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Mobile app marketing costs : How to plan your app marketing budget

Mobile app Marketing Costs : How to plan your app Marketing budget 

Today the total number of mobile apps is passing 5.5 million and, at the same time mobile users use only a handful of apps regularly. This competition continues to grow rapidly. In this environment, app marketing costs constitute a bulk of a brand’s marketing expenses. Many app developers struggle to get their apps discovered on the app stores and get them connected with mobile users.

 There are many costs you need to keep in mind while developing an app. It will become a big problem if the users don’t know about the existence of your app. It is necessary to allocate adequate funds for your marketing strategy.

but do not worry, this guide will help you to understand everything about marketing costs for mobile apps. 

 

Cost of marketing an app 

Unfortunately, there is no single amount that can be considered.  Some app marketers spend a very small amount while others spend in millions, the remaining fall somewhere between the middle. It is not wise to spend more money on app marketing, exceptional results can not be gained just by pouring money.  You can get away with an affordable marketing strategy for your app as long as your strategies are effective. You need to focus on your CPI i.e. cost per install. This is a key app marketing metric that helps you to measure exactly how much each installation costs you. 

Be smart about your marketing cost by tracking this CPI, it will help you to understand whether your strategies are working or not. 

 

Importance of setting an App Marketing Budget

It is crucial to set an appropriate marketing budget for app marketers. It helps you to allocate funds. By setting a budget ahead of time and allocating funds for your strategies, you can make adjustments and switch the strategy based on what is yielding a positive ROI.

Setting a marketing budget helps you to keep on track for managing your goals. It also helps with long term planning. First you need to assess the total app cost including the development and maintenance. Then allocate that part of the budget for marketing.

As recommended by experts, spend 12-20 percent of your gross revenue on marketing and when your app becomes more established, you can lower this to 6-12 percent.

If your app is still in  the pre-revenue stages, this becomes a little more challenging. Set a fixed amount aside specially for your marketing cost if you  fall under that category. 

Another important aspect of setting an app marketing budget is general financial responsibility.  You will welcome a disaster if you spend it with no clear plan. So it is necessary for you to build these healthy financial habits from day one. 

 

Creating a mobile app marketing budget 

 

Following are the steps required to create your budget.

  • Assess your marketing funnel 

This refers to the entire journey taken by the users before installing your mobile app. It is important to assess the process even if you haven’t officially tracked users going through the marketing funnel before. 

When potential user first realizes that your app exists, the awareness phase happens. When they think about getting an app or similar tool in your category, that is the interest stage. They are at the desired stage when they start leaning towards a particular option or brand. They reach the action stage when they finally decide to install your app.

The journey taken by users from awareness to action is shown by your marketing funnel. You will learn which channels are moving people through the funnel and driving the best results. This will help you to allocate funds. 

  •  Define your goals

App install is not the only goal you should be focusing on for every marketing campaign. For example, some mobile apps want the app to be an extension of an ecommerce site and drive purchases of physical goods, while some want to sign up users for monthly or annual subscriptions. Both the scenarios will need different marketing strategies and hence would have different budget priorities. 

  •  Account for other operating costs

 The entire app development  and maintenance after the launch  come at an expense. Paying the developers, design costs, severs, utilities, subscriptions, and all the other backend costs associated with the app development, all these needs to be taken care of. 

Also, if you rent an office or physical space for your business, if you  pay someone for maintaining your website or creating content, and if you hire an app marketing agency to help you are the other things that would be added to your cost. 

Operating costs for everyone differs a bit. But all  the money you have can not be allocated towards the marketing as there are other costs to think of.

  • Identify your most profitable marketing channels

You will need to experiment with different marketing strategies and channels in the beginning to understand which channels are addressing your previously defined goals and weed out the ones that are not profitable. 

You can start with the email ads, search ads, or paid social media ads. After that you can expand into long -term strategies, like organic search through content creation. You can even test small variations of campaigns within these profitable marketing channels.  

  • Compare your marketing budget with other mobile KPIs

Aside from the results and metrics coming from each campaign, you should be looking at other KPIs which will help you to find events that could contribute to your goal’s performance. Once you can narrow down the metrics that can impact your marketing plans, all of this will make a lot more sense. 

Components of mobile app marketing budget

How much it will cost to market your app will be dependent on where you want to spend the money. Following are some key components you need to take into account. It will help  you to figure out your app marketing cost.

  • Market research

Market research refers to assessment of the marketing funnels and preferred online channels where you can reach potential app users. For example, if you have a health app designed for people over the age of 60 years, you won’t be marketing the app on platforms like Snapchat. Instead, you need to find a place where people of that particular age hang out. Market research involves his kind of process.

  • Beta testing 

Beta testing is very crucial for the long time success of your app and its functionality, but this aspect is often overlooked. When the real app users actually use your app, you would want to see how they feel about it. 

To test the mobile apps, platforms like User Testing are useful. The marketing expense for this depends on how many users you want to test your app. It also depends on which platform you use and how long you want this testing to last. 

 

  • App promotion assets costs

You need to create digital app marketing assets regardless of the type of your app. Visuals used for marketing campaigns will fall into this category. 

Unless you are a designer and content creator yourself, the things like creating the custom visuals for your app landing page or creating promotional videos cost money. The prices for this vary based  on who you are hiring and what you are getting. Even if you have a team of your own dedicated to these assets, you will still need to budget for the time it takes for those people to create digital assets for your app. You need to add those costs into your marketing budget.

  • Viral marketing 

To draw attention to your app, the concept of ‘going viral’ can be a cost-effective way. Usually this isn’t easy or guaranteed, but if it happens, viral marketing costs money. 

Normally, this would not have a fixed amount attached to it, but you need to  think about the cost associated with the strategy that has potential to go viral. 

  • Social media marketing 

One of the key parts of app marketing is to establish your presence on social media. We know that creating a social media account does not cost money but keeping those accounts active surely needs money.

Even if you don’t plan to spend money on social media, there needs to be someone who will write posts, share content, engage the audience and reply to messages.

You might be able to handle this in the beginning, eventually you will need someone to manage your social media accounts.

  • Influencer marketing

In recent years this marketing strategy has become more famous. Influencers on social media are paid to market your app using their platform. It is as simple as a post on Meta or Instagram that features your app.  You can develop ongoing relationships with different influencers and make it your one-time strategy. 

If you cannot find an  influencer fitting to your budget, you can take help from a PR. But in addition to the influencer marketing costs, the PR outreach costs will need to be added to your budget.

  • Website

To have an online presence, you need to have a promotional website for your app. This would be simple if you already have a business and you’re creating an extension. If you already have a website, you would just need to have a dedicated landing page on your site to promote your app. 

Whereas If you are launching an app as a completely  new business, you can use online website builders like Wix or Squarespace to  get started. 

  • ASO- App store optimization 

You need to invest money into ASO for getting organic downloads from your app on the app stores. When someone searches the Google play store or Apple store, this will help you to stand out from other options within your app category.

Just understand that your ASO strategy will look a bit different for your Android and your iPhone app. It is because the algorithms and formula used for ranking apps in each differs slightly.

 

Final  thoughts

It is necessary for you to plan your app marketing expenses before you launch an app marketing campaign. Creating a budget is the most essential way to have success with your app marketing strategy. Otherwise you will be wasting a lot of money on something that won’t get you  anywhere. 

Remember to not waste any money on marketing that is actually needed for development, testing and maintenance of the app.

I sincerely hope that this guide becomes useful to you, and enlightens you on planning your app marketing budget rightfully. 

 

November 24, 2021

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