iPhone 5 sells record 5 million units, but fails to ignite the same app marketing frenzy of the 4S

As was the case when the iPhone 4S launched, the excitement over the iPhone 5 has driven up iOS marketing costs, but not to the highs seen after the launch of the iPhone 4S according to user acquisition company Fiksu. Apple announced today the iPhone 5 was the fastest selling iPhone in history, with consumers picking up more than 5 million devices in three days, beating the 4 million units the iPhone 4S was able to shift during its first weekend of availability. Last year companies that specialized in iOS app marketing reported user acquisition costs roughly doubled during the iPhone 4S’ launch weekend, but this year marketers appear to have been more cautious. Craig Palli, Fiksu’s vice president of business development tells us that the cost of what the company calls “performance based media” -- i.e., advertising where the purchaser pays for a specific result, such as an install -- has increased by 10 to 30 percent for a typical app. While it is still too early to see if loyal user acquisition costs will be driven up by the iPhone 5 launch according to Palli, its important to note that last year’s rush of advertising didn’t actually equate to a permanent rise in advertising costs. Last year Fiksu reported that the cost to acquire a loyal iOS user was $1.47 in October 2011 (the month the iPhone 4S launched) -- down 10.4 percent from the $1.64 the company recorded in September 2011. While marketers haven’t been as enthusiastic about the latest iPhone, the adoption rate for iOS 6 shows no signs of slowing down. According to the latest numbers from cross-promotion service Chartboost, about five percent of iOS users are switching to the new operating system every day. Apple reports more than 100 million iOS devices are now running the latest version of the company’s mobile OS, a figure that translates to about 30 percent of all active devices according to Chartboost. The company reports more than 32 percent of all iPhones are now running iOS 6, followed by 27 percent of all iPads and 22 percent of all iPod Touches.

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iPhone 5 sells record 5 million units, but fails to ignite the same app marketing frenzy of the 4S

Kathleen De Vere

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Kathleen De Vere