Google Ads App Install Pricing: The 2024 Guide

One of the first questions any app founder asks before dipping their toes into paid advertising is, "How much is this going to cost me?". They're looking for a number, a neat little figure like £2.50 per install, so they can plug it into a spreadsheet and project their growth. But I'm going to be brutally honest: searching for an "average Cost Per Install" for a Google Ads campaign is a complete waste of your time. It's like asking for the average price of a house in the UK; it tells you nothing useful about the 2-bed flat you're trying to buy in Manchester.

The price you pay for a new user isn't some fixed market rate. It's a dynamic number dictated by your industry, your target audience, the quality of your ads, and most importantly, the economics of your own business. A "good" CPI for a casual mobile game with low revenue per user would be catastrophic for a subscription-based FinTech app. So, instead of chasing a meaningless average, we'll explore how to figure out the only number that matters: the maximum price *you* can afford to pay to acquire a new user and still build a profitable business. We're going to tear down the flawed logic of focusing on CPI and rebuild your strategy around the metrics that actually drive growth.

So, What Will My Google Ads App Install Campaign Cost? (And Why That's the Wrong Question)

Let's get the basic answer out of the way first, just to satisfy the spreadsheet. For an app install campaign targeting the UK, you could be looking at anything from £1.50 to over £15 per install. If you're targeting a country like India or the Philippines, that might drop to £0.30. If you're in a hyper-competitive space like gambling or finance, that £15 could look cheap.

See the problem? The range is so vast it's practically useless for planning. A campaign for a simple utility app might see a low CPI, while something more niche, like acquiring users for a new payment app in the UK, will face much higher costs due to competition and the higher value of each user. I remember one campaign we worked on for a sports and events app where we managed to drive over 45,000 signups at under £2 per install, which was fantastic for their model. But a B2B SaaS client would be thrilled to get installs for £20 if the user eventually converts to a £5,000 annual contract.

The real question isn't "How low can my CPI go?" but "How high a CPI can I afford to acquire a valuable user?" The answer to that lies in its counterpart: Lifetime Value (LTV). The fundamental rule of paid acquisition is simple: you need to make more money from a user over their lifetime than it costs you to acquire them. A healthy, sustainable business model typically aims for a 3:1 LTV to Customer Acquisition Cost (CAC) ratio. This means for every £1 you spend to get a user, you should expect to get £3 back in profit over their lifetime. This ratio gives you enough margin to cover your other business costs (salaries, servers, office space) and still have profit left over to reinvest in growth.

Once you understand this, your entire perspective shifts. You stop chasing cheap installs from low-value countries and start focusing on acquiring high-quality users, even if they cost more upfront, because you know the long-term maths works out. This is the foundation of intelligent, scalable growth, and it all starts with calculating your LTV.

Forget CPI for a Minute. Let's Calculate Your LTV.

Before you spend another pound on ads, you need to get this calculation right. It's the engine of your entire growth strategy. If you don't know your LTV, you're flying blind, making decisions based on gut feel rather than hard data. The formula itself is fairly straightforward.

LTV = (Average Revenue Per User (ARPU) * Gross Margin %) / Monthly Churn Rate

Let's break that down:

• Average Revenue Per User (ARPU): How much revenue, on average, does a single user generate for you each month? This could be from subscriptions, in-app purchases, or ad revenue. Be honest here.
• Gross Margin %: What's your profit margin on that revenue? You need to subtract any direct costs associated with delivering your service. For a software app, this is often very high (80-90%+), as the main cost is in development and support, not delivering the product to one extra user. For an e-commerce app, this would be your revenue minus the cost of goods sold.
• Monthly Churn Rate: What percentage of your active users do you lose each month? This is a critical one. A high churn rate will absolutely kill your LTV. If 10% of your users cancel their subscription every month, your average user lifetime is only 10 months (1 / 0.10).

Now, let's make this practical. Instead of just looking at the formula, use the calculator below to figure out your own numbers. This isn't just a gimmick; it's a vital tool for understanding your business's financial health and advertising potential.

