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The cost of acquiring new loyal gamers is on the rise. Referring users to other studios is one of the most effective ways for developers to monetize their games, but it’s also a major expense for new studios looking to gain traction. That’s going to continue, and the rich are just going to get richer, according to data-tracking firm Fiksu.
Each month, Fiksu releases an index that tracks the average cost to acquire a loyal user. In April, that number jumped 10 percent to $1.50 from $1.36 in March. Fiksu chief executive Micah Adler thinks this increase is attributable to a few forces working in conjunction.
“The industry’s smooth transition from Apple’s [unique device identifier] to its new [IdentifierForAdvertising], IDFA, actually kept traffic stable when it could have caused some disruption.”
In previous versions of Apple’s iOS mobile operating system, the company allowed advertisers to identify individuals using their unique UDID that is tied to iPhone and iPad hardware. Concerns about privacy prompted Apple to develop the IDFA specifically for cross-app marketers. This helps developers see who is installing apps and where they are coming from.
Some long-time ad networks worried a jump from one standard to another would cause some headaches, but the transition went smoothly. That helped maintain industry momentum.
Fiksu also revealed that more people were downloading games in April than in March. The firm tracks the install rates for the top 200 free iPhone apps in the United States. According to that index, iPhone users downloaded 5.61 million apps each day, which is up 11 percent from the previous month.
Adler thinks the industry avoided an even steeper cost increase thanks to Facebook’s mobile app.
“The rapid traction of Facebook mobile-app install ads may have provided developers with a greater pool of efficient inventory,” said Adler. “Consequently, [it] may have buffered the industry against even greater rises in costs.”
Developers didn’t have to fight over a few quality ad slots in popular games thanks to the Facebook app. Even still, these are the highest numbers for both user-acquisition costs and daily downloads since the post-holiday surge. It’s likely that costs will only continue to rise as we approach both a new iPhone and the gift-giving season.