Hi there,
Thanks for reaching out! I'm happy to give you some initial thoughts and guidance. Your question about budgeting for Apple Search Ads without clear cost data is a really common one, and frankly, it's the right one to be asking before you spend a single pound.
The short answer is there's no simple price list. Costs can vary wildly. But the good news is you don't need one. I can walk you through a much better way to think about it, helping you build a budget based on your app's actual value rather than guesswork. We'll look at how to calculate what you can afford to spend and how to pick your markets strategically to avoid burning cash.
TLDR;
- There is no fixed cost for Apple Search Ads; it's an auction where prices change based on competition, your target country, and ad quality.
- Stop trying to find the cheapest installs. The most important piece of advice is to first calculate your app's Customer Lifetime Value (LTV) to determine what you can afford to pay per user.
- This letter includes an interactive LTV Calculator to help you work out your maximum affordable Cost Per Acquisition (CPA).
- Don't launch worldwide. Start with a single, high-value country (like the US or UK), prove the model works, and then expand. Targeting developing countries might seem cheaper but often results in low-quality users and wasted spend.
- Apple Search Ads are great for capturing existing demand, but you should also consider platforms like Meta (Facebook/Instagram) to create demand once you're ready to scale.
We'll need to look at why ad costs are a moving target...
First off, lets get one thing straight. The reason you can't find a reliable price list for Apple Search Ads (or any major ad platform, for that matter) is because one doesn't exist. It's not a shop where you buy installs off a shelf at a fixed price. It's a real-time auction.
Imagine you're bidding for a specific user who just typed "photo editor app" into the App Store. You're not the only one who wants that user. Adobe is there, a dozen other startups are there, and you're all bidding against each other. The final price you pay—the Cost Per Tap (CPT)—is determined by how much the next-highest bidder was willing to pay, plus a small increment. This price is constantly changing based on:
- Competition: How many other apps want the same keywords and users as you?
- Geography: A user in the United States is far more valuable (and therefore more expensive to acquire) than a user in a lower-income country.
- Time of Day/Year: Costs can spike during holidays or weekends when more people are on their phones.
- Your Ad's Quality: Apple gives a 'relevance score' to your ad. A highly relevant ad (good icon, clear screenshots, strong description) can actually win the auction even with a lower bid, because Apple wants to show users results they'll actually tap on.
So, trying to find a fixed cost before you start is a fool's errand. You're asking the wrong question. It leads to a mindset of chasing the lowest possible install price, which is a surefire way to acquire lots of low-quality users who never spend any money and churn immediatly. The question you should be asking isn't "How much do ads cost?", but rather "How much can I afford to pay for a valuable user?".
I'd say you need to calculate your Customer Lifetime Value (LTV) first...
This is the single most important bit of maths you can do for your business. Before you even think about setting a budget, you need to know what a customer is actually worth to you over their entire relationship with your app. This number, your LTV, dictates your entire marketing strategy. Without it, you're just flying blind and probably setting yourself up for faliure.
The calculation itself isn't too complicated. You just need three key metrics:
- Average Revenue Per Account (ARPA): How much money does a typical user generate for you each month? This could be from a subscription, in-app purchases, or ad revenue.
- Gross Margin %: What percentage of that revenue is actual profit after accounting for costs like App Store fees, server costs, etc.?
- Monthly Churn Rate: What percentage of your users do you lose each month?
The formula is: LTV = (ARPA * Gross Margin %) / Monthly Churn Rate
This tells you the total profit you can expect from a single customer. And once you know that, you know how much you can spend to get them. A healthy rule of thumb is to aim for a 3:1 LTV to Customer Acquisition Cost (CAC) ratio. This means you can afford to spend up to one-third of your LTV to acquire a new customer and still have a very profitable business. This simple calculation changes everything. It moves you from a cost-focused mindset to a value-focused one.
Interactive LTV & Target CAC Calculator
You probably should expect a wide range of costs...
Okay, so now you know what you can afford to pay. But what should you realistically expect to pay? Tbh, B2C app installs and signups often fall in the £1-£5 range in developed countries. We recently worked on an app growth campaign where we hit over 45,000 signups at an average cost of under £2 per user, which is a great result. That said, I've seen costs for niche B2B software go as high as $22 per lead on platforms like LinkedIn, and even simple trials for a B2B SaaS on Meta can be around $7.
The cost really comes down to two numbers: your Cost Per Tap (CPT) and your Tap-to-Install Conversion Rate. In developed countries like the UK or US, you might see CPTs between £0.50 and £1.50. In developing countries, it could be as low as £0.10. Then, a decent conversion rate from a tap to an actual install is anywhere from 30% to 60% on Apple Search Ads (it's often much lower on other platforms).
