What is Paid User Acquisition? The Ultimate Guide

Paid User acquisition campaigns

Developers and marketers face the daunting task of not only creating exceptional apps but also ensuring they reach their target audience. Reaching your desired audience directly can be challenging; to combat this, marketers will strategically use paid user acquisition.

If you’re asking yourself: What is paid user acquisition and how can you maximise it to achieve app success? then this post is for you.

Let’s get into it!

What is Paid User Acquisition

In the world of mobile marketing, paid user acquisition refers to the strategies and tactics used to acquire new users for mobile apps through paid advertising channels. Ideally, organic traffic would generate enough installs and engagement for an app to thrive, but the reality is apps often need that extra help to reach a wider audience and boost their presence in the app stores. This is where paid user acquisition comes into play, increasing installs, boosting visibility and accelerating growth.

Why is Paid User Acquisition Important?

Paid User Acquisition is a valuable part of the marketing function for several reasons:

  • Paid user acquisition campaigns allow app marketers to rise above the competition by reaching larger audiences.
  • Paid advertising channels help to attract the right users by allowing precise audience targeting which then supports data-backed optimisation and improvements.
  • Successful paid user acquisition campaigns can enhance organic growth by improving app ranking in the app stores.

Source: Wondery ASA Ad on the App Store, UK.

Utilising Paid User Acquisition Campaigns

There are five different scenarios where a business would need to invest in paid user acquisition campaigns:

1. When launching a new app: Paid user acquisition campaigns allow your app to gain immediate visibility in app stores, ensuring it reaches a wider audience from its release. The more installs you achieve from the start, the more data you’ll gather to understand user behaviour allowing you to optimise your app and future campaigns more effectively. If you want to learn more on how you can launch a successful app, we shared a comprehensive guide here.

2. To gain a competitive edge: 2023 ended with over  5.5 million apps in Apple’s App Store and the Google Play Store, so the competition within app stores is undeniably fierce. Paid user acquisition campaigns will improve your app discoverability, allowing you to rise above the noise and gain visibility amongst users who may not have discovered your app otherwise.

3. Targeted promotion: Paid user acquisition campaigns allow you to target specific demographics, interests, and behaviours, ensuring that the app’s promotional efforts are directed towards the most relevant audience segments likely to engage with the app.

4. Seasonal Marketing: During peak seasons or holidays, paid user acquisition campaigns can be used to promote apps with special discounts or promotions. This can increase visibility and align with the change in consumer behaviour based on different times of the year. You can also run limited-time campaigns with countdowns or expiration dates for promotional offers. Paid user acquisition campaigns can help you create a sense of urgency, encouraging users to take immediate action before the offer expires.  

Source: AppTweak

Choosing the Right Paid User Acquisition Strategy

App marketers have many different options when choosing paid user acquisition channels. Your strategy could involve going all in on a single channel, or it could involve diversifying your efforts. Choosing to diversify your efforts can maximise your app’s growth potential by reducing your reliance on a single source. Allowing your app to be exposed to different channels also exposes your app to a range of unique targeting options, reach and user behaviours simultaneously.

That said, where each acquisition channel comes with unique features, there may be a benefit in using a single source, especially if you are seeking to engage with a specific kind of user. Base this decision on the goals you’re seeking to achieve with your app. Whichever approach you decide to take, it is worth being aware of different paid user acquisition channels available for you to use.

Paid User Acquisition Channels

1. Search Ads: Search ads like Apple Search Ads allow you to display your app at the top or bottom of search engine results, reaching users actively searching for relevant keywords. This channel provides high visibility and targets users with specific intent who are more likely to convert. To get the best results from this channel, it is important to conduct thorough keyword research, write effective ad copy and consistently optimise your bids and targeting.

2. Social media ads: Social media platforms like Facebook, TikTok, Instagram, and Snapchat offer robust advertising capabilities, enabling precise audience targeting based on demographics, interests, and behaviours. This applies to iOS users who have opted in to personalised advertising (AppTrackingTransparency). This can give app owners lots of valuable data around conversion drivers and their most engaged audiences.

3. Display ads: Display ads are visual static or video creatives that appear on websites, apps, or other digital platforms. The versatility of display inventory allows for various ad formats, including static banners, rich media ads, and interactive overlays. Display ads are a great way to raise brand awareness and allow your app to reach potential users, particularly as you start to scale your campaigns.

