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Guest Column: 4 Things App Marketers Need to Know About In-App Advertising: Rohan Patil

29-April-2016
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Guest Column: 4 Things App Marketers Need to Know About In-App Advertising:  Rohan Patil

Rohan Patil, Managing Director of AppLift India, Berlin’s leading mobile app marketing company, shares few tips about in-app advertising and how marketers can cut through the clutter to vie for consumer’s attention and retain users.

India’s appetite for smartphones has been rapidly growing for a few years now. The peak arrived in February 2016 when India became the world’s second largest smartphone market. Falling data prices and deeper mobile penetration have propelled India to become a lucrative market for mobile industry.

As consumers move away from web, there has also been a shift in the consumption pattern in the way Indians consume content on their phones. Whether it’s for watching videos on demand, hailing a cab, or shopping on the go, mobile apps are becoming central to the way content is consumed on the mobile platform. According to a panel at Apps India Conference 2015, apps usage in India has grown by at least 131%, surpassing the growth trends.

In this regard, in-app advertising is becoming an increasingly popular tool, as app marketers try to cut through the clutter to vie for consumer’s attention and retain users. Research firm App Annie predicts that by 2018 spending on mobile in-app advertising in ten key countries measured, including India, will be greater than spending on online search advertising.

Keeping in mind this huge opportunity available for mobile advertisers today, here are four things app marketers need to know about in-app advertising:

Decide On Your Model

Traditionally in digital advertising, CPM or Cost Per Thousand Impressions has been a preferred model, where advertisers would pay for every time their ad is shown to the users. Advertisers can also choose to pay using a CPC or Cost Per Click model, when a user clicks on their ad, usually the second stage of the funnel.

However, in mobile advertising, the conversion funnel works differently (depending on whether you want acquisition, retention or activation) so different performance-based buying models will directly impact your budget and revenue. CPI or a Cost Per Install model is increasingly being preferred over CPM or CPC as here an advertiser is only charged when a user actually installs their app, so it is considered as lower risk.

Identify, Define and Refine Your Target Audience

For app marketers, reaching out to relevant users is pivotal as it not only determines the costs and bidding model, but also helps them to reach their goals efficiently. Whether it is geo-targeting, behavior and interest based targeting, or demographic, how you identify, define and refine your target base will determine where and in which format an ad is placed, as well as the scale of your ROI.

Choose and Place Your Weapon Wisely

Each app works differently in the way how users interact within the app, and as an app marketer you will have to recognize what tactic serves the channel well. The context in which an app is displayed is decisive in driving better conversion rates as certain apps resonate better with their audiences as compared to others.

You can employ different formats such as banners, interstitials, pop ups, or videos, after deciding on their goals, as each will offer varying returns. For instance, banners are most common and cheap, but offer less engagement. Native ads, on the other hand, can blend in seamlessly with the existing content and offer less intrusive experience.

LTV Optimization and finding the most ROI-efficient channels

The lifetime value of users (LTV) is one of the most important success metrics to measure the performance and profitability. Acquiring users with higher LTVs is essential for the long-term success of your app and assessing these can give an insight into the impact of your campaign. Different channels may deliver differing LTV’s and thus it is important to recognize which channels to focus on for maximizing your ROI. For this purpose, you need to track post-install, behavioral events within your app which can serve as proxies for the lifetime value of the users acquired.

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