Industry benchmarks for Mobile Apps (Freemium)
Consumer subscription apps target CAC payback around 6 months, which is aggressive but necessary given 7 to 12 percent monthly churn. CAC per paying subscriber runs $25 to $70 depending on channel mix, with UA on Meta and TikTok dominating and ASA filling the intent gap. ARPU is $6 to $15 per month and gross margin lands at 65 to 75 percent after the app store cut of 30 percent, or 15 percent under the small business program. At $45 CAC and $7 in monthly gross profit, payback is 6.4 months, so the store commission alone moves payback by more than a month.
Annual plan mix is the strongest LTV lever available to a consumer app. An annual subscriber collects 12 months of revenue upfront and churns at a fraction of the monthly rate, so shifting mix from 20 percent to 40 percent annual can cut effective payback in half without touching UA spend. Day 30 retention is the leading indicator worth instrumenting, since it predicts subscription renewal far earlier than any billing metric. Trial-to-paid conversion deserves equal attention, because a 3 point swing there changes CAC per paying user more than most creative tests ever will.
Frequently asked questions
CAC Payback Estimator for Mobile Apps (Freemium), answered.
Do app store fees count against gross margin?
Yes. The 15 to 30 percent platform commission is a direct cost of revenue and belongs in gross margin, which is why most subscription apps model 65 to 75 percent rather than SaaS-like 80 percent.
Should CAC be per install or per subscriber?
Per paying subscriber. Cost per install is a channel metric, not a unit economics metric, and installs that never convert are still acquisition cost.
How do I handle free trials in payback math?
Start the payback clock at first successful charge, not at trial start, and load the CAC of trials that never convert onto the ones that do.