Mobile continues to revolutionize our lives and has become a key driver of many businesses. With eMarketer forecasting that 53% of total advertising budgets worldwide are expected to be captured by digital in 2020, this year looks prosperous for mobile advertising. In fact, it is estimated that mobile ad spending will outpace all traditional ad spending by a factor of x1.2 worldwide by 2023.
There are several key themes we expect to evolve as we move into the new decade. Let’s take a close look:
Programmatic is getting a tremendous push due to the increased focus on app monetization and yield optimization. More and more industry players realize that in order to target desired audiences, scale relevant ad creatives, and measure ROI, their programmatic media buying strategy needs to be more data-driven and transparent.
Currently, 65% of ad budgets is traded programmatically. It is forecasted that the programmatic ad spend will grow to $98 billion in 2020—up from $84 billion in 2019.
Wider Adoption of Artificial Intelligence (AI) in Digital Marketing
AI is transforming the mobile advertising world and we expect the pace will not slow down in 2020. With the help of AI, marketers will understand their audiences better, which will lead to more customized and relevant ad messaging. From tracking the entire marketing funnel to collecting data on customer behavior and tendencies, it's an ideal feedback tool to be investing in right now.
Migration to First-price Auctions
While desktop transitioned to first-price auctions a while ago, 2019 was the year when mobile in-app inventory moved to first-price, with Google Ad Manager, Adcolony, and AppLovin leading the way. We expect wider adoption of the simplified auction model that will benefit price transparency and have undertaken steps to help our publisher partners maximize the value of their inventory without lessening the performance of our advertiser’s marketing campaigns.
The most important consideration is that first-price auctions are not something mobile performance marketers should fear. If your partner has an effective bidding strategy you can maintain performance even with the new pricing structure.
With the rapid growth of programmatic advertising, the demand for a better and more transparent ecosystem increases. Advertisers want to exercise complete control over their campaigns in real-time. Publishers, on the other hand, want to know how users interact with ads—whether the ads are disruptive or well-aligned with their users’ interests.
New solutions, strategies, and partnerships will happen this year as companies work on adapting to this transparent reality.
More Focus on Retargeting
Retargeting continues to be a focus of advertisers’ app marketing budgets. Between 2017 and 2019, the share of apps running retargeting has nearly doubled. In fact, in 2019, 1 in 4 of all conversions were the result of app retargeting efforts. We believe we will see more ad spend going into partners that are capable of doing both user acquisition and retargeting since they can guide the user through its entire lifecycle.
Personalization will still be important, but users are savvier now and are aware that their data is being used to target them. Approaches to personalization should become subtler and marketers will need to be more judicious about how they collect and use data.
Relevant Ad Creative
Irrespective of which strategy you use for marketing an app, the ad creative is the representation of your advertising campaign and we are sure you would like it to be the best possible. The past few years saw the spread of fake news and false information, and advertising was not spared, especially mobile programmatic. We saw a lot of ads that showed features that did not exist in the products themselves which lead to user irritation and dissatisfaction. The wisely-designed and data-informed creative ad has always been and will always be trendy.
2020 will be the year of enhanced user experience, personalization, automation, and AI-powered technology. Make sure you are keeping up with the rapidly evolving market and using the industry’s full potential.