So, the maths for a rough estimate would be: Cost Per Install (CPI) = CPT / Conversion Rate.
A quick example for a developed country: with a CPT of £1.00 and a conversion rate of 50%, your CPI would be £2.00. This falls right in that typical range. But if your conversion rate is only 30%, that same £1.00 CPT results in a £3.33 CPI. This shows how much a well-optimised App Store page can affect your costs. Minor improvments to your icon, screenshots, or the first line of your description can have a massive impact on your bottom line.
Interactive Cost Per Install (CPI) Estimator
You'll need a phased rollout strategy...
Since you haven't decided on a location yet, this is the perfect time to give you some brutally honest advise: do not launch worldwide. It's the most common and costly mistake I see. You'll spread your budget too thin, get a flood of low-quality installs from cheap countries, and you wont learn anything useful. Your data will be a mess of different languages, cultures, and user behaviours.
The professional approach is to start small and focused. Pick one, maybe two, high-value markets to begin with. These are usually the English-speaking, developed countries:
- United States
- United Kingdom
- Canada
- Australia
- Ireland
- New Zealand
Yes, users here are more expensive. But they also have much higher spending power, which means a higher potential LTV. Your goal in the beginning is not to get millions of downloads; it's to prove that you have a viable business model. You need to prove that you can acquire users in a valuable market for less than they are worth to you. Once you've cracked the code in one country, you can use those learnings and profits to methodicaly expand to others.
Here's a simple framework for how to think about choosing your first market.
You probably should consider other platforms too...
While Apple Search Ads is the obvious starting point, it's not the only game in town. It's fantastic for capturing existing demand—people who are already in the App Store looking for an app like yours. This is high-intent, high-quality traffic, and it's why it's the best place to start your tests.
However, its scale is limited. You can only reach people who are actively searching. Once you've proven your model and want to grow faster, you need to start creating demand. This is where platforms like Meta (Facebook/Instagram) and TikTok come in. Here, you're not targeting keywords; you're targeting people based on their interests, behaviours, and demographics.
You can reach a vastly larger audience and put your app in front of people who didn't even know they needed it yet. If you recall the app growth campaign I mentioned earlier, we used a mix of Apple Ads, Google Ads, Meta, and TikTok to scale it. This multi-platform approach was highly effective and ultimately drove those 45,000+ signups. The costs on these platforms can be very competitive, but the user intent is lower, so you need compelling video creative and a really smooth onboarding experience to make it work.
I've detailed my main recommendations for you below:
To wrap this up, here is a clear, actionable plan. This is the exact process we'd follow to take an app from zero to a scalable, profitable user acquisition machine.
| Step | Action | Why It's Important |
|---|---|---|
| 1. Define Your User's "Nightmare" | Don't just think about demographics. What specific, urgent problem does your app solve? Your marketing messages must speak directly to this pain point. | This ensures your ad copy and creative resonates deeply, leading to higher conversion rates and a better ad relevance score. |
| 2. Calculate Your LTV | Use the interactive calculator above to determine the lifetime value of an average user. If you don't have data, make conservative estimates. | This is your north star. It tells you the absolute maximum you can afford to spend to acquire a customer and remain profitable. |
| 3. Set Your Target CPA/CPI | Based on a 3:1 LTV:CAC ratio, set a firm goal for your maximum Cost Per Install or Cost Per Acquisition. | This provides a clear benchmark for success. You'll know instantly if a campaign or keyword is working or if it needs to be cut. |
| 4. Select ONE Launch Market | Choose a single, high-value country to start with (e.g., US or UK). Resist the temptation to go broad. | This gives you clean, actionable data and allows you to prove your business model on a small, controlled scale before risking a larger budget. |
| 5. Launch Test Campaign | Start with a small budget (£500 - £2,000) on Apple Search Ads. Target a tight list of high-intent, brand, and competitor keywords. | This is the fastest, most capital-efficient way to get feedback from the market and see if you can acquire users profitably. |
| 6. Analyse, Iterate, and Scale | Once you have a profitable campaign on ASA, you can begin to scale the budget and expand to other platforms like Meta to drive volume. | Growth should be systematic. You earn the right to scale by first proving profitability at a smaller level. |
As you can probably tell, this is more complex than just setting up an ad and hoping for the best. It requires a clear strategy, constant testing, and a deep understanding of how each platform works. Getting it right can be the difference between burning through your savings and building a sustainable, fast-growing business.
This is where professional help can make a huge diference, saving you time and money by avoiding common pitfalls and implementing proven strategies from day one. If you'd like to discuss your app in more detail, we're happy to jump on a quick, free consultation call to review your plans and give you some more specific advice.
Hope this helps!
Regards,
Team @ Lukas Holschuh
