[Originally posted on ClickZ on April 20th 2010 without the excerpts related to W3i]
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.
W3i 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 was not the most commonly tried form of app advertising in our survey due to innate limitations.
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 very valuable to app marketers who do not generally have their app available across all the different operating systems. My guess is that the carriers will be the power users of the carrier data rather than app marketers as they try to steal market share from each other. There is still room for improvement. Advertisers cannot target by type of device (think iPhone, iPod Touch, or iPad) or the version of the operating system.
Google is also offering 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 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 was not compatible with– it would be a complete waste of their advertising dollars.
Current 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% of the impressions are viewed by users with incompatible browsers or a marketer of a Mac app wasting 95% 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 who is looking to promote trial downloads for their extremely popular, free-to-play 2.8 gigabyte Dungeons & 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 in order to drive further value from targeting.
Mobile Advertising: What Targeting Is Currently Available
The two major players at this point are Quattro Wireless and AdMob.
Q Elevation is Quattro’s ad serving solution that optimizes every ad impression delivered to a user. Publishers can drop in the Quattro SDK 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 present 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 are advertising on. Transparency, premium inventory, and optimization capabilities are what Quattro is choosing to focus on.
With the rise in mobile as an advertising platform, publishers are now facing 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 to evolve as the market gets more sophisticated.
The Future of Mobile Advertising- Apple iAd Promising More Emotion as well as Interactivity
On April 8th Steve Jobs introduced improvements available in the iPhone 4.0 OS at the Apple Launch Event. Jobs states that current “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 TV. 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 over 1 billion ad impressions by mid-summer if ads run every 10 minutes giving app marketers a new source of revenue (60% revenue split with Apple). More entertainment opportunities for ads are great, but there remains the problem of relevancy and disruption. No one knows what affect 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 and the W3i Application Network for desktop 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 checkout lane at the supermarket; as consumers are installing 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 TapTap Revenge 3 to get them back into the Top 10 Strategy Game category in the AppStore. Likewise with the W3i Application Network, Exent Technologies used Freeze.com Living 3D Dolphins ScreenSaver to cross-sell Exent’s http://www.freeridegames.com/ app. Cross-selling is an effective distribution strategy as offers are presented in a trusted environment to consumers that have predisposition for similar products.
As more devices enter the market place 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.
April 29, 2010
