Christoph Sachsenhausen, managing director at Sunday, shared an interesting article on the problems of CPI.

How do we look at metrics and games?

Usually the decision to continue with a game lies behind a KPI-gate: The CPI! It revolves around the simple fact: The cheaper the game is in marketing, the easier it is to scale for revenue.

How do we measure the CPI?

You create a video, give it to a social network, set a budget and say: Give me the most installs for my budget! The social network will then display the CPI to you! The CPI is the money you spent divided by the installs you got. This process is very established and has been used for many years!

But what is the problem now?

The CPM (price for 1000 ad impressions) is set by the social network and heavily influences the CPI you get. The CPM heavily fluctuates through changes in economy, seasonal changes and the factor of demand & supply. As a developer, you have no influence on these factors.

So why do publishers keep working with CPI?

It’s an easy to use KPI and it also comes with very low risks for the publisher. Everyone knows how to work with it and if a CPI is low it is guaranteed that the game will be easy to scale.

Here comes a new challenger: IPM!

The IPM tells you the amount of installs out of 1000 ad impressions. It’s literally the conversion rate of your creative. Because of this, it is completely independent of every CPM change on the market.

Looking closer at SDK networks instead of social networks.

The majority of traffic does come from SDK networks. Here you create your own CPI, the “bid CPI”. With the “bid CPI”, you tell the network how much you want to pay for every install. SDK networks then measure the performance of your video and determine the IPM for you. This IPM is usually stable and comparable throughout all ad networks!

Here is an example of our game “Fall Break”.

It had a mediocre facebook CPI of 0.37ct but a high IPM of 150 on the sdk networks. This means that the creative had a conversion rate of 15%. The IPM told us that this game has good marketability! So we continued with it and two weeks later it was #1 in 10 countries including the USA.

Does this mean that CPI is dead?

Short answer: No! CPI is still important and contains a lot of information in regards to scalability. In general, it’s best to look at all the data to get a complete picture. But CPI is not the gold standard for us anymore and the sole reason to even kill a project.

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