71 per cent of developers feel that ad networks exaggerate eCPM figures

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That’s according to a new report from social games network PapayaMobile, the company behind the mobile ad and cross-promotional platform AppFlood. The survey, which canvassed 1,000 independent studios to find out how they feel about the various app advertising and marketing channels, reveals some uncomfortable statistics:

  • 71 per cent of respondents felt that ad networks exaggerate eCPM rates (effective cost per thousand impressions)
  • 48 per cent of developers felt the acquisition cost was too expensive when asked if the investment in mobile marketing was good value for money

To give this some context, 78 per cent of those surveyed have a marketing budget of $5,000 or less per app, 12 per cent have between $5,000 and $10,000 and 10 per cent have more than $10,000 per app. 73 per cent of developers are happy to use a DIY approach to marketing as cost and trust are such major problems, preferring to purchase and book their own media for campaigns rather than hand it over to a specialist planning agency. We put the story to MEF members and the mobile industry for their thoughts on the ramifications of the PapayaMobile report findings and what they could mean. If you’d like to contribute a comment to this article then contact us at editorial@mefmobile.org

Edward Laws, GM Performance Advertising EMEA at InMobi

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The findings from the survey reveal there are still instances of developer skepticism and frustration with aspects of the mobile advertising market which should be noted by service providers in this space.  It is a clear reminder about the key factor which should underpin a successful developer / network partnership: Trust.

The essence of the frustration centres around a ‘black art’ in how networks are billing developer studios with supporting measurements that lack full transparency and clarity . When there is doubt over the visibility of ROI on mobile advertising campaigns this will slow the pace of growth of the larger market.

The survey shows that developers perceive they are given over-optimistic expectations of yield they can achieve when monetising applications and CPI’s (cost per install) they can achieve when acquiring new users. On the user acquisition aspect, selecting the most appropriate campaign metrics can often be overlooked which given the level of tracking technology available is actually a very avoidable issue. The cheapest download isn’t necessarily the most profitable acquired download! InMobi always stresses the importance of acquiring high life-time value (LTV) users enabled by using the right campaign tracking solutions.

When thinking of brands and the wider marketing industry who are increasingly adopting more dynamic and interactive advertising routes on mobile devices – it’s absolutely crucial that this fundamental shift is not undermined by a lack of trust between those charged with creating the campaigns and those charged with distributing and monetising them. If this happens, we all stand to lose out.

Marcus Tan, Managing Director – Asia Pacific, Smaato Inc

marcustan2There are many ways how an app is being promoted to secure more users but app developers need to realize that when they develop an app and if they intend to monetize the apps via payment or advertisement, they need to properly develop a plan with a budget.

Apps are no longer a local product or services, Global App Stores have opened up the opportunity for it to reach a global audience that is not restricted to a particular region or country.

Given this global phenomena and opportunity for Apps to be used by a global audience, App developers who are keen to promote their apps must consider if:

  • Global Partner – When choosing the right partner (Ad Network/ DSP or Ad Exchange) whom you intend to use to promote your App, you should consider if this partner is a truly regional or global player with a proven track record that will help you to target and reach a wider audience globally?
  • Know your App – How are your Apps positioned in the global app stores and who are your targeted audience or consumers who will use your app? Do you know your user?
  • Know your competitor – Who are you competitors both locally and regionally and how is your apps stacked up against them?
  • Know your Markets – What is the average eCPM that others are paying to promote their similar apps?  (Please remember that it differs from market to market where each one carries a different maturity and geographic dynamics so there is no “one-size-fit-all” solution.
  • Use RTB to buy– Did you consider using programmatic buying via RTB to reach out to buy the right audience to increase users for your App?
  • Plan your execution – Most importantly, just like how you market any other products, develop and plan your execution, choose the right partner (Ad Network or DSP or Ad Exchanges) and define your targeted audience and promote your App to these audience to attract more users to your App!

Sephi Shapira, CEO and Co-Founder, Massive Impact

Sephi ShapiraHistory’s Lesson for the middlemen – Looking back to the most significant past information revolution, automated printing, may teach today’s ad networks a lesson. The ad networks of the printing revolution, the early printers emerged as a new segment and quickly became stars, growing to become some of the largest corporations in Europe and revered worldwide. By the time the printing technology became main stream, these printers with their core focus on technology lost their glory and profits and were replaced by what we call today publishers. These publishers core focus was on creating actual value to consumers, not technology transferring data from point A to point B.

The new publisher revolution – To gain center stage, ad funded publishers must first recognize the motivation of the middleman. Ad networks’ technology optimizes for clicks, as they have no incentive to track advertiser’s conversions or share consumer information that otherwise could be spun into gold. This non-optimal relationship de-values inventory and obstructs additional profits for the publisher and negatively impacts user experience.

If you’d like to contribute a comment to this article then contact us at editorial@mefmobile.org

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