackluster marketing strategy.
Why is app user acquisition cost important?
Monitoring User Acquisition Cost (UAC) is essential for crafting a successful mobile app marketing strategy. This key metric reveals the profitability and financial health of your app.
When UAC is low, it means your marketing efforts are hitting the mark, effectively attracting your target audience with a strong value proposition and efficient outreach. This efficiency fosters steady growth, allowing you to gain new users without overspending.
However, a high UAC can be a red flag, indicating potential financial strain and the need for a reevaluation of your marketing strategies or app features. Keeping UAC in check ensures your app remains competitive and financially sustainable, ultimately contributing to its long-term success.
What influences app user acquisition cost ⤵️
Several factors can impact app User Acquisition Cost. User behavior, market trends, competition, app popularity, and marketing strategies all play a role in determining how much it costs to acquire new users.
Simply knowing these factors isn't enough. The key is to leverage these insights to develop a targeted and effective marketing strategy. By doing so, you can significantly lower your acquisition costs while boosting your app's popularity and profitability.
How to calculate Customer Acquisition Cost (CAC) for your mobile app?
Calculating Customer Acquisition Cost (CAC) is crucial for effectively managing your app's growth. This process involves understanding how to allocate resources efficiently to attract new users. Mobile user acquisition strategy delves into the nuances of monitoring your investment in user acquisition and evaluating the effectiveness of your strategies.
To calculate CAC, you need to divide the total costs spent on user acquisition by the number of new users acquired during a specific period. This includes all marketing and sales expenses. By mastering this calculation, you gain valuable insights that help you make informed decisions, ensuring your app's sustainable growth without unnecessary complexity.
Step 1: Identify the costs involved
Start with a clear tally of all the expenses involved in acquiring a user for your mobile app. This may include costs associated with marketing campaigns, advertising, wages of marketers, and any other costs directly linked to attracting new users. Detailed record-keeping here will set the stage for precise CAC calculations, enabling effective budget management and careful expenditure tracking.
Step 2: Calculate the total number of acquired app users
This step requires a granular understanding of your user sources. You should analyze each mobile user acquisition channel—be it social media, SEO, referrals, or in-app advertising—and note down the number of new users it brings in. Tracking user sources will not only feed into CAC calculations but can also offer insights into the most and least effective channels, guiding future marketing strategies.
WHen you know your costs and the number of new users your product attracts, calculating the CAC becomes a simple division operation — the total cost of acquisition divided by the total number of new users acquired. Although straightforward, the significance of CAC shouldn’t be underestimated.
It's a key mobile app metric that directly influences profitability and growth. A high CAC could signal inefficiencies in your marketing strategies, whereas a too-low CAC might mean missed opportunities for expansion.
Remember, no company's CAC is identical to another's, but having an understanding of industry standards can help set realistic goals and expectations. Stay on top of your CAC, and you can ensure the financial health and longevity of your app.
Effective Mobile App User Acquisition Strategies to Lower Your CAC
Let's now explore ways to reduce the cost of acquiring new users for your app. This section of our guide focuses on how improving your app's discoverability through SEO and ASO can attract users inexpensively. It also examines the paid user acquisition strategy and highlights how leveraging social media can promote your app widely at minimal cost.
Organic user acquisition strategy: Search Engine and App Store Optimization
One of the most cost-effective ways to be visible and attract users is through organic user acquisition tactics such as SEO and ASO.
SEO sounds more suited for the web, doesn't it? The truth is, the app world isn't isolated. People routinely search for apps on Google or other search engines. Hence, SEO is surprisingly relevant even in the mobile app business. A well-optimized website can divert traffic toward your app, thus expanding your user base at a fraction of the cost.
ASO, on the other hand, is the SEO of the app world. It enhances the visibility of your app in app stores and increases your app downloads. It is an underappreciated yet potent method to pull organic traffic at a cost significantly lower than paid ads. The stronger your ASO, the lower your CAC.
Paid user acquisition strategy
While organic mobile app user acquisition optimizes costs, it doesn't exactly hold the speed record. Enter paid media marketing. It accelerates app downloads but can be pricier.
Broadly, paid user acquisition models are categorized into Cost Per Install (CPI), Cost Per Action (CPA), and Cost Per View (CPV).
While CPI focuses on gaining app installs, CPA and CPV are geared towards getting the user to perform specific actions and view ads, respectively. Each lends a unique spin to user acquisition with different cost implications. Weighing the pros and cons can help choose the right mix.
Viral user acquisition strategy
Few things rival the power of virality, especially when it comes to app user acquisition. Virality doesn't necessarily happen by chance; it can be tactically built into your app for an encouragingly low CAC.
Social media platforms foster an environment ripe for going viral. Striking a chord with audiences can catalyze an avalanche of downloads. But how to achieve it?
That’s where captivating content, incentivized sharing, and smart targeting come into play. A comprehensive viral strategy enhances app discoverability and user acquisition without burdening the pocket.
