GTM Dictionary

The Go-to-Market Dictionary: Cost Per Install (CPI)

Learn about Cost Per Install (CPI) and how it can help you optimize your go-to-market strategy.

Welcome to The Go-to-Market Dictionary, where we shed light on industry terms and practices that can propel your business forward. In this edition, we will delve into Cost Per Install (CPI), a critical metric in app marketing that can make or break your campaign. Whether you're a seasoned marketing professional or a beginner, this guide will provide you with a comprehensive understanding of CPI and how to optimize it for maximum results.

Understanding Cost Per Install (CPI)

At its simplest, CPI is the cost an advertiser pays to acquire one app install. It is a popular metric for app marketers because it provides a tangible measure of how effective their campaigns are. A lower CPI means that you're able to acquire installs at a lower cost, which translates to higher profitability and potentially greater user acquisition. In contrast, a higher CPI can be problematic as it denotes more expensive user acquisition.

Definition and Importance of CPI

As mentioned earlier, CPI is a measure of user acquisition cost in the app marketing industry. App marketers use CPI to monitor the effectiveness of their campaigns and evaluate their return on investment (ROI). But what factors influence CPI and how can marketers optimize it to increase their chances of success?

One factor that affects CPI is the target audience. App marketers need to ensure that they're targeting the right audience for their app. This means that they need to understand their audience's demographics, interests and behaviors. By doing so, they can create targeted campaigns that are more likely to convert and result in a lower CPI.

Another factor that affects CPI is the ad format. App marketers need to choose the right ad format for their campaign. For example, if their goal is to increase app installs, they may want to consider using app install ads. These ads are designed specifically to encourage users to download the app and can be effective in reducing CPI.

Why is CPI important? Simply put, it helps app marketers determine the profitability of their campaigns. By determining the value of each install, marketers can make strategic decisions about their outreach plans. It's also relevant for app developers to determine whether they're able to sustain profitable user acquisition costs or not. Optimizing CPI can be a game-changer for app developers looking to grow their user base without breaking the bank.

How CPI Affects App Marketing Strategies

CPI is a critical metric for app marketers because it influences the marketing strategies they adopt. A low CPI indicates that their app marketing campaigns are budget-friendly, efficient and profitable. In contrast, a high CPI warns that app marketers need to re-evaluate their strategies to optimize their campaigns for better ROI. CPI incentivizes marketers to devise marketing strategies that are cost-effective and drive maximum user acquisition.

One strategy that app marketers can use to optimize CPI is to focus on organic user acquisition. Organic user acquisition refers to the process of acquiring users through non-paid channels, such as social media, search engines, and word-of-mouth. By focusing on organic user acquisition, app marketers can reduce their reliance on paid advertising, which can be expensive and result in a higher CPI.

CPI vs. Other App Marketing Metrics

While CPI is an important metric for app marketing, it's not the only metric that determines campaign effectiveness. Other metrics such as Cost Per Click (CPC) and Cost Per Action (CPA) are essential for app marketers to know and understand. CPC measures the cost advertisers pay when users click on their ad, while CPA is the measure of the cost to acquire a user who performs a specific action, such as making a purchase. While these metrics help assess the performance of app marketing campaigns, CPI is the most commonly used measurement of user acquisition.

In conclusion, CPI is a crucial metric for app marketers looking to optimize their campaigns for maximum user acquisition and profitability. By understanding the factors that influence CPI and adopting cost-effective marketing strategies, app marketers can reduce their CPI and achieve greater success in the highly competitive app market.

Calculating Cost Per Install

Calculating CPI is critical for marketers to determine the value of their marketing campaigns. Understanding the formula and how to calculate CPI can help marketers optimize their strategies for better ROI.

However, calculating CPI is just the beginning. There are many other factors that come into play when evaluating the success of a marketing campaign.

The Formula for CPI

The formula for CPI is simple: total cost of app advertising divided by the total number of app installs. For example, if you spent $500 on advertising and got 100 installs out of it, then your CPI would be $5 per install.

But what if your CPI is higher than you expected? This is where understanding the factors that influence CPI can help you optimize your campaigns for better results.

Factors Influencing CPI

Several factors influence CPI, including targeting, app design, ad creatives, ad placement and industry competition.

Targeting the right audience is key to reducing CPI. By identifying your ideal customer and tailoring your ad campaign to their needs and interests, you can increase the likelihood of conversions and decrease your CPI.

App design is also important. A well-designed app that is easy to use and navigate can increase user engagement and lead to more installs.

Ad creatives are another important factor. Eye-catching and engaging ads can capture the attention of potential customers and entice them to download your app.

Ad placement is also critical. Placing your ads in strategic locations where your target audience is likely to see them can increase the chances of conversions and decrease your CPI.

Finally, industry competition can also impact CPI. If your app is in a highly competitive industry, you may need to spend more on advertising to stand out from the crowd.

