Home The Future of Advertising in Applications

The Future of Advertising in Applications

The tense wait for Apple’s App Tracking Transparency (ATT) feature to finally go live is now over. This means that app publishers and advertisers can stop dreading what the novel privacy feature will mean for the future, and start coming up with creative solutions to deal with the industry-estimated ATT user opt-in rate of approximately 10%.

The Future of Advertising in Applications

The following are some of the ways publishers and advertisers can think about pivoting their strategy, so they aren’t hit so hard by the looming IOS user data drought.

Rewarded Video Will be the Next Creative Frontier

By the end of 2022, 79% of advertising will be consumed through video, so a lot of attention should be paid to the rise of rewarded video implementation into non-gamified apps.

Rewarded video

Rewarded video gets the highest cost per thousand impressions (CPM) because the ad is viewed for its entire duration in exchange for a specific tradeoff. Right now, rewarded video is something almost specifically associated with gaming apps – but a seismic shift is about to occur.

The most famous usage of rewarded video by a non-gaming app might be Spotify, which has been using it for years to provide a half-hour of ad-free music to their non-premium users in exchange for watching a short video.

Video ads

It’s foreseeable that apps that provide live streaming coverage of time-limited events might quickly apply this interactive model of running video ads. Users live-streaming a sporting event, for instance, might be offered the chance to watch a suite of ads from a major sponsor before beginning their streaming service to unlock access to better camera angles of the event – like a camera mounted on the end of a surfboard, or a drone’s-eye view of a football match.

Catalog apps for companies like IKEA

Another application could involve catalog apps for companies like IKEA. For example, large multinational consumer goods retailers like IKEA could partner up with a grocer like Lidl around the rewarded video so that when browsing one app, you can watch a video and be rewarded with a digital coupon for your next purchase at the partner business.

These sorts of partnerships stand to become extremely lucrative ways for publishers to collect additional customer data as well by integrating a short survey, or by adding an option for consumers to receive an additional discount by providing their email address.

Adspace Will be Molded to Fit User Habits

The pandemic shaped how users consume information on their mobile devices forever by creating the first global remote economy. Moreover, it accelerated the trend towards a world lived through our mobile devices. This is the future vision that publishers should focus on when they begin innovating new formatting products where ads can be placed.

Many new products will be designed and implemented to take advantage of trends like how the average Indian millennial spends roughly a third of their waking hours (1800 hours per year) glued to their smartphone.

One way that publishers might capitalize on this statistic, in particular, is by including things like ‘open’ and ‘close’ ads. These types of ads would be displayed on the loading screen as the app loads, or attached to an ‘Are you sure you want to exit?’ message upon closing.

Build for Android, Sell to the World

Publishers should note a recently published comprehensive report by FinancesOnline, which estimates that the three billion Android users outnumber iPhone users by more than three to one globally. Thus, if ATT solidifies IOS as the operating system of exclusivity and privacy, it also solidifies Android as the operating system of widespread market access.

Every company that makes smartphones has released less expensive options than even the cheapest iPhone. However, in an attempt to secure a growing global audience and wrest away future IOS users by building brand loyalty while offering increasingly expensive innovative models like Samsung’s Galaxy Fold, Apple’s competitors have well-established themselves in the developing world. Publishers and advertisers should be aware of this and think about shifting their efforts to target users of the more popular operating system on a larger scale.

Selling smartphones in developing countries.

Developers and advertisers can capitalize on the growing adoption of smartphones in Sub-Saharan Africa and pay particular attention to regional trends, like the widespread popularity of edtech apps. According to a report by Google, another thing to consider is mobile usage in Southeast Asia, which is the highest in the world.

The cheapest iPhone that Apple currently offers – the iPhone SE – is still far too expensive to compete against the kinds of phones companies like Nokia, Samsung, and Google sell to consumers in developing countries. With that in mind, developers should research what sort of apps are popular in places where smartphones are just now starting to make a widespread appearance.

This goes especially for app companies whose efforts to monetize their products for IOS have now been thwarted by ATT – like hyper-casual game developers, for instance.

“Sign-In to Unlock Exclusive Features”

Only in the coming months will developers and advertisers be able to assess the full scope of the changes IOS14 will make to their marketing strategies, how they track users, and how much data is still available to them from people who use Apple products.

Until then, publishers will start looking at ways of acquiring user data for themselves – possibly by building their own first-party identifier, similar to website cookies. Premium apps will likely also begin to implement ways of getting users’ email addresses when they download the app so publishers will have a user database they can then sell to advertisers.

Of course, not all users will be interested in giving up their personal email addresses without some sort of incentivization, so a reward system that offers users premium services or a piece of exclusive content that they would normally have to pay for could entice them to opt-in.

Tracking the consumer

If users can be incentivized into providing their email address, publishers can then track how many times the user opens the app, what they spend their time doing in the app, and how long they spend doing certain things in the app. These data can then be presented as a deck of information and offered to advertisers accordingly.

An app that sells used cars, for instance, might sell a suite of information about users who spend most of their time on the app looking at Mercedes-Benz’s to appropriate car dealerships located within a certain radius of the user’s geotagged location.

A new chapter begins

Apple users represent the kind of premium user that publishers want to get the attention of, so it makes sense that the death of personalized ads on IOS represents a horrifying prospect. However, the ad-spend money that once went into creating personalized, targeted ads isn’t going to evaporate – it will instead shift into new ways of working until the best solution is found.

This will likely include ads that utilize incentivization to get users to watch a piece of content or provide their email addresses. Developers will draw upon the valuable insights of large-scale user trends to realize new formatting products for advertisers – such as open and close ads.

The big shift for advertisers

The next big shift for advertising on the web and in-app will involve the emerging markets and a possible pivot to publishers spending more to target Android users. And as developing countries get access to better phones that can show ‘rich media’ (video), publisher monetization options are set to grow.

Finally and most importantly, the majority of time Americans spend on their mobile devices is taking place in apps, and that’s where we see the future as being very bright.

Image Credit: michael burrows; pexels; thank you!

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