June 1, 2023

Paid user acquisition vs organic user acquisition: How to find the right balance

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What is paid user acquisition and how does it work?

        Pros of paid user acquisition

        Cons of paid user acquisition

What is organic user acquisition and how does it work?

        Pros of organic user acquisition

        Cons of organic user acquisition

Balancing paid user acquisition vs organic user acquisition

Which app categories are best suited to paid vs organic?

        Features that maximize the returns of paid UA

        Features that maximize the returns of organic UA

Loyalty and user acquisition

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To say that the mobile app market is competitive is a bit of an understatement. According to Statista, there were 3.55 million apps¹ on Google Play in Q3 of 2022. Meanwhile, per data on Zippia, the average smartphone owner uses about 30 apps per month². Mobile marketers are constantly having to vie for space on the home screen, and the surest way to do that is by continuously adding new users through organic and paid user acquisition strategies. 

Both strategies have their merits, and each one has something to offer to both seasoned marketers and those new to the game. It all starts with a comprehensive understanding of the differences between the two.

What is paid user acquisition and how does it work? 

Paid user acquisition is a growth strategy that relies primarily on digital advertising as a means of expanding an application’s user base. In the case of mobile applications, app publishers pay to run ads promoting their app across different digital environments. Where possible, the ads are targeted towards the desired user base and distributed through a variety of paid marketing channels like social media platforms and in-app advertising networks. Potential users see the ad and (if they find it compelling enough), decide to install. Depending on the “quality” of the install, i.e. how well targeted the ad campaign is and the conditions under which the install was driven, users will hopefully stick around long enough to make in-app purchases, become a paying-subscriber or otherwise convert on other monetization methods the app employs.  

Paid user acquisition campaigns can take place across a variety of different platforms, all of which offer varying degrees of targeting, testing, and measurement capabilities. Some of the most common channel categories include:

  • In-app ad networks: Your ads run in other mobile apps, often of a similar category, either presented via interstitials, rewarded placements, offerwalls, banners, etc….
  • Social media platforms: Ads on channels such as Facebook, Instagram, Reddit, TikTok.
  • App store search ads: Ads that appear as users search and scroll through an app store.
  • Paid influencer/sponsored content channels: Branded videos or social media posts created by an influential persona.
  • Google Ads: Ads shown to targeted web users as they are scrolling websites or SERPs (search engine results pages).
  • Native ad networks: Native UA channels offer a variety of solutions that more closely resemble organic channels, delivering similar performance when it comes to retention & LTV.

Paid ad campaigns can also be executed based on a variety of pricing models, each with their own unique benefits and drawbacks. Depending on the marketer’s desired outcome, they may elect to choose a specific pricing model that places more or less pressure on the platform to deliver results. Some of the most common paid user acquisition pricing models include:

  • Cost Per Install (CPI): Perhaps the most popular pricing model for mobile app marketers, cost-per-install (CPI) is a performance pricing model in which the marketer pays only when a user installs an app.
  • Cost Per Click (CPC): In this model, advertisers pay for each click their ad receives. The cost is determined by the agreed-upon rate for each click, regardless of whether the user takes any further action after clicking the ad or not.
  • Cost Per Mille/Thousand (CPM): CPM pricing is based on the number of impressions, i.e., the number of times an ad is displayed to users. Advertisers pay a fixed rate per thousand impressions, regardless of whether users interact with the ad or not.
  • Cost Per Action (CPA): CPA is another performance-based pricing model where advertisers only pay when a specific action is completed by the user, such as making a purchase, filling out a form, or signing up for a newsletter. In the context of mobile games, the “action” is often a progression milestone, like reaching a certain level or completing an achievement. Advertisers agree on a predetermined rate for each action.
  • Cost Per Lead (CPL): Similar to CPA, CPL is a pricing model where advertisers pay for each qualified lead generated through their ad campaign. A lead typically involves a user expressing interest in a product or service by providing their contact information.
  • Cost Per View (CPV): CPV pricing is commonly used in video advertising campaigns. Advertisers pay for each instance in which their video ad is viewed or interacted with by a user. The view may be counted after a certain duration or engagement threshold is met.
  • Flat Rate/Fixed Pricing: In this model, advertisers pay a predetermined amount for a specific duration or placement of their ad. It could be a fixed monthly fee or a one-time payment for a set period, regardless of the number of impressions, clicks, or actions.

