Exciting Trends in Mobile App Advertising
There is no shortage of apps in the modern marketplace. In fact, there are millions available – with this number projected to grow steadily over the next few years, perhaps even reaching 5 million in the Apple App Store alone by 2020. It’s a great time to be an app user because it seems like there’s truly an app for everything, whether you want to track your fitness regimen or order groceries using your phone.
But for marketers, the pressure is on. Not only is it important your app delivers a great user experience from start to finish, but people must be able to find it in the first place. Paid app-install campaigns get eyeballs on your ads. But the very nature of mobile app advertising is evolving. It’s important to understand the exciting trends in mobile app advertising so you can make savvy decisions regarding ad spend and strategy.
What is programmatic advertising? This method utilizes computers and, often, machine learning, to automate the ad buying process, and generating ads in real time based on user data. It’s likely programmatic advertising will increase dramatically as it continues to overtake manual ad buying. One factor contributing to this trend is a constantly growing audience of mobile users. As more people integrate mobile devices into their daily lives, marketers have a larger pool of audience members to target with their messaging.
One major advantage of utilizing programmatic advertising is that machine-learning algorithms can continually refine ad campaign creative rather than marketers having to execute trial-and-error attempts. This process, called dynamic creative optimization, cuts down on A/B testing and streamlines ad spend. The algorithms consistently work toward serving ads that perform better, freeing up human marketers to focus their attention elsewhere.
The most advanced mobile app advertising campaigns programmatically assemble dynamic ads. These ads are highly personalized based on consumer data like age, gender, location, device type, OS, mobile behavior and more. So, a 50-year-old Android user from Wisconsin would see a completely different ad than his daughter who’s half his age, lives in New York City and uses an iPhone. The key is showing users content that appeals to their lifestyle and preferences rather than a generic ad meant to capture broad traffic.
Not only do consumers prefer personalized advertisements, but they’re starting to expect them. One study found that 71 percent of consumers prefer ads tailored to their interests and shopping habits over ones that are not. As this becomes the norm, static ads will stick out like a sore thumb because users are accustomed to seeing themselves reflected back on their mobile devices.
Another trend to note is a shift away from Cost-Per-Install (CPI) campaigns toward Cost-Per-Action (CPA) campaigns. Utilizing a CPI model, marketers pay ad publishers based on how many installations their app gets through paid ads. The goal is to drive the most installs for the least expense. CPI is easy to track and makes it easy to see how much each install is depleting from your ad budget. But there’s one major shortcoming: “A majority of the users you gain from the volume-based approach have a very low lifetime value.”
A CPA model, on the other hand, requires payment only when users engage in designated post-install events. While it is more expensive in general to acquire quality users, it also de-risks ad spend to pay only for users who engage. Users who have engaged in one action – like creating an account, signing up for a subscription or making a purchase – are more likely to re-engage with the app and continue getting value from your app over time. So, starting with a CPA marketing model aims to attract these engaged users from the get go.
When you’re marketing an app, keep an eye on trends and try to remain on the cutting edge. If you don’t, your competitors surely will.