An Adotas Q&A with Oren Kaniel, Co-founder and CEO of AppsFlyer explores.
A: Within the last few years, the ability to effectively measure mobile advertising campaigns and marketing activities has come of age, and a number of the challenges that marketers face have been resolved. There’s the cross-device and cross-platform challenge of recognizing users as they move from their desktop to their smartphone to their tablet and maybe even to their TV. There’s also the ROI challenge of being able to track the revenue and complete lifetime value of app users so that marketers can attribute it to specific advertising sources. And then there’s the last-touch attribution challenge, where most attribution providers only credit the last advertising source that a consumer interacted with, leaving marketers in the dark on the impact that other sources might have had in influencing that consumer. That said, the mobile and digital space is obviously always rapidly evolving. And while we’ve developed technology that addresses many of these challenges, there’s always more to do.
Q: What are the primary metrics mobile and app marketers should be measuring?
A: At the end of the day, marketers want to know whether their campaigns had a positive ROI, so that’s probably the most important metric. And of course, the two metrics that go into calculating ROI are also very important: on the one hand you have ad cost, which can be represented as Cost Per Install or Cost Per Acquisition, and on the other hand you have lifetime value (or LTV) or even predicted LTV. Retention is also very important because it gives a good idea of how healthy your app is. Retention can be measured in terms of intervals such as Day 1 Retention, Day 7 Retention, Day 30 Retention, and so on, or it can be calculated as a percentage of your daily users in relation to monthly users (or DAU/MAU). And then there are all sorts of granular, vertical specific post-install events (such as “add to shopping cart” for m-commerce apps or “level cleared” for gaming apps) that must be tied back to the acquisition source in order to paint a clear picture of ROI.
Q: Why do you think many mobile marketers aren’t measuring the ROI of their campaigns?
A: In a lot of cases, they just don’t have the tools to connect in-app data to advertising and marketing data, so they can’t calculate ROI effectively. In other cases they don’t have an accurate sense of how much revenue users are bringing in. But the bottom line is that in this day and age, there’s no longer any excuse for not measuring ROI.
Q: More and more app developers are looking beyond their regional markets in an effort to go global. What advice do you have for taking a local app to a global level?
A: Our first bit of advice is to make sure you truly understand the new market you are breaking into. Get to know the major players in the ecosystem from an advertising and publishing perspective, and of course get to know your target audiences as well. Be sure to localize your app as much as possible by translating it into the local language at the very least and, if possible, updating it for cultural traits as well. Also be sure to update your app store description, marketing campaigns, and maybe even your app icon and screenshots. What works for one region might not necessarily work for another region, so it’s important to get to know local behaviors and preferences and cater to those as much as possible.
Q: What advice do you have for marketers when it comes to choosing which media sources to use in their campaigns?
A: The best advice we can give when it comes to choosing media sources is to measure every campaign very closely and pinpoint whichever sources work best. It comes down to marketers’ ability to test, measure and optimize campaigns effectively. Some sources might work well for certain campaigns but underperform for others, so it’s very important to continuously test sources for yourself and analyze the results very closely in order to optimize and scale your activities quickly. We also recommend that marketers break down their campaigns as much as possible, looking at it at the advertising level, publisher level, ad group level, and so on in order to get more specific insights.
Q: What about mobile ad fraud? How big a threat is it, and what can be done to combat it?
A: Fraud is a very real and growing threat to mobile advertising. There is an estimated loss of $1.3 billion annually in mobile fraud (compared to $3.2 billion in desktop fraud), according the IAB. We are still in the relatively nascent stages of the mobile and app advertising sector’s growth, and fraud is a concern that is holding buyers back from jumping in with both feet. As an industry, we have to do better at combating fraud through a combination of better technologies aimed at identifying and fighting it. We also need better agreements from the important players in the ecosystem — from advertisers and agencies to publishers and tech enablers — to collaboratively come up with best practices on how to prevent fraud from happening in the first place. We ourselves have been fighting fraud since 2013, when we started working with several of the industry’s largest advertisers. Our comprehensive fraud solutions utilize the industry’s largest mobile marketing database to deliver the tools and capabilities the modern marketer needs to actively prevent mobile fraud. While the liability of removing fraud from authentic traffic lies on the seller (the network), we believe it is our responsibility as an attribution analytics provider to help in protecting our advertising partners from fraud. In fact, we have removed networks from our platform because we believed they were intentionally delivering fraudulent installs. At the end of the day, everything we do comes back to ROI, and fraud must be deterred because fraudulent users don’t make real money transactions.
Q: Everyone knows last-click attribution model is flawed. What is the best way to make up for this?
A: At AppsFlyer we’ve been trying to move the industry to more of a multi-touch and view-thru attribution model that accounts for every ad source that contributed to a consumer’s decision to download and engage with an app, instead of just the last ad source that they clicked on. This gives advertisers a much more accurate sense of how effective each of their campaign sources is, and it will enable them to conduct more effective campaigns going forward. We launched multi-touch and view-thru attribution nearly a year ago, so the technology is in place. Now it’s just a matter of educating the industry that this is a superior way to measure campaigns. Even though it’s not quite so simplistic, multi-touch attribution is more nuanced and ultimately more accurate, so most marketers have come to embrace it.
Q: With engagement becoming more important than ever, are re-targeting and re-engagement efforts growing?
A: Absolutely. With user acquisition rates climbing and competition for consumer mindshare increasing steadily, more and more app marketers have shifted their focus to include more re-targeting and re-engagement campaigns. These marketers realize the value of qualified prospects and customers. It is much more cost-effective to market to consumers who have already demonstrated interest in your app than to continue casting a wide net in an effort to find more potential users. Re-targeting and re-engagement campaigns are also much easier now, since our clients already have all their data and segments with us and it is very easy for our clients to run re-engagement campaigns with all the major players like Facebook and Google, based on their data. In addition, our clients can use advanced features like Facebook’s “Lookalike” service based on that data.
Q: With marketing becoming more integrated across different channels and platforms, how do you see the measurement space taking shape in the next 3 – 5 years?
A: The marketing and ad space is in a state of extreme flux right now, and it’s important that measurement keeps up with it. For instance, it will be interesting to see how the Internet of Things, VR and other innovations affects marketers over the next few years, as I’m sure both will pose tremendous opportunities but also new challenges. Marketing will also continue to get more personalized and contextual, meaning that measurement tools will have to make sure they can track the effectiveness of increased pinpointed targeting and personalization. And of course, there’s always the unknown. As a provider of measurement tools, we are always making sure we’re ahead of or quickly responding to new technologies and new techniques that emerge. In other words, we want to measure everything that is measurable, in order to provide the primary set of data every marketer needs to have everyday.
About Oren Kaniel / CEO & Co-Founder of AppsFlyer
Oren is the CEO & co-founder of AppsFlyer, the market leader in Mobile Attribution Analytics. Oren holds a BA in Computer Science, Cum Laude, from the Technion, and an MBA from IDC, as part of an exchange with the Wharton Business School.