Pros of paid user acquisition

Paid UA is an effective way of driving a predictable number of installs either on an ongoing basis or over a shorter fixed period of time. Unlike most organic UA channels, which can rise and fall based on community activity or seasonality, paid UA lets marketers keep their hand on the throttle and dial the flow of users up or down depending on their strategy. Ads start running as soon as campaigns are launched, meaning that marketers are able to see immediate results. Because they’re initiated by the marketer, calculating channel-specific ROAS (return on ad spend) is also relatively easy to calculate, provided campaigns are executed with the support of an MMP (mobile measurement partner) like Adjust, Appsflyer, Tenjin or Singular.

Paid UA strategies also allow for some audience targeting – though there are now fewer options as a result of user privacy changes³ made by Apple and Google. On top of that, most major platforms have shifted towards algorithmic campaign targeting that takes advantage of AI as a means of campaign targeting. This allows for a broader reach, but offers few (if any) manual targeting capabilities for marketers to dial in. Most modern digital advertising platforms still offer campaigns on performance-based pricing models, which is great for measuring and iterating your creative strategy, allowing you to get to know your audience even better for future campaigns. 

Lastly, paid user acquisition tactics can also result in organic lift. Rapidly increasing your number of installs via extremely short and concerted ad campaigns – known as burst campaigns⁴ – can help boost your rankings in app stores, where more people will see your listing and may choose to give your app a try. 

👀 Related reading:  10 user acquisition channels marketers need to know in 2023

Cons of paid user acquisition

The strengths of paid user acquisition strategies also come with some weaknesses. Marketers can expect to be acquiring users who have essentially been “cold-called”, meaning that they have little or no pre-existing relationship with the title. Without a solid user loyalty strategy in place, there’s immense pressure placed on the user onboarding funnel to demonstrate value to players early on. Failure to do so can lead to low return on investment. 

Did You Know? - Mistplay & User Loyalty 

While there’s no shortcut to fostering user loyalty, there are helpful solutions. The Mistplay loyalty app helps players discover new titles through an AI-driven recommendation engine, optimized towards spending behavior. Mistplay then rewards them with points for playing/spending which can be redeemed for real-life rewards like Amazon gift cards. The result is a more engaged, better retained, highly-loyal user base. 

Reach out to our experts to discover the many advantages of advertising with Mistplay.

Furthermore, Mobile ad fraud⁵ is an ever-present concern in paid UA, which sees mobile marketers paying for fake installs that will never convert or generate word-of-mouth buzz. All that is to say, running ads is often only the first part in long-term user acquisition plans. To avoid losing users post-campaign, you’ll need to invest in loyalty strategies that motivate them to continue engaging with your app. In the age of user privacy where targeting capabilities are limited, app publishers also need to think carefully about their ad creative, which has recently become one of the most heavily weighted variables in a campaign’s performance. If your ad doesn’t match the in-app experience, particularly for mobile games, users may feel like their expectations have not been met, which can lead to higher churn.

And of course, as per the paid user acquisition definition, you must pay to play, which is getting more expensive. The average user acquisition cost on Instagram rose almost 20% from 2021 to 2022, according to Business of Apps⁶. Furthermore, a report covering Q4 2022 CPIs⁷ from Tenjin and InMobi found that the cost of acquiring players for hypercasual games, a genre known for its low-cost installs, had more than doubled to hit an all-time high on both iOS and Android. If you’re new to the market or simply don’t have the resources to continuously run ads, using only paid UA strategies may not be a sustainable option. 

What is organic user acquisition and how does it work?

Organic user acquisition is a growth strategy that seeks to draw in users without the use of traditional advertisements. Unlike with paid UA, where you can easily attribute installs to an ad campaign, organic UA campaigns can be somewhat harder to measure individually. But there are a number of metrics you can track to see if your work is paying off, such as increasing page traffic and reviews, app store conversion rate by A/B testing how people respond to different messaging, subscription numbers for brand newsletters, and likes/follows on social media to indicate boosted brand engagement. Gathering all this data should allow you to connect the dots, perhaps not as precisely as you would for a paid campaign, but definitely enough to provide valuable insights and know whether or not you’re heading in the right direction. 

