The mobile app-install ad — an ad unit that directs users to download a mobile app — is closely identified with Facebook, the largest social network. But these ads have become so lucrative — driving one-third of all mobile ad revenue — that virtually every other internet property has created their own version.
Mobile app-install advertising is already found on Twitter, YouTube, and mobile ad networks like Millennial Media. Pinterest opened the door to the ad format recently with “app pins,” and no online publisher wants to be left out of the rush.
New and exclusive data from BI Intelligence finds that US mobile app-install ad revenue will top $US4.6 billion this year and grow to $US6.8 billion by the end of 2019, increasing by a compound annual growth rate of 14% from 2014. We believe mobile app install ads accounted for about 30% of mobile ad revenue last year.
Here are some of the key takeaways:
- Mobile app-install ads are becoming extremely popular ad units among different types of app publishers, not just game-app developers. App marketers — including e-commerce companies and a few brands — like these ads because they result in significant downloads and measurable ROI. Social networks and ad exchanges like them because they can sell the units at significantly higher prices than other ads.
- Easy-to-measure ROI drives demand. In many cases, once an app-install ad generates a download, everything a customer does in the app, such as “lifetime customer value,” can be attributed back to that specific ad.
On Facebook, mobile app-install ads cost significantly more than standard units, due to performance and targeting capabilities. The report includes CPM pricing and CTR rates compared to the average Facebook ad.
- Prices will hold relatively steady as supply and demand rise in tandem.The mobile install ad is a fairly mature ad unit at this point, and a good deal of competing supply is now available from Twitter and Google. But continued increases in demand for these ads among app marketers will keep prices from declining.
- Top mobile publishers and ad networks are competing fiercely for mobile app-install ad dollars, and for the favour of app developers. Twitter and Facebook are doing their best to lure app builders to their platforms and app-install ads with advanced ad analytics and developer tools. We estimate that mobile app-install ads drive one-third of all mobile ad revenue.
In full, the report:
- Forecasts spending on mobile app-install ads in the US over the next five years
- Puts total revenue in context of mobile ad spend and Facebook mobile ad spend
- Analyses how mobile-app install ads are priced and bought, and looks at how pricing and performance trends have changed over time
- Highlights the mobile app-install ad units available from major players like Facebook, Twitter, Yahoo, and Google
- Examines the different types of marketers that have put the ad format to use
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