The cost of advertising in search results on Apple’s App Store has nearly doubled, according to data from mobile app growth company SplitMetrics.
The cost per tap (CPT) for when a user taps on the ad reached $2.27 in the final three months of 2021. This is an increase of 92% from the previous year and is the first time the cost has exceeded $2.00.
This is a far larger increase in costs than seen elsewhere in digital advertising.
At the same time, the cost per acquisition (CPA) for when a user installs the app reached $3.64. This is 80% more expensive than the year before and the first time it has been above $3.00.
This follows Apple’s launch of iOS 14.5 in April 2021, which enabled users to disable tracking across apps. This damaged the ability of digital ad businesses to offer targeted advertising and track conversions, with Facebook claiming it will lose $10bn in revenue in 2022.
It also strengthened Apple’s own advertising business, with the company gaining market share in the US, China, the UK and Australia. Media analysts Omdia estimate Apple Search Ads revenue rose by 264% in 2021 to $3.5bn.
This strong growth is likely to continue, with WARC Data forecasting digital ad spend to rise by 16% in Q2 2022.