Some popular organic UA strategies include:

  • App store optimization (ASO): Optimizing your app description with the right keywords, images, and icons to rank higher in-app store searches.
  • Referral programs: Encouraging existing users to refer friends in return for in-app perks or currency.
  • Content marketing: Creating informative and fun content (videos, helpful articles, or GIFs) for potential users and sharing via social media for them to find.
  • Encouraging users to leave reviews and ratings: Asking existing users to leave reviews, which can in turn boost visibility in-app stores.
  • Community building: Participating in online forums, such as Discord, and hosting free events to attract new users.
  • Word of mouth: Users acquired through recommendations are often among the best retained, and a game or app that fosters peer-to-peer interaction can expect to benefit from it.
  • A focus on the best possible user experience: Doing everything possible to catch new users’ attention the second they download your app, with great design.

Pros of organic user acquisition

Organic UA does not involve traditional ads, which means that, when done thoughtfully, it can be a more cost-effective way to drive people to your app. You’ll still need to invest in solutions that help you track organic growth, but you won’t incur costs by running ads. 

It is also a less invasive experience for consumers, who get to discover you on their own time, at the right moment for them, without having to watch a disruptive or annoying pop-up ad that can cause negative sentiment. As privacy concerns around mobile apps grow⁸, more users may come to prefer finding new games or apps on their own. 

Acquiring users organically also tends to be more effective in the long term, increasing loyalty and a user’s lifetime value (LTV). A 2020 Appsflyer study found that eight weeks after installing an app, organic users had been retained at a rate of 4.5%⁹, while those acquired through paid channels had a 3.5% retention rate. Why? One reason is, people who find your app on their own are actively searching for a product like yours and are therefore more likely to stick with it once they do.  

Cons of organic user acquisition

Organic UA typically isn’t an overnight solution. While some apps end up going viral, organic user acquisition often takes time and patience before you begin to see your team’s efforts pay off. Not all companies have the luxury of waiting for users to materialize, especially new apps that only have so much time to prove their success on the market. 

As we mentioned earlier, organic UA can also be more finicky to measure and attribute to a specific marketing effort or strategy. This lack of clear data makes it harder to establish correlations between data points and make the right adjustments. 

Balancing paid user acquisition vs organic user acquisition

When comparing the two, it may be helpful to think of traditional paid user acquisition as a faucet that can be turned up or down depending on external conditions. Success in paid UA is about balancing the market rate of user acquisition against your game or app’s performance, combining to form a positive return on investment. 

Organic user acquisition is more of a long-term investment with returns that, while not immediately evident, have the potential to compound over time. It starts out gradually but remains ever present – as you steadily work toward building momentum, it draws in more engaged, genuinely interested people to your app. Like compound interest, it has the potential to yield outsized returns if invested early in a game or app’s lifecycle. 

That said, paid UA is not better than organic, and vice versa. They simply accomplish different things: paid ads can help you grow your user base when you need it most, while organic growth helps you draw in users over a longer period of time. It’s when they’re used together in the right combination that mobile marketing magic happens.

How best to use the two strategies depends on the app you’re trying to promote. New apps can benefit from the rapid installs generated by paid user acquisition, but for long-term growth, you may want to start investing in some organic or brand-centric UA strategies simultaneously. Another consideration is your marketing budget. If you are trying to reduce marketing spend, it may be wise to reduce paid UA and focus more on organic growth.

Criteria Paid user acquisition Organic user acquisition
Cost Requires a dedicated marketing budget capable of keeping pace with rising CPIs Can be more cost-effective over an app’s lifetime, since publishers don’t pay for ad placement
Targeting Marketers have some degree of control over targeting, though less precise due to new privacy measures & algorithm dependency Content is created for a specific audience and optimized to be discovered, but precise user targeting is impossible
Speed & predictability Capable of driving a consistent volume of installs over a predictable period of time Slow and steady growth at less predictable rates
Engagement Attracts users who are typically seeing the app for the first time, and may churn at higher rates if the ad doesn’t match the experience Users acquired are “warm” and have greater potential for long-term engagement and loyalty
Measurement Performance-based, allowing for better ROI measurement and iteration of creative strategy Metrics can be harder to attribute to a specific strategy, which can make iteration a less precise process
Effect on app store rankings Rapid increase in the number of users can help boost app store rankings App store rankings increase gradually as ASO strategies begin to pay off
User experience Traditionally more invasive since users are presented with ads while they are engaged with another app or web page Less invasive, since users often discover the app on their own through search or by word of mouth
Overall effectiveness Effective for predictable, measurable growth of a user base at a well-defined cost Effective for long-term growth with the potential for evergreen UA at a less- knowable cost

Which app categories are best suited to paid vs organic?