4. Influencer marketing: Influencer marketing is an effective paid acquisition channel; particularly for targeting younger audiences such as Gen Z. Collaborating with relevant influencers in your app’s niche can help you tap into their dedicated audience and gain credibility. Influencers can promote your app through sponsored posts, videos, or reviews, leveraging their influence and reach.  To ensure success with influencer marketing, carefully select those you’d like to partner with, develop creative and engaging content, and track the performance of your campaigns.

Source: Apple

How to Measure Paid User Acquisition Costs

Cost Per Acquisition (CPA)

Analysing your Paid User Acquisition Costs (CPA) is key for measuring the success of your paid user acquisition campaigns. Calculating your CPA will allow you to understand how efficiently you are running your campaigns. For example, if you were to spend £1,000 on your paid user acquisition campaigns and obtain 100 users, then your CPA would be £10 per user.

As an app marketer, your aim is always to keep your CPA as low as possible. Where paid ads are involved, it’s about assessing which platform is the most efficient option for your campaigns.

Return on Ad Spend (ROAS)

Again, taking acquisition costs into account, as an app marketer, you should evaluate your return on ad spend (ROAS). This metric is calculated by dividing your total revenue by your attributed ad spend.

For example, if an ad campaign costs £10 per paying customer and generates £15 in revenue per paying customer within 90 days, your 90-Day ROAS would be £5 per customer. Your ideal payback period and expected return depend on factors such as app category, business goals, and app marketing channel(s) involved in your campaigns.

Paid User Acquisition Performance Tools

Tools such as the Google Play Console or App Store Connect, combined with specialist Mobile Measurement Partners (MMPs), will allow you to track the performance of your paid acquisition efforts effectively.  

Your app’s install count across different platforms will inform you directly of the growth rate of your app. Tools like those mentioned above will allow you to determine which of your downloads can be attributed to organic downloads or paid acquisition advertising. Understanding where your app’s growth is based will improve your strategy going forward. You’ll also want to look at the split between your organic and non-organic installs in depth.

Not only will this show you how to make the most of your marketing budget, but it will also help with channel optimisation. You can calculate the split by dividing the total number of non-organic installs over a defined period by the total number of installs during the same period.

For better post-install event tracking, you’ll want to use a Mobile Measurement Partner, (MMP), like AppsFlyer, Adjust or Branch. MMPs will help you track conversion from paid user acquisition campaigns and further down-funnel metrics, such as retention and engagement, to help evaluate campaign success.

Source: Google Play

Tips for Creating Successful Paid User Acquisition Campaigns

There may not be one set approach to your Paid User Acquisition campaigns, but there are general best practices that can frame and contribute to the success of your efforts.

Set clear goals: Create clear and specified achievable goals, relevant to your app that allow you to effectively measure your success.

Budget allocation: Allocate your budget wisely among different channels based on their performance and the potential ROI that each platform offers. Focus your choice of channels based on your goals and target audience.

Monitor KPIs: Keep a close eye on key performance indicators (KPIs) like conversion rate, cost per acquisition (CPA), and return on ad spend (ROAS).

Retargeting: Implement retargeting campaigns to re-engage users who showed initial interest but didn’t convert. Due to Apple’s privacy limitations post-iOS 14, retargeting activity is most effective in Android campaigns.

Localisation: Adapt your paid acquisition strategies for different regions and languages so that you’re able to cater to audiences on a personalised and global scale.

Continuous learning: Make a point to stay up-to-date and informed on industry trends and algorithm changes on advertising platforms. Evaluate platform growth trajectory and adoption rates. Look at the trends of each platform to anticipate future opportunities that could be aligned with your goals.

Hire an expert app marketing agency: App marketing agencies that specialise in offering holistic app marketing solutions like Yodel Mobile can provide extensive and precise solutions and strategies that can help you reach your target audience(s) and generate income for your business in the competitive mobile app landscape.

So, What is Paid User Acquisition?

Let’s revisit the question: What is Paid User Acquisition?

User Acquisition stands as a cornerstone of the success of holistic app marketing. Being able to strategically time your Paid User Acquisition campaigns and strategies, while adhering to best practices as you navigate the diverse landscape of paid media is no easy feat! It requires analytical minds, app marketing savviness and solid attention to detail.

We’ve happily shared a range of insights that we’ve gathered over the years in this area. If you’d like to benefit more directly from our expertise, feel free to reach out to us here and book your free app consultation.

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Smokehouse Yard, 44-46, St John Street, London, EC1M 4DF 🇬🇧