Cost Per Install (CPI): A Key Metric to O Mobile Acquisition

What is CPI and How is it Calculated?

CPI (Cost Per Install) is a pricing model in mobile advertising. It’s the amount an advertiser pays an ad network or publisher each time a user installs the app after seeing or interacting with an ad.

CPI Formula

Cost per install is calculated by dividing the total ad spend by the total number of installs generated by the campaign.

Example

• Total ad spend: €5,000
• Number of installs: 2,500
• CPI = €5,000 / 2,500 = €2

If your CPI is too high, it can hurt the profitability of your acquisition strategy, requiring adjustments in your marketing efforts. On the flip side, if your CPI is too low, you might be acquiring  lower-quality users (e.g., low engagement, low retention rates, etc.).

What factors influence CPI?

Cost per install isn’t a static figure, it varies depending on several factors: market, platform, app type, and even the time of year. Understanding these elements allows you to anticipate fluctuations and optimize campaigns accordingly.

Country and Region

The CPI can vary greatly depending on where you’re targeting. In markets with high competition and strong purchasing power (like the US and Western Europe), bidding wars raise acquisition costs. On the other hand, regions like Latin America or Southeast Asia often see lower CPI due to less advertising saturation and lower purchasing power.

Example CPI Benchmarks by Region

• Latin America : $0.50 – $2.00
• North American : $2.50 – $5.00

Source: Business of Apps

OS (iOS vs Android)

CPI also varies between platforms. iOS tends to be more expensive than Android since iOS users are considered more valuable and more advertisers target them. However, costs can still differ depending on the specific market and user segment.

Source: Appsflyer

App Vertical

Different app categories come with different acquisition costs. A hyper-casual game, for example, usually has a lower cost per install due to its massive user base and large-scale acquisition efforts. In contrast, a fintech or dating app targets a smaller, often harder-to-convert audience, which increases acquisition costs.

Acquisition Channel

The platform you choose for your advertising also directly impacts CPI. Networks like Meta and Google Ads usually have higher CPIs due to intense competition. Other platforms may offer lower acquisition costs, but this depends on the targeting precision and audience type.

Examples of average cost per install by channel

Source: Business of apps

Seasonality

CPI can fluctuate throughout the year. During peak periods like Black Friday, Christmas, or sales seasons, competition spikes, and bidding increases. Conversely, quieter times like the summer often see lower CPIs as fewer advertisers are active.

CPI vs Other KPIs in User Acquisition

Cost per install alone isn’t enough to evaluate a strategy’s success. To truly gauge campaign profitability, CPI should be considered alongside other KPIs for a complete picture of campaign performance.

 

CPI vs CPA (Cost Per Action)

CPA measures the cost of an action after the install, such as a sign-up, adding to a cart, or making a purchase. Unlike CPI, which only counts installs, CPA helps you see if users are truly engaging and taking valuable actions inside the app.

Why Does It Matter?

• A low CPI can be misleading if users aren’t performing valuable actions after installation.
• On the other hand, a higher CPI could be justified if users are more likely to convert.

Example :

• An e-commerce app has a CPI of €3 and a CPA (for first purchase) of €15.
• It optimizes its campaigns and drops its CPI to €1.5, but its CPA rises to €30.
• Result: The cost of acquiring a buyer doubles, making the campaign less profitable.

CPI vs ROAS (Return on Ad Spend)

ROAS measures how much revenue is generated in comparison to your ad spend. A low cost per install doesn’t guarantee a good ROAS if users don’t make purchases or generate significant value after the install.

Why Does it Matter?

• A low CPI doesn’t cut it if users aren’t spending within the app.
• A higher CPI can still be worthwhile if users generate more revenue.

Example :

• A gaming app invests €10,000 for 5,000 installs (CPI = €2).
• 10% of users make an in-app purchase, generating €15,000 in revenue.
• ROAS = 1.5 (a 50% ROI) → The campaign is profitable despite a higher CPI.

CPI vs LTV (Lifetime Value)

LTV measures the total value a user generates over their entire lifetime in the app. Comparing cost per install to LTV helps you understand whether an acquisition is profitable in the long run.

Why Does It Matter ?

• If CPI exceeds LTV, the campaign is unprofitable.
• If CPI is lower than LTV, it’s a profitable campaign that can be scaled.

Example :

• A streaming app acquires users at €4 CPI.
• Those users generate an average LTV of €12 over six months.
• Result: The margin is enough to justify the ad spend.

How to Reduce CPI While Maintaining User Quality

Reducing CPI without compromising user quality is a key challenge in user acquisition. The goal isn’t just to reduce costs, it’s to get valuable users who are likely to engage and convert.

Here are some approaches to consider:

1. Test and Optimize Ad Creatives

Ad creatives play a direct role in CPI. A well-crafted ad can grab attention, boost conversion rates, and reduce CPI.

• Test multiple formats: short videos, UGC (User Generated Content), carousels, etc.
• Optimize CTAs to increase click-through rates.
• Run A/B tests to identify top-performing visuals.

To find out more, read our article on Creative Testing.

2. Optimize Ad Targeting

Too broad targeting generates unnecessary volume, while too narrow targeting raises cost per install. The key is balancing quality and volume.

• Use lookalike audiences to reach users similar to your best customers.
• Exclude underperforming segments to avoid wasting budget.
• Adjust based on data like device, location, and usage patterns.

3. Optimize ASO (App Store Optimization)

A strong ASO strategy can help increase your app’s conversion rate on the stores, automatically lowering cost per install.

• Optimize product pages: title, description, and keywords to increase visibility.
• Improve visuals: icons, screenshots, and videos can significantly impact install rates.
• Encourage positive reviews and ratings to boost credibility and conversion.

4. Diversify Acquisition Sources

Relying on just one platform can be risky. Test multiple platforms and formats to optimize your cost and reduce risk.

• Test several platforms: Meta Ads, Google Ads, TikTok, DSPs…
• Try new formats: stories, rewarded videos, in-app ads, etc.
• Continuously analyze and adjust: the best channel today might not be the best tomorrow.

Conclusion

Cost per install is an essential metric in mobile user acquisition, but it isn’t enough on its own to determine campaign profitability. It needs to be optimized without sacrificing the quality of users acquired. High-performing creatives, targeted ad strategies, solid ASO, and diversified acquisition channels are the key factors to balancing cost and value. The goal is to reduce CPI while ensuring every euro spent brings in users who are truly engaging and profitable.