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by kevingibbon
4818 days ago
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Lets say you need 20k DLs to get top 5 in a notable category. Lets say you get another 20k of real DLs from the app store ranking. Incentivised DLs are $0.35 each, but they are Dls and not real users. So $7k for 20k DLs. You usually want a LTV of 3:1. So your LTV would need to be $2.10 per user. These users are way worse than acquiring them from other channels because they only briefly see your logo and a brief description. Let's say they are only 25% as good. So now you need a regular LTV of $8.40. Very few apps have a LTV of over a dollar. |
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The ratio - 20K real downloads from 20K incentivized, or 1:1 - is also a bad assumption. Here the actual ratio varies wildly, depending on how much the incentivized installs actually influence your app ranking. It's a feast or famine situation - spend too little, and your ratio will be closer to 1:10, since your ranking won't have moved enough to influence organic traffic. Spend sufficiently, and your ratio will be closer to 10:1, if not higher.
The LTV of 3:1 is also a bad assumption - I've worked with firms who would spend at breakeven all day long, often because they wanted to grow their user base into an acquisition or use it for future in-house cross-promotion. Many others are happy to make (say) $1.50 on $1.00 spend.
My experience agrees with the parent comment - anyone that has the budget to buy incentivized downloads does buy incentivized downloads, except for a small proportion of developers who strongly disagree with the practice. It simply works too well.