User retention to reduce app user acquisition cost
Keeping users engaged with your app is key to reducing the costs of acquiring new ones. Retaining existing users is not only cheaper but also results in higher returns on investment. Loyal users are more likely to convert, upgrade, and refer new users, driving revenue growth.
Think of user retention as a measure of your app's "stickiness"—the more users return, the more attractive and engaging your app is.
How to improve user retention?
Improving user retention doesn't have to be daunting. Here are some effective strategies:
Gamification: Introduce game-like elements such as rewards, points, or leaderboards to motivate users to keep coming back.
How to measure user retention rate?
Calculate the retention rate by dividing the number of users at the end of a period (excluding new users) by the number at the beginning, then multiply by 100. This metric should be considered alongside others like daily active users, churn rate, and session length to get a complete picture.
Taxfix's user retention success story
Retaining user attention in a market brimming with similar apps isn't easy. However, Taxfix has shown remarkable success in this area, managing to keep its users coming back for more.
Taxfix’s success story lies in its ability to proactively engage with users through personalized messages, functioning as a significant advantage. To achieve this, the CRM team employed a series of Survicate's in-app mobile surveys to collect user feedback and target the audience better.
With the main NPS question, Taxfix is able to assess user sentiment toward the app, while additional questions help in segmentation to target users with relevant content and information.
Remember to consider the specifics of your audience demographics when applying these strategies. Every app's user base is unique, and your user retention strategies should reflect this.
Future trends in app user acquisition cost
As technology advances, the approach to attracting users for mobile apps is also transforming. Let's explore how these changes impact the cost of bringing in new users. We'll look at how tech developments affect acquisition costs, how strategies for getting users are evolving, and what the future might hold for marketing apps. Staying ahead of these trends is key to keeping your app competitive in the rapidly changing digital landscape.
Impact of technology on CAC
The landscape for mobile apps’ CAC is undergoing enormous changes, largely driven by technological advancement. Artificial Intelligence (AI), data analytics, and predictive modeling serve as cornerstones for transforming the app ecosystem.
AI is shaping how businesses target potential app users, leading to cost-effective strategies. Predictive analytics powered by AI has made targeting more precise, reducing the CPC (cost per click) and CPA (cost per acquisition).
With the increasing use of programmatic advertising, companies can automate the buying process, securing ad inventories at optimal prices. This efficiency may lead to a potential reduction in CAC.
Building on the shoulder of data analytics, businesses can segment audiences and personalize campaigns on granular levels. Personalized strategies can lead to higher conversion rates, effectively reducing the CAC.
What may change in user acquisition strategies?
Understanding the shifting sands of user acquisition strategies can help brands to adapt better. A key development is the escalated importance of user experience (UX). As app markets mature, consumers' expectations rise - a stellar UX design is no longer optional.
Brands are increasingly putting emphasis on organic user acquisition, which builds trust and leads to higher customer lifetime value (CLTV), therefore reducing the long-term CAC. Word-of-mouth marketing, social media advocacy, and quality content creation are becoming essential for organic growth.
Another predicted trend is the more strategic use of freemium models and in-app purchases (IAPs). Offering new users a freemium app increases downloads and its conversion to paid subscriptions or IAPs, potentially lowering the overall CAC.
The future of mobile app marketing
App marketing will increasingly thrive on data and analytics, offering the trifecta of personalization, immediacy, and contextualization. Future apps will deliver more tailored content, guide new users through in-app experiences, and leverage behavioral data for continuous improvement.
Location-based marketing could also play a critical role in reducing CAC. By geotargeting audiences, brands can enhance user engagement and conversion rates.
Overall, the future of mobile app marketing implies an integrated approach leveraging technology, data insights, and a user-centric mindset to conquer the challenges of higher user acquisition costs.
Keeping pace with the pack
Without a doubt, App User Acquisition Cost (UA cost) is a pivotal metric in the success of any app. Navigating through the complexities of changing app markets, the impact of quality user base on UA cost, and optimizing strategies in 2024 can lead to game-changing profitability in the digital business landscape.
This information, when applied correctly, can help position your app for sustainable growth. Applying these actionable insights could be the difference between stagnation and soaring downloads.
Moving forward, the challenge lies in how adept you are at maximizing the user value while optimizing your UA cost. Here's a thought starter – How could AI and machine learning elevate your app’s user acquisition strategies?
Never forget, the curve never lags—it only leads, and that's where the opportunities hide. So stay ahead, stay in the game, and let the app downloads do the talking.
Aldona is a Content Manager whose ultimate goal is to make reading blog posts fun again, not compromising on the knowledge-sharing part. She’s enchanted with how feedback can change your perspective and loves spreading her findings on the Survicate blog. As an inquisitive soul, she often interviews Survicate users to create one-of-a-kind customer success stories. Find her on LinkedIn and say hi!
.webp)
.svg)
.svg)
.svg)
.svg)
.svg)
-min.webp)
.svg){kind=icon}
.svg)
.svg)
.svg)
.svg)
.svg){kind=icon}
.svg)
.svg)
.svg)
.svg)
