Despite the advances made in buying digital media, marketers face significant challenges in effectively identifying and targeting the inventory that is right for them and delivering ads that are relevant and timely to acquire additional users. This becomes more complicated with the addition of mobile platforms. The following is a short review of the state of search, display, and mobile advertising as it pertains to application promotion.
My company asked 33 mobile application marketers and developers what type of advertising they used or tried (at least once).
Search: Making Progress on Meeting the Demands of App Marketers
Although search garners the largest share of online ad dollars, it wasn't the most commonly tried form of app advertising due to innate limitations, the survey found.
Google took the first step forward by allowing advertisers to target each mobile operating system independently and by carrier through keyword search. Being able to target by mobile operating system is valuable to app marketers who don't generally have their app available across all the different operating systems. Carriers will likely be the power users of the carrier data rather than app marketers as they try to steal market share from each other.
There's still room for improvement. Advertisers can't target by type of device (think iPhone, iTouch, or iPad) or the version of the operating system.
Google also offers the option (although it is opt-out) to block advertisers' ads from showing to users searching on mobile devices. This has the potential to improve the ROI (define) for Internet marketers should mobile search become a large portion of Google's search query volume. Imagine a company promoting a desktop app paying for clicks that were generated on mobile devices that their app wasn't compatible with - it would be a complete waste of their advertising dollars.
Desktop keyword search advertising is limiting for app marketers because none of the major search engines allow advertisers to target by desktop operating system, browser, or hardware specification. Imagine a Firefox browser plug-in marketer purchasing non-browser-specific search keywords when 70 percent of the impressions are viewed by users with incompatible browsers or a marketer of a Mac app wasting 95 percent of its ad budget on non-Mac users.
Display: Closer to Meeting the Demands of App Marketers
Many would argue that display advertising is less mature than search, but with the advent of ad exchanges and real-time bidding, marketers have more targeting variables to use when architecting their campaigns. Variables like browser, operating system, and connection speed are just a few of the options that are available in addition to demographic, contextual, or behavioral attributes.
For example, think of the value of knowing connection speed to an MMORPG company like Turbine that is looking to promote trial downloads for its extremely popular, free-to-play 2.8 gigabyte "Dungeons and Dragons Online" game. Unless the user has a robust broadband connection, receiving the trial download digitally from Turbine is impractical. Web ad exchanges could improve performance by offering these variables within their reporting tools, in addition to their bid-targeting architecture, to drive further value from targeting.
Mobile Advertising: What Targeting is Available?
Q Elevation is Quattro's ad serving solution that optimizes every ad impression delivered to a user. Publishers can drop in the Quattro software development kit and start serving ads based on the audience parameters that they specify. Quattro then uses the content and nature of the publisher's app to determine the most relevant ads to show to a particular user.
Advertisers can drive distribution by targeting by phone platform (Windows Mobile, Android, iPhone), so the app is targeted to the appropriate user. In addition, an advertiser may want to retarget certain users or prevent ads from showing to users who already installed the app.
Quattro positions itself against Google as being a "premium" network, providing full transparency into the publishers within its network. With Google and AdMob, an advertiser has no visibility into the sites or apps that they advertise on. Quattro chooses to focus on transparency, premium inventory, and optimization capabilities.
With the rise in mobile as an advertising platform, publishers face similar challenges in mobile that they faced on the desktop Internet. Large publishers are hesitant to make their inventory available on exchanges because of their lack of control over pricing. They want to charge the highest possible rate for what they consider to be premium inventory.
AdMob has the ability to target bundles of apps by category, such as news and entertainment. On the mobile Web, they have the ability to target by channel (communities, entertainment, etc.). With the announcement of iAd, these platforms will continue evolving as the market gets more sophisticated.
The Future of Mobile Advertising: Apple iAd Promising More Emotion, Interactivity
Steve Jobs introduced improvements available in the iPhone 4.0 OS at Apple's April 8 launch event. Jobs stated that "mobile advertising really sucks," so one of the major improvements is to make ads more interactive and emotional - combining the best of the Internet and television.
This is accomplished through the iAd advertising platform. IAd keeps consumers in the app, not forcing them to open a browser. Ads can take over the screen and offer the user multiple options - streamed videos, games, wallpaper, location-based info, etc. Apple plans to have more than 1 billion ad impressions by mid-summer if ads run every 10 minutes, giving app marketers a new source of revenue (60 percent revenue split with Apple).
More entertainment opportunities for ads are great, but there remains the problem of relevancy and disruption. No one knows what effect Apple's entry into advertising will be; however, they will have access to a lot of behavioral and demographic data that could be a powerful asset in relevant advertising.
More Relevancy and Less Disruption: Cross Promotion
Cross-promotion should be considered as an advertising option. Companies like AdMob for mobile apps recommend relevant applications when consumers are in the installation mindset. The way it works is analogous to displaying magazines or a pack of Trident in the check-out lane at the supermarket; as consumers install an app from various publishers, relevant applications are offered for their review. This type of advertising is relatively low cost, low friction, and allows for rich targeting to meet the compatibility needs of the app.
For example, Limbic Software used AdMob to cross-sell TowerMadness Zero on Tap Tap Revenge 3 to get them back into the Top 10 Strategy Game category in the App Store. Cross-selling is an effective distribution strategy, as offers are presented in a trusted environment to consumers who have a predisposition for similar products.
As more devices enter the marketplace and apps continue to proliferate, finding the most effective advertising platform will become paramount. If you have any tips on successful app marketing, please leave them in the comments below.
Meet Your Favorite ClickZ Contributors
Many of ClickZ's leading expert contributors will be at ClickZ Live, the new online and digital marketing event kicking off in New York (March 31-April 3). Hear from the likes of: Jeremy Hull, Lisa Raehsler, Andrew Goodman, Bryan Eisenberg, Mathew Sweezey, Aaron Kahlow, Stephanie Miller, Simms Jenkins, Jeanne S. Jennings, Dave Hendricks and more!
Rob Weber co-founded W3i in 2000, growing W3i to be a leader in app user acquisition and monetization. For 42 consecutive quarters the company continues to be profitable and has grown to over 120 employees. For more than a decade, Rob worked to create solutions to increase distribution, drive revenue, and heighten engagement for app developers, such as DeNA, Gree, Kabam, PocketGems, and many other indie and public developers. Under Rob's leadership, W3i recently launched a mobile offer exchange that includes partnerships with leading offer providers.
Rob's business philosophy is to provide a collaborative environment developing solutions that provide value to app developers, advertisers, agencies, and ad networks.
In addition, Rob shares his passion for apps, digital media, and entrepreneurship by serving on the board of several tech companies. Rob recently presented at MobileBeat, GamesBeat, GDC, GDC Online, APPNATION, iPhone/iPad App DevCon, and also judged Start-Up Weekends.
Rob is an angel investor in a number of game, social media, music, video, and mobile app start-ups.
March 19, 2014