Cost Per Install or CPI is a pricing model used in mobile application marketing campaigns in which the company or person who created the app, pays an app marketer each time a new user installs their app.
There are a handful of different paid user acquisition models that app creators can choose from upon launching an app's advertising campaign. CPI or Cost Per Install, is one of the most popular in today's day and age.
The simple formula for calculating Cost Per Install (CPI) is as follows: Your total ad spend divided by a number of installs over a period of time.
The beauty of CPI campaigns is that the app creator/owner only pays the ad network once their app is installed, instead of just their ad being viewed (known as CPM, or cost-per mille model) or ad being clicked on (CPC, or cost per click model). As a mobile app creator/owner, your ultimate goal is likely installs, with CPI, the money you pay is directly for results. This also puts pressure on the ad networks to place the ads in apps or websites where conversion rates are high and audiences are hyper targeted.
Because CPI gives app creator/owners the direct result they're looking for, CPI is also significantly higher in cost than other models. If you're advertising an app itself and looking for installs as your main marketing/growth metric, CPI makes a lot of sense.
Average CPI will vary depending on the country, platform (iOS or Android), genre, and ad unit. As of the time of writing this (January 2022), the average CPI for iOS devices in the United States is $2.37, $0.98 in China, and $0.22 in Brazil, with Android apps at $0.44, and iOS $0.86 globally. Overall, the average global CPI in 2022 across platforms and countries is $2.24.
Yes and no. There is no doubt that mobile app downloads and installs aren't exploding like they once were in the mid 2010's. Individuals download fewer apps than they once did and open even fewer on a daily basis. For this reason, some mobile app marketing experts are challenging whether app installs alone is still a good metric for measuring how successful an app is. Considering that the most successful apps have moved towards free downloads and in-app transactions, they argue that you can't only rely on installs for measuring success.
All being said, CPI is still a great KPI and model for advertising apps if what you're advertising is the app itself. Some ad networks allow users to take the CPI model a step further by tying payout triggers to certain achievements in an app. When taking that approach, CPI is far more indictive of user engagement and success vs just downloading the app.
It really comes down to two things: market size and competition. Android is an open source technology and has managed to capture a much larger total percentage of the mobile device market share. In fact as of June 2021, Android controls nearly 73 percent share of the global mobile device market vs. Apple's 26%. This means that Android's market is nearly 300% larger than Apple iOS and thus, there is less competition for downloads on the Android side. Another interesting trend to note is that people who use iOS devices tend to spend more on apps than Android, there for app marketers are willing to pay more to acquire iOS users than they might with Android.
Social media sites are by far still the most common platforms/ad networks used today. The majority of all major social media companies provide advertising solutions for mobile apps, such as Reddit Ads, Pinterest Ads, Twitter Ads, Google Ads, Snapchat Ads, TikTok Ads, and LinkedIn Ads just to name a few of the big ones.
Our biggest advice here is to do some research into where your target users/customers exist today. If you're building an social networking app for a niche audience of B2B salespeople, maybe LinkedIn makes sense...if you're building a mobile game, Facebook might be your best bet. It really just comes down to preference, rates, and most importantly where your target audience exists.