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.

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“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.