Mobile programmatic advertising remains a popular channel for advertisers around the world, despite it being affected by global macroeconomic changes in recent years.
Initially, success in mobile app marketing was measured by the number of ad clicks campaigns delivered. It then shifted to the number of people who installed the app. Now the emphasis is on the lifetime value (LTV) of users. With the advancement in mobile programmatic advertising, it is possible to target users with a high lifetime value, which allows advertisers to focus their attention on increasing app engagement and retaining users.
In this article, we will review the changes the programmatic advertising ecosystem has undergone and discuss the key concepts and our predictions for the upcoming year.
Mobile is Gaining Momentum
A closer look at the mobile programmatic advertising ecosystem reveals how it revolutionizes digital advertising. With digital advertising becoming more and more programmatic, the process of buying advertising space is creating more opportunities for advertisers. “Right message to the right person at the right time” is a key concept dominating the industry.
Consumers are more reliant on their cell phones than ever before, making mobile programmatic an increasingly effective way to advertise. As data.ai states, despite a decline in the macroeconomic environment, more time than ever before is spent in apps with mobile increasing its share of advertising wallet by 14% to 336 billion US Dollars in 2022. This share is expected to grow to a further 362 billion US Dollars in 2023.
Source data.ai
People are turning to their mobile devices to manage their everyday lives, hence app downloads and time spent on apps are registering standout results in the app categories ‘utility’, ‘entertainment’, and ‘finance’. The same report states that, even though consumer spending on apps dropped by 2% in 2022 globally, Taiwan, Brazil, Hong Kong, and Mexico registered growth of 15%, 22%, 34%, and 17%, respectively. Downloads also increased by 11% last year, with Pakistan seeing the highest growth at 35%.
Digital technologies will continue to significantly shape how advertising works in the coming years. Big data, artificial intelligence (AI), and automation are the terms and concepts trending now in the advertising industry. Advertisers have already leveraged these with the advent of programmatic advertising