By Craig Palli
Data is an integral and constant component of any successful app marketing campaign. But now, with new ways to gain and leverage data, user acquisition is changing for the better.
Until recently, app marketers worked with basic data like device type, operating system, time of day, or the network an ad was displayed on. While effective in yielding better results than other digital marketing initiatives, its value was notably improved by the inclusion of more comprehensive data.
In late 2012, Facebook introduced its mobile app ads, unleashing an ad product that allows app marketers to leverage information from the social network’s one billion-plus users. Everything from demographic stats to “likes” and check-ins can now be used to give app marketers a more precise means of attracting desired audiences.
And it worked—for both sides. Facebook recently reported an 82% year-over-year increase in mobile ad revenues; and app marketers rejoiced to have a new, extremely productive source for generating ROI. According to the study “User Acquisition for Mobile Games on Facebook,” app marketers advertising on Facebook mobile app ads saw on average an 11x improvement in conversion rates, a 1.4x improvement in purchasing rates, and a 28% improvement in cost per purchasing user, compared to other app marketing channels.
To say Facebook’s mobile app ads have revolutionized data’s role in app marketing would be an understatement. As an example, we have seen our client marketing on Facebook grow from zero to one of our largest channels in about nine months.
It’s important to understand that Facebook’s unprecedented success is not solely a consequence of its size. Yes, the vast user base helps, but the social network’s ability to segment users into millions of potential audiences is its key driving force.
For example, building lookalike audiences—audiences with attributes similar to your best users—is a very efficient way to find additional high-value users. Similarly, app marketers can take advantage of their own first-party data and have Facebook find audiences that share attributes with existing app users. These segmentation tools are the roots of the drastic changes in ROI experienced by app marketers. And it’s made possible because of audience data.
But the same data that allows increased segmentation now extends beyond targeting and to the ads themselves. With a more precise audience comes the need for creatives to be custom-tailored to a greater degree in order to be effective. Speaking at RTB Insider Summit, Michael Weaver, director of data strategy at Coca-Cola, said, “We’re starting to take our knowledge of data and analytics and apply it to what they do.” He continued, “[We] understand it’s not just one buy for one audience. We need to have 10 versions of this Diet Coke ad to appeal to 10 different segments.”
Data’s impact on both who is being targeted and how they see an ad is having a ripple effect on the industry. Not content to let Facebook corner the market on sophisticated target networks, industry heavyweights like Twitter, Google, and Yahoo are moving into the install app space. So what can we expect from the new entrants:
Twitter: No stranger to mobile, Twitter began as an SMS service and currently sees over 75% of its millions of users originate from smartphones and tablets. One of Twitter’s biggest advantages is the ability to use ‘intent’ data—real-time data based on what people are tweeting—to target ads.
Google: With the ability to compile information from search, an OS, a browser, shopping, video, home automation, navigation, and the ever-popular YouTube, Google has all the ingredients (read: data) for a winning ad product.
Yahoo!: They’ve been in the advertising business for over a decade—longer than anyone else listed—saw 430 million unique mobile users in Q1 this year, and can leverage data from a litany of personalized apps (MyYahoo, mail, games).
AOL: Owning an impressive bunch of properties including TechCrunch, The Huffington Post, DailyFinance, Engadget, AOL Mail, and Autoblog, AOL reaches about 86 million unique mobile viewers a month. In addition to using the data accrued across such a wide range of sites, their new app ads are designed to mirror the look of editorial content.
It’s apparent that leveraging the demographic information that users willingly provide on various social media and media sharing platforms—from current location, to college major, to interest in zombie television shows—is the direction the industry is heading. Facebook’s mobile app ads have a revolutionary capacity to put granular user data to work, ushering in a new era of data-driven app marketing. And it makes sense. Why try to guess what a potential customer is looking for when they will do it for you?
Craig Palli is chief strategy office of Fiksu.
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