Is $2 too much for an App install?

Gamesbeat reported today that prices for users are on the rise again. And it’s hitting devs like a hurricane. Many of my UA friends will agree with me, that the fiksu methodology to determine the price may be questionable but none will disagree with the trend. Prices are indeed on the rise.

fiksu

So is $2 too much for an install? If you have done paid acquisition in mobile, you will probably answer the question with: “Yes, too much”.
And you will be happy that you have found a few sources that deliver you high quality players at a slightly lower price than the chart indicates. Overall you work hard to keep things going but it feels like you were Sisyphus.
Competition is heating up. The new phones offer new opportunities to get an app installed and things are gearing up for the holidays. On top of that, people are installing less and less apps. So there is more competition than ever. And Android has become almost as expensive as iOS in many countries.

With all that in mind… even if there may be many reasons – I do think that $2 is too much. But how much is too much?

Different games can afford different costs to acquire a user. But what should the price for an install be?

Actually the pure value of somebody installing your free app is zero, nada, nothing. It’s on the phone of the user and it’s been opened (if you agreed to pay for the open). That’s it.

There is no engagement, no ad impressions, no in-app purchases. Sure – the pure install can help you to boost your ranking position and then – hopefully – you will get enough actual players from the organic installs. But that’s it.

Only if the install comes from a well targeted user a good percentage of users will start engaging with your app. So you have built a model that determines what that percentage should be and how these users should behave. Good.

A few years ago, cost per install was almost unknown. People were paying for fraudulent clicks and impressions that often didn’t even happen. So obviously we were looking for less risky ways to do advertising. Today it is a very common method to charge/pay for installs. And game developers and publishers are happy with this. Well – it seems better than the alternatives.

I just don’t think it’s good enough: Why have we let the advertising industry come to the point of charging for nothing of value – on a “cost per install” basis.

I’m sure there are a lot of initiatives to prevent developers being hit like a hurricane, so we can continue to see awesome games being published on mobile in 2015 and beyond.