While every mobile marketing strategy should employ some combination of paid and organic user acquisition, there are some characteristics that make particular games or apps better-suited, and more likely to generate returns from one or the other.

Features that maximize the returns of paid UA

  • Optimized Onboarding Funnel: Titles that are demonstrably capable of getting users intrigued within the first session are more likely to yield material results from paid campaigns that can deliver larger volumes of users on demand. Those still dialing in their first-time user experience (FTUE) can still benefit from paid UA, but at smaller volumes so as to not waste resources on acquiring users that aren’t likely to be well retained.
  • Predictable Monetization: Paid user acquisition can be effective for games with well-defined and predictable monetization strategies. If marketers have strong data to show how much revenue they can realistically generate per user, and have validated that performance at scale, they’ll have an advantage when brokering performance-based advertising campaigns, as they’ll be confident in what kinds of margins their campaigns will be able to affect.
  • Specific Audiences: If your game or app appeals to a specific niche or demographic, either due to a brand/IP affiliation or simply its specific functionality, some paid user acquisition channels that offer more specific targeting capabilities can allow you to efficiently reach that audience.

Features that maximize the returns of organic UA

  • Viral Design: Games and apps that have been designed from the ground up to stand out from the competition through sheer novelty of design are more likely to benefit from organic marketing efforts. Given the subjective nature of game aesthetics, this can often be a bit of a called shot, and it’s important not to fall victim to confirmation bias. That said, if you’ve heard from enough playtesters that you’ve got something truly unique on your hands, doubling down on building an active subreddit or Discord server can net substantial returns.
  • Competition: Any game or app with competitive features that allow users to go head-to-head is an ideal fit for organic user acquisition strategies. By cultivating a community of highly-engaged users, marketers can create an organic flywheel that drives word-of-mouth installs to fuel long-term growth.
  • Social Interaction: For all the same reasons that competition makes games and apps an ideal fit for organic user acquisition, social interaction is much the same. With user engagement buoyed by the energy of real-world relationships, marketers can yield greater returns from organic UA strategies that capitalize on that momentum.

Loyalty and user acquisition

No matter what balance of paid vs organic UA your growth strategy employs, mobile app marketers are under more pressure than ever to make the most out of the users they are able to acquire. With SensorTower data from 2022 showing almost every genre experiencing dramatic revenue decline¹⁰ and Newzoo¹¹ optimistically calling it a “corrective year”, loyalty is increasingly becoming the most heavily weighted variable when it comes to successfully scaling a profitable mobile game portfolio.

At Mistplay, our team functions both like an advertising platform by placing your game app in front of an engaged audience, and a retention partner by rewarding users for playing and spending in your game over the long term. By encouraging users to stick around in the same app, Mistplay gives app publishers opportunities to derive greater value from users through IAPs, ad revenue, or other monetization strategies. Check out our advertising solutions page to learn more.

👀 Related reading:  Loyalty is the new key to profitable growth for mobile games

Need to brush up on your user acquisition fundamentals?  Check out our comprehensive article, “Mobile user acquisition: The modern developer’s guide


  1. Statista, https://www.statista.com/statistics/276623/number-of-apps-available-in-leading-app-stores/
  2.  Zippia, https://www.zippia.com/advice/mobile-app-industry-statistics/ 
  3.  VentureBeat, https://venturebeat.com/programming-development/what-increased-user-privacy-means-for-mobile-advertising/ 
  4.  AdAction, https://www.adaction.com/blog/app-burst-campaigns 
  5.  Appsflyer, https://www.appsflyer.com/resources/guides/mobile-ad-fraud-for-marketers/
  6. Business of Apps, https://www.businessofapps.com/marketplace/user-acquisition/research/user-acquisition-costs/
  7. Pocketgamer.biz, https://www.pocketgamer.biz/news/80740/cost-per-install-for-hypercasual-games-hit-an-all-time-high/
  8. Privacy in targeted advertising on mobile devices: a survey, via SpringerLink https://link.springer.com/article/10.1007/s10207-022-00655-x
  9. Statista, https://www.statista.com/statistics/1263373/app-retention-organic-paid-installs/
  10. Craig Chapple, Most Mobile Game Genres See Revenue Declines in the U.S. During H1 2022 as Industry Headwinds Bite, August 2022
  11. Tom Wijman, The Games Market Will Decline -4.3% to $184.4 Billion in 2022, Newzoo, November 2022


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