User acquisition costs up 26% in February after January’s drop, Fiksu finds

Getting those people to download your app doesn’t come cheaply.

The cost to secure a loyal user for a mobile app was $3.50 in February, according to marketing technology company Fiksu. That is up 26 percent from January, which itself was the first month the price to acquire a new user went down — falling 34 percent from December to $2.78 — for the first time in a year. The mobile gaming market is a $34.8 billion dollar industry, according to market research firm Newzoo, but it’s easier for companies to make profits when it’s cheaper to acquire new users.

“The reality is that in an increasingly crowded mobile market, sustained app engagement is progressively more difficult,” Fiksu noted in a press release sent to GamesBeat. “So January’s data represented a notable break for advertisers, particularly following the historically expensive holiday months. In the meantime, app download volumes decreased slightly during February, falling 3 percent, while Android and iOS CPI (cost per install) declined 4 and 5 percent, respectively.”

Fiksu also noted that the majority of smartphone users will only spend their time in a small number of apps, so it’s important for developers to know who they should target for advertising.