Chart of the Week

Are CPI costs really rising?

Yes, but it depends on the UA channel

Are CPI costs really rising?

The underlining assumption in the world of user acquisition is that buying an install for your game or app is becoming increasing expensive.

Indeed, it's now so expensive to run such campaigns that some marketing people say you need a minimum of $250,000 to properly launch a F2P game.

So what to make of UA company Fiksu's graph for the changing cost of CPI for games during 2014?

Sure there are plenty of peaks and troughs, but for both Android and iOS, we can see that price of an install was the same or less during December than during January.

Costs during 2014 look flat

There was only one thing to do - ask?

Data, data

As is often the case, the answer was another graph - this time showing what Fiksu calls the 'cost per loyal user' or the cost of buying an install that will result in that user launching your game or app at least three times.

(We can think of it as an equivalent but enhanced CPI cost.)

Once again we can see the peaks and trough as dictated by market conditions. However, the addition of a trend line shows us the underlining situation.

The underlying trend is up

Yes, the costs of buying users are rising - roughly up 50 percent over two years.

Devil and the detail

Glenn Kiladis, SVP of New Media Solutions at Fiksu, provided further explanation.

"Our CPI Indexes include the full spectrum of advertising sources, from expensive traffic like Facebook to lower-cost incentivized traffic, to better reflect the overall industry picture," he said

"CPI measures that don't include incent (incentivised traffic) are going to show more significant increases."

In this context, Fiksu has found that some traffic sources - those that can provide high quality users - are becoming more expensive, while a general move to real-time bidding systems which use an automatic AI approach to buying traffic (programmatic UA) is reducing prices.

Equally, seasonal issues are important.

"In December specifically, games CPIs fell as few games made the big holiday push of years past," Kiladis notes.

So, in conclusion, although there are different trends in different channels, the overall trend is that the cost of buying users - especially high quality users - continues to rise, just not always month-on-month.

Contributing Editor

A Pocket Gamer co-founder, Jon is Contributing Editor at which means he acts like a slightly confused uncle who's forgotten where he's left his glasses. As well as letters and cameras, he likes imaginary numbers and legumes.