The iPhone 5 has been a massive boon for app discovery according to Fiksu. The Boston-based user acquisition and marketing company reports that app downloads spiked by 33 percent after the release of the highly anticipated device.
The company reports new iPhone 5 owners pushed the volume of daily free app downloads from the U.S. app store sky high, rising from 4.07 million in September to 5.4 million in October, a 33 percent jump that was clearly linked to the iPhone 5.
Although the company saw only a marginal increase in overall download volume during September, Fiksu recorded an upswing in free downloads that began on Sept. 21, the day the iPhone 5 launched. Last month Fiksu reported free app downloads in the U.S. increased by 33 percent after Sept. 21, a pace that the iOS store was able to maintain throughout October.
The company also reported that the cost to acquire a loyal iOS user — defined as one who will open an app at least three times — fell for the third month in a row, dropping to $1.06 in October. According to Fiksu CEO Micah Adler, the popularity of the iPhone 5 was a major factor in the shift, as new device owners searched for apps to install.
“Organic searches soared as users around the world actively explored the App Store searching out new apps for their new iPhones. This heightened period of organic discovery – coupled with peak download volumes – drove down the cost of loyal user acquisition,” he explained.
While we’re still hearing complaints from developers about the cost of mobile user acquisition, Fiksu’s latest report could signal relief is in sight — good news for the industry.
High user acquisition costs make it much harder for app developers to break even on marketing costs, since the more a company spends to bring on a set of new users, the more unlikely it is the company will be able to break even unless they are able to effectively monetize a large portion of the acquired users. The high cost of user acquisition has lead to a new wave of cross-promotion networks and prompted TinyCo to create its own affiliate network in an effort to cut down marketing costs.