Once you have that 'Affordable CAC' number, everything changes. Suddenly, a £10 CPI doesn't look so scary if your affordable CAC is £106. In fact, it looks like a bargain. You now have a clear target. Your goal is no longer to get the 'cheapest' installs; it's to get installs consistently below your affordable CAC. This empowers you to make smarter decisions, invest confidently, and ignore the vanity metric of a low CPI that might be bringing in users who churn after a week.

What Actually Determines Your Cost Per Install?

Now that we've established the right strategic framework, we can look at the mechanics of the Google Ads auction. Your CPI isn't a price you pick; it's the output of a formula influenced by several factors. Understanding this formula is crucial to knowing which levers you can pull to influence the final cost.

At its core, the process looks like this: You pay Google for impressions (CPM - Cost Per Mille, or cost per 1000 views). A certain percentage of people who see your ad will click on it (CTR - Click-Through Rate). This gives you your Cost Per Click (CPC = (CPM/1000)/CTR). Then, a percentage of people who click will actually install the app (CVR - Conversion Rate). This gives you your final Cost Per Install (CPI = CPC / CVR). It's a funnel, and optimising each step is how you lower the final cost.

Here are the key factors that influence the numbers in that funnel:

• Targeting (Geography & Audience): This is the big one. An impression in the US costs far more than one in Vietnam because US consumers have higher spending power, so advertisers are willing to pay more to reach them. Similarly, targeting high-value demographics (e.g., C-level executives for a B2B app) is more expensive than targeting a broad consumer audience.
• Competition: If you're in a crowded market like mobile gaming or financial services, you're bidding against hundreds of other advertisers for the same eyeballs. This drives up the CPM, making everything else downstream more expensive.
• Platform (iOS vs. Android): Historically, iOS users have been more expensive to acquire. The data is a bit more opaque post-ATT (Apple's App Tracking Transparency), but the general principle holds that iOS users are often perceived as having higher LTV, making them more competitive to target.
• Ad Creative Quality: This is your most powerful lever. A compelling, engaging video ad that stops the scroll will have a much higher CTR than a boring static image. A higher CTR tells Google your ad is relevant, which can lead to a lower CPC. We've seen some SaaS clients get incredible results with simple, authentic UGC (User-Generated Content) style videos.
• App Store Listing Optimisation (ASO): This affects your CVR. If a user clicks your ad but lands on a poorly designed app store page with bad screenshots, confusing text, and negative reviews, they're not going to install. A polished, professional, and persuasive store listing is a non-negotiable part of the funnel. A low Google Ads conversion rate can often be traced back to weaknesses on the landing page, and for app campaigns, your store page *is* your landing page.

What Should I Expect to Pay for App Installs in the UK?

Right, let's get specific to the UK market. The UK is a Tier 1 advertising country, meaning it's one of the most developed and competitive markets. Costs here are high, but so is the potential LTV. You won't find the rock-bottom CPIs of developing nations, but the quality of user is generally much higher.

Based on our experience running numerous UK campaigns, the benchmarks vary significantly by app category. The chart below gives a realistic, if broad, idea of what you might expect to pay. These aren't promises, but they are grounded in real-world data from our campaigns.

Why the huge difference? It comes back to LTV. A user of a FinTech app who might generate hundreds or thousands of pounds in revenue is worth far more than a casual gamer who might watch a few ads. The advertisers in the FinTech space know this, so they are willing and able to bid much higher, driving up the auction price for everyone in that category. The same logic applies to B2B apps; the path to conversion might be longer, but the eventual contract value justifies a higher initial acquisition cost. We've seen this in our own work on B2B lead generation campaigns for UK clients, where the focus is always on the quality and potential value of a lead, not just its initial cost.

Okay, I Get It. Now, How Do I Actually *Lower* My CPI?

Understanding the theory is one thing; putting it into practice is another. Once you've defined your affordable CAC, the game becomes about systematically optimising your campaigns to acquire users below that threshold. Here’s a breakdown of the levers you should be pulling, in order of impact.

1. Creative is Your Biggest Weapon (Stop Ignoring It)

This is, without a doubt, the single biggest factor you can control to influence your CPI. Too many founders get obsessed with complex audience targeting and bidding strategies while running the same two tired image ads for months. Google's algorithm is incredibly sophisticated; its ability to find the right people is often better than our manual attempts. Your job is to feed that algorithm compelling, high-quality creative that resonates with your audience.

-> Relentless Testing: You should have a constant pipeline of new ad creatives. Don't just test different button colours. Test entirely different concepts, value propositions, and formats. We aim to test at least 5-10 unique ad concepts for new clients in the first month alone.

-> Video is Non-Negotiable: For app installs, video almost always outperforms static images. It allows you to demonstrate your app's functionality and value proposition much more effectively. Test different lengths (15s, 30s), aspect ratios (vertical for stories/shorts, square for feed), and styles (animated explainer, screen recording, user-generated testimonial).

-> Focus on the First 3 Seconds: You have a fraction of a second to capture attention. Your opening scene, hook, or headline must be powerful enough to stop someone from scrolling. Lead with the problem you solve or a visually striking image.

2. Smart Targeting: Broad is Often Better (Eventually)

This might seem counter-intuitive, but for Google App Campaigns, tighter targeting isn't always better. The platform's machine learning is designed to find users most likely to install and take action *within* the broad audiences you provide. Starting with hyper-niche interests can sometimes starve the algorithm of the data it needs to learn and optimise effectively.

-> Start with Interests/Affinities: In the beginning, give the algorithm some direction. Target audiences based on related apps, websites, or general interests that align with your ideal user. For a fitness app, this might be interests in 'running', 'gyms', or users of competitor apps.

-> Graduate to Broad: Once your campaign has generated a few hundred installs and has a stable CPI, don't be afraid to test a campaign with very broad targeting (e.g., just specifying country, age, and gender). You will often be surprised how effectively the algorithm can find your customers without your help, sometimes at a lower cost. This is because it's not limited by your assumptions of who your customer is.

-> Leverage Your Data: The most powerful audiences are the ones you build yourself. Once you have enough data, create audiences based on in-app actions (e.g., 'users who completed a purchase') and use them for tROAS (target Return on Ad Spend) campaigns. This tells Google to find more people *like* your most valuable users, which is far more powerful than any interest targeting.

3. Your App Store Listing is Your Landing Page

You can have the best ad creative in the world, but if it leads to a confusing or untrustworthy app store page, your CVR will plummet, and your CPI will skyrocket. Treat your store listing with the same rigour as a high-stakes e-commerce product page.

-> A/B Test Everything: Use Google Play's built-in Store Listing Experiments (or a third-party tool for the App Store) to test your icon, feature graphic, screenshots, and short description. Even a small lift in conversion rate of 5% can have a significant impact on your overall CPI.

-> Social Proof is King: Encourage happy users to leave reviews. Positive ratings and recent, detailed reviews are one of the strongest conversion signals for new users. A 4.8-star rating is a powerful marketing asset.

-> Clear Value Proposition: Your title and short description should instantly communicate what your app does and for whom. Don't be clever; be clear. Use your screenshots to visually walk the user through the app's core benefits, not just its features.

Your 90-Day App Install Campaign Action Plan

Bringing it all together, here is a structured plan to launch and optimise your Google Ads app campaigns. This approach prioritises data collection and iterative improvement over searching for a magic bullet.

Is It Time to Call in an Expert?

As you can see, successfully running a Google Ads app campaign is far more involved than simply setting a budget and hoping for the best. It's a complex interplay of financial modelling, creative strategy, data analysis, and continuous, disciplined testing. The path is full of potential pitfalls that can lead to a lot of wasted ad spend and frustration.

While this framework is a powerful starting point, executing it flawlessly requires experience. Knowing which creative to test, how to interpret the data, and when to scale or pull back is a skill honed over hundreds of campaigns. An expert can help you bypass the costly learning phase, implement best practices from day one, and accelerate your path to profitable growth. Deciding between running ads in-house and hiring an agency is a big decision, and understanding the true costs and benefits of each approach is an important first step.

If this sounds a bit overwhelming, or you're simply ready to get serious about scaling your app with a team that does this day-in, day-out, it might be time for a chat. We offer a free, no-obligation strategy session where we can dive into your app, your goals, and your current advertising efforts to provide clear, actionable advice. Let us help you turn your ad spend into a predictable engine for growth.