30-second summary:

  • Consumers seem more comfortable with full-screen ads than even five years ago. We can thank connected TV (CTV) for that because it has conditioned us to sit through full-screen ads even in an on-demand, non-linear TV environment.
  • User acquisition (UA) advertisers anticipated a decrease and had adjusted their budgets accordingly, but soon realized that wasn’t happening.
  • Advertisers care how much each install costs them, and they want to pay the lowest CPI possible, even if that sometimes means struggling with hitting the right audience at scale.
  • For ad networks to be able to optimize for performance metrics like retention, IAP and LTV, advertisers will need to be more open about their post-install data. Getting the right user and ROAS data into our system helps us identify which supply sources are the strongest for that advertiser.
  • Rather than having an entire team that focuses on one title, they are combining groups to handle multiple titles at once, generally increasing efficiency.

The first quarter of the year is typically when ad-tech companies like to identify trends, measure consumer sentiment and behavior and gauge both advertiser and publisher appetite for different types of media, campaigns and ad units.

They’re looking for key insights that will guide decisions about strategy and tactics to employ throughout the year, sure, but it’s also a reality check; a way of asking: “Where are we now?”

Any survey that was conducted before lockdowns began in March and the entire world changed likely can’t be counted on: time spent with media (dramatic spike!), ad spend (consumer lockdown = budget lockdown).

But as much as we talk about “the new normal,” there are some areas that haven’t changed – and that I don’t see shifting anytime soon, no matter what happens.

Here’s what I’ve seen over the past year and continue to see today, from my embedded position in this industry.

Video is still the budget hog

Talk about a piece of the pie: Video accounts for 42% of all campaign spend on average. While mobile app publishers are allocating some of that to in-feed and social video, the vast majority goes to full-screen. Why? Full-screen is the most effective and garners the most excitement.

Half-page or display ads just can’t compete with full-screen when it comes to user engagement. Even when clients test in soft launches, working with any vendor, the result is the same – full-screen is better.

Consumers seem more comfortable with full-screen ads than even five years ago. We can thank connected TV (CTV) for that because it has conditioned us to sit through full-screen ads even in an on-demand, non-linear TV environment.

That behavior is true within mobile apps, too. When you’re playing a game and finish a level, you know a full-screen ad is coming. The difference, though, is that in many cases that ad is interactive, whereas most CTV ads are not.

People still spending money on mobile apps

Speaking of consumer behavior, it’s also clear right now that despite economic uncertainty, consumers are still willing to spend money on apps.

UA advertisers anticipated a decrease and had adjusted their budgets accordingly, but soon realized that wasn’t happening. We’ve seen the same level of spending over the last few months, and some games have even seen an increase.

Cost Per Install (CPI) is still the dominant pricing KPI model

Advertisers care how much each install costs them, and they want to pay the lowest CPI possible, even if that sometimes means struggling with hitting the right audience at scale.

From the ad network POV, that means I am constantly looking at the supply side and adjusting in order to meet outcomes.

While pricing is still the most important factor when evaluating performance of a network and ad campaign, other highly rated factors are quality of acquired users, volume, targeting capabilities, and level of service from the ad network.

And it is true that user quality, as measured by retention and lifetime value, is not to be forgotten. So I believe we will see more focus on engagement metrics in the future.

Better sharing of post-install mobile app data 

For ad networks to be able to optimize for performance metrics like retention, IAP and LTV, advertisers will need to be more open about their post-install data.

Sometimes they can be hesitant to share, but for ad networks to be successful and hit targets, they need that information. Getting the right user and ROAS data into our system helps us identify which supply sources are the strongest for that advertiser.

Mobile app install teams are becoming more efficient  

Compared to a few years ago, when UA teams were swelling, today the number of teams of 10 or more has actually gone down. From what I’ve seen, this is due to the consolidation of teams within organizations.

Rather than having an entire team that focuses on one title, they are combining groups to handle multiple titles at once, generally increasing efficiency.

And efficient they need to be: On average, UA teams localize for 7 languages and optimize campaigns five times per week. It’s important to note that optimizing that frequently can backfire; it’s harder to hit scale.

Campaigns ideally need to run for 14 days straight to gather the right performance data in order to know which supply will perform better to hit ROAS goals.

What is helpful to optimize right off the bat, however, is creative. Users are more willing to click to install when they see a new campaign, so I’d encourage switching those up earlier on.

Trend or pillar? Plus, a note on privacy…

These are the five trends – or rather, pillars, that are still standing strong – that will likely be unfazed by any additional shifts this year. These are rooted so deeply in our industry that I can’t imagine them going anywhere.

One 2020 milestone that will be interesting to witness is the impact of the July 1 deadline for CCPA. How will targeting parameters change as this privacy regulation takes effect and other states begin to focus more on privacy, too?

I’m very curious to see how the market reacts, as this was a long time coming – and now right around the corner.

Liz Waldeck-Pinckert serves as AdColony‘s Director of Client Partnerships for North America. Liz works with high profile mobile app publishers to help ideate and execute engaging and unique mobile marketing campaigns and advertising content to scale their business across North America. After years helping publishers monetize effectively and with exceptional user experiences, her unique insights are helping push results for mobile developers on both sides of the coin. Follow her on LinkedIn.

The post Good news for user acquisition: Consumers are still spending money on mobile apps in 2020 appeared first on ClickZ.



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