With an estimated 3 million apps now on offer across the world’s 5 biggest app stores, anything that helps developers cut through the noise and find the right audience for their app is going to be welcome.
Platforms such as Google, Facebook and Apple have been making improvements to the way they offer mobile app install ads, with the aim of improving performance and winning market share of ad spend.
App install ads are getting increasingly sophisticated, with improved targeting, and the competition between major advertising platforms may ultimately benefit app developers.
With over 4 million apps in Google Play and the App Store, it’s tough getting your app to stand out in a crowd. To help get their apps noticed and persuade users to download them, developers usually turn to running mobile app install ads. In fact, app installation ads are so popular that they recently accounted for 25% of all mobile ad spend in the US.
Last summer Google reported that it was now responsible for 3 billion app installs, following colossal growth in this type of ad spend in the spring of 2016.
It’s still Facebook that leads the ad install field but it’s thought that Google could soon overtake as the primary install channel for mobile apps.
The recent surge in Google’s app installs performance can be attributed to changes in Google’s ad format options, which have been simplified so that publishers can more easily access the different formats including the display network, YouTube ads and of course AdWords.
Google now also offers ads in the Play Store itself. Advertisers had previously favored Facebook because it offered simplicity.
Because Google has now simplified its ad format options, and as it continues to offer greater reach, some advertisers are shifting spend from Facebook to Google.
In addition, Apple is getting more involved in the mobile app ad install game – it now runs ads in its own app store to drive downloads. What’s happening is a shakeup in the app advertising landscape, with advertisers now changing their share of spend between platforms.
Platforms are increasingly competing to retain ad revenues, and this competition is ultimately likely to favor the advertisers. Google, Facebook, Apple and other ad platforms are fighting to offer the best interface and the most precise targeting to win the share of spend.
Facebook and Google slug it out
Many developers report better performance from Adwords compared to Facebook ads, with a lower cost per install and greater volume of traffic. Installs from Google are also shown to have better retention compared to those from Twitter and Facebook. No wonder then that many developers are switching a larger share of their ad spend to Google.
Facebook has implemented ad option changes on its own platform that enable publishers to bid for users likely to complete specific actions within the app after download. This means Facebook is supporting advertisers in identifying and reaching high-value users.
It’s something that developers have been asking for, and hopefully, the changes really support app developers by delivering the right customers to the right apps.
But without an app store of its own, Facebook is struggling to keep up in the app install race.
Are its recent changes to ad options enough to compete against Google, as the latter gains an increasing share of ad spend?
What’s clear is that the mobile app installs ad market is getting more sophisticated, with better audience targeting on offer from major players.
New ad types (presently offered by Google) enable users to trial a mobile game before they commit to downloading it. Google’s Universal App Campaigns initiative offers customized call to actions, and a cost per action bidding model.
Presently the competition is focused on automating targeting, using machine learning to tweak campaigns and optimize performance, and generating creative that can optimize campaigns for the highest value users. The race is on to offer advertisers the most efficient way to spend ad revenue.
Snapchat enters the mobile app ad market
There are also new players entering the market. Snapchat, the rapidly expanding picture messaging app and media platform, is contemplating the mobile app install market as it matures its advertising products.
This popular and increasingly influential platform has some serious work to do to improve its ad offering: the ad install space is one area it will need to conquer as part of maturing its monetization model.
It’s thought that Snapchat will build a self-serve ad product and open up its ads API in the first half of this year, giving advertisers the ability to buy app-install ads directly and make campaigns easier to manage.
Very early tests by the Acorns micro-investing app saw high install rates, although the new advertising model is yet to be properly launched and return ‘real’ results.
Self-serve ads tend to be associated with poorer quality campaigns, and it remains to be seen how Snapchat will transform its advertising model.
Snapchat ads have a reputation for higher engagement rates, so the platform could have much to offer developers seeking a place to advertise. Unlike Facebook, Snapchat advertisers don’t need to maintain a profile on the platform – which could be seen as an advantage by developers who want downloads without the hassle of managing a long-term social media presence.
It’s thought the app install app market will be worth over $7bn by 2020 – double the spend in that market in only 2014. With key players battling for ad spend, new developments are afoot.
These may benefit the advertisers if they result in a more efficient allocation of ad spend. If you’re an advertiser, it’s well worth keeping an eye on new developments in the market rather than sticking to your existing ad practices.
Your ROI may improve if you keep an open mind about where to allocate your spend.