Return on Ad Spend (ROAS)

The amount spent for each newly-acquired mobile app user over a given time period. Customer Acquisition Cost (CAC) for mobile apps refers to the cost that a business incurs to acquire a new user for their mobile application over a specific period of time. In other words, it is the amount of money spent to attract a user to download and install a mobile app on their device. Whether you are just embarking on your journey or navigating quite a while to create a successful mobile app, the Customer Acquisition Cost (CAC) must be at the forefront of your mind.

LTV meaning, Lifetime Value (LTV), is a performance indicator used to evaluate the total earnings generated by a customer throughout their entire tenure of using a mobile application. Historical data on user retention rates is often used to estimate the expected duration of user engagement. Having knowledge of what is LTV and the average LTV of your customers is crucial for executing successful marketing strategies. LTV in marketing for mobile apps is normally used to optimize revenue streams such as subscriptions, in-app advertising, and in-app purchases by determining the amount of money that can be spent on user acquisition while still being profitable.

Cost Per Action (CPA) is a performance-based pricing model in which an advertiser pays only when a user completes a specific post-install action, such as making a purchase, starting a free trial, or subscribing to a service. Unlike CPI, which measures cost at the install level, CPA ties advertising spend directly to business outcomes further down the funnel. For subscription apps, common CPA events include trial starts, first subscription payments, or registration completions. CPA is particularly useful for evaluating the true efficiency of user acquisition campaigns, since an install alone doesn't generate revenue — what matters is whether the user converts into a paying subscriber. By optimizing toward CPA rather than CPI, growth teams can focus ad spend on channels and creatives that deliver users with higher intent and better downstream conversion behavior, even if those channels have a higher cost per install on the surface.

CPI stands for Cost Per Install, meaning the cost that an advertiser pays each time a user installs their mobile app after clicking on an ad. CPI is a performance-based pricing model, which means that the advertiser only pays for results that directly contribute to their business goals, such as app installations. This pricing model is particularly popular among mobile app developers who want to promote their apps and acquire new users.

Predictive LTV (pLTV) is the use of statistical models and machine learning to forecast the future lifetime value of a user or cohort based on their early behavior signals. Rather than waiting months or years to observe a user's actual LTV, predictive models estimate what a user will spend over their entire lifecycle using data available within the first hours, days, or weeks after acquisition. Common input signals include acquisition source, geographic location, device type, onboarding completion, early engagement patterns, initial purchase behavior, and session frequency. For subscription apps, predictive LTV models typically forecast metrics like probability of trial-to-paid conversion, expected subscription duration, likelihood of plan upgrade, and projected total revenue. Predictive LTV is critical for real-time user acquisition optimization — by estimating the long-term value of users from a particular campaign early, growth teams can dynamically adjust bids, budgets, and targeting without waiting for actual revenue to materialize. This is especially important in the post-ATT landscape where campaign-level feedback loops are slower and less granular. Advanced implementations use predictive LTV signals to personalize paywall offers, onboarding flows, and re-engagement messaging in real time.