Industry Benchmarks and Averages

It's critical for app marketers to know the industry benchmarks and averages for CPI in their category. These benchmarks help evaluate the success of their campaigns by comparing it to industry standards.

For example, the average CPI for gaming apps is $2.73, while the average CPI for social media apps is $1.47. By knowing these benchmarks, you can set realistic goals for your campaign and adjust your strategy accordingly.

However, it's important to note that CPI is just one metric to consider when evaluating the success of your campaign. CPC, CPA, and other metrics can also be used in conjunction with CPI to determine campaign effectiveness.

In conclusion, calculating CPI is just the beginning of optimizing your marketing campaigns. By understanding the factors that influence CPI and industry benchmarks, you can develop a more effective strategy for better ROI.

Optimizing Your CPI

Optimizing CPI, or Cost Per Install, is a crucial aspect of any successful app marketing campaign. It requires a combination of tactics to lower user acquisition costs while increasing installs. Here are some tips to help you optimize your CPI:

Targeting the Right Audience

Effective targeting is key to reducing CPI. Careful consideration of your ideal user base helps to create better ad creatives and more efficient outreach that speaks to their needs, interests, and preferences. This means creating hyper-targeted campaigns that deliver the right message to the right user base and encourage them to take specific actions to install.

For example, if you have a fitness app, you might want to target users who have shown an interest in health and wellness or have downloaded similar apps in the past. By targeting users who are more likely to be interested in your app, you can reduce your CPI and improve your conversion rates.

A/B Testing Ad Creatives

A/B testing is an excellent way to see which ad creatives resonate with users and which ones need improvement. This process can be done by creating two separate ads with different elements such as copy, graphics, and call-to-action (CTA). By testing variables, app marketers can determine which ads perform better in terms of conversion.

For instance, you might create two ads with different headlines, one emphasizing the app's convenience and the other emphasizing its affordability. By testing these variables, you can determine which message resonates better with your target audience and adjust your campaign accordingly.

Leveraging App Store Optimization (ASO)

ASO is the practice of optimizing your app store page to improve visibility and ranking. By doing so, you can increase the likelihood of your app being found by users that are searching for the type of app you offer. This is an excellent way to reduce CPI since it increases organic traffic and improves the targeting of your app campaign.

Some strategies for ASO include optimizing your app's title, description, and keywords, as well as using high-quality screenshots and videos to showcase your app's features. By optimizing your app store page, you can improve your app's visibility, attract more users, and ultimately reduce your CPI.


Optimizing your CPI requires a combination of tactics, including effective targeting, A/B testing ad creatives, and leveraging ASO. By implementing these strategies, you can reduce your user acquisition costs while increasing installs and ultimately achieving your app marketing goals.

Analyzing CPI Performance

While optimizing CPI is critical, it's just as important to track and analyze performance over time. Here are some ways in which CPI performance can be analyzed.

Monitoring Key Performance Indicators (KPIs)

Monitoring key performance indicators such as CPI, retention rate, and lifetime value (LTV) are essential in evaluating the performance of your app marketing campaigns. These KPIs provide metrics that help app marketers monitor and track app install trends.

For example, tracking CPI can help you understand the cost of acquiring a new user. Retention rate, on the other hand, can provide insights into the quality of users acquired through your marketing campaigns. Meanwhile, LTV can help you determine how much revenue each user generates for your app over time.

Identifying Trends and Patterns

Analyzing CPI performance over time provides insights on trends and patterns that can inform decisions about a marketing campaign. Understanding how different factors such as targeting, ad creatives, ad placement and industry competition affect CPI can lead to better marketing decisions that optimize budget and improve user acquisition.

For instance, if you notice that CPI tends to spike during certain times of the year, you may want to adjust your marketing strategy accordingly. Alternatively, if you find that certain ad creatives consistently perform better than others, you can allocate more budget towards those ads to improve overall campaign performance.

Adjusting Your Marketing Strategy Based on CPI Data

Analyzing CPI data can help determine what works and what doesn't in your marketing campaign. Adjusting your marketing strategies based on CPI data can improve campaign effectiveness and reduce user acquisition costs.

For example, if you find that your CPI is consistently higher than industry benchmarks, you may want to adjust your targeting strategy to reach a more relevant audience. Alternatively, if you notice that certain ad placements consistently result in lower CPI, you may want to allocate more budget towards those placements to improve overall campaign performance.

Overall, analyzing CPI performance is crucial for optimizing app marketing campaigns. By monitoring KPIs, identifying trends and patterns, and adjusting your marketing strategy based on CPI data, you can improve user acquisition, reduce costs, and drive revenue growth for your app.


In conclusion, CPI is a critical metric in app marketing. Optimizing CPI requires a combination of strategies such as targeting the right audience, A/B testing ad creatives and leveraging ASO. Analyzing CPI performance over time is important to determine trends and make better marketing decisions. By implementing these strategies and monitoring performance, app marketers can optimize their campaigns for better ROI and user acquisition.