In-app advertising: Challenges vs. opportunities

By Anton Ruin

The majority of reputable analysts and experts, engaged in marketing and advertising agree that mobile segment remains one of the most ascending and promising ones on the global market these days. The growth of smartphone and tablet production in addition to the increase of m-purchase rates worldwide allow speaking of a really “miraculous triumph” in the mobile ad niche. However, there is one segment, which doesn’t produce satisfactory results, as its efficiency rate remains relatively low – that is in-app advertising.

Believe it or not, but even the latest surveys reveal an international trend: almost as many as 90% of run in-app ad campaigns aren’t effective and profitable for a company, no matter which particular field it works in. The tendency is discouraging, but can it indicate the potential “death” of in-app ads in the nearest future?

The conducted research unveils some of the most significant challenges in launching a potentially successful advertising campaign in mobile applications, all of which are generally connected to app users’ behavioral patterns: people are more action-oriented, when they log in an app of any kind and will frequently treat a displayed banner as an “irritating interruption” of their activity. Given the historically smaller size of mobile devices (even the recently-released tablet models have smaller screens, than average PC’s or laptops); the ad often covers a large part of the app interface and becomes even more annoying to customers, as a result.

In this respect, the only way out for an in-app advertiser is to ensure the lowest “intrusion” level of the campaign or take a different approach by making it really cutting-edge and unconventional. In such a way, even if a certain viewer’s activity is interrupted, the thrill of seeing a worthwhile ad can overtake annoyance and irritation. The creative ad concept, reflected in one of the innovative mobile rich media formats can, thus, be considered somewhat a remedy.

One of the other major hurdles of in-app advertising is the lack of relevancy in many displayed ads. The situation is clear: if a company displays a “Try the new Beer” banner within a toy app, the probability of getting high CTR is very low. What is more, even the reached CTR tend to be incorrect: if an ad is large in size, a lot of customers will falsely click on it, simply trying to close or at least hide it.

It’s both surprising and discouraging that the aspect of ad relativity in contemporary in-app campaigns hasn’t become a strong point even during the past few years in spite of colossal improvements in mobile targeting technologies.

Is there any solution to a problem? There is: it’s, actually, obvious and includes several recommendations:

– Ensure that the app category matches the advertised product (e.g. offer a car in automotive apps, display apparel in apparel apps, etc.).

– Provide customers with a so-to-say “app related message” in addition to advertising a product (e.g. show a game install ad every time a person gets to the new level in an already downloaded game and include some congrats in it). Such messages won’t either annoy app users or interrupt their gaming process.

– Make sure to apply the whole set of available targeting options (geotargeting, app download history, if provided, etc.) to reach the most high-value audience.

No matter how frustrating the previously shown results of in-app advertising may seem, a lot of analysts remain optimistic in their forecasts for the future. In this respect, the constantly ascending amount of global mobile ad spending allows predicting considerable improvement of efficiency rates in in-app advertising. It’s as simple as it sounds: the companies are ready to invest more (read: do whatever it takes) to convert their weak spots into the strong ones.

About the author

Anton Ruin is Epom’s CEO.  

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