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The cost of getting new users to try out mobile apps is getting more and more expensive, hitting an all-time high on the Apple App Store in December.
The rush to promote mobile apps during the Christmas holidays caused mobile advertising costs as well as app downloads to peak, according to an index maintained by mobile ad firm Fiksu.
Boston-based Fiksu measures the cost of attaining a loyal user, or one who opens an app at least three times. In December, the index rose to $1.81 per user, up from $1.43 per user in November.
Apple froze the rankings of its App store between Dec. 25 to Dec. 28, causing a mad rush to promote apps via mobile advertising before that lock-in period.
Meanwhile, the Fiksu App Store Competitive Index (which measures the average daily download volume of the top 200 free U.S. iPhone apps) hit a peak of 6.04 million daily downloads in December, up 7 percent from November’s 5.65 million, the previous high.
Micah Adler, chief executive of Fiksu, said the month of December is a “strategically critical month for app discovery.”
“What we witnessed during the month was a ‘land rush’ in which advertisers earnestly spent marketing dollars in order to achieve ranking before the traditional App Store freeze which then would generate substantial organic downloads through increased visibility,” he said.
Advertisers spent heavily to drive up their app rankings, particularly in the last half of December. Traffic and dollars spent in the final week of December increased 100 percent over prior weeks. Fiksu tracks data from 11 billion mobile app actions, such as app launches, registrations and in-app purchases.
A big reason the download numbers were higher was due to the fact that Apple sold a record 37 million iPhone during the fourth quarter, and Android phone sales were also huge. On Christmas day, more than 6.8 million new iOS and Android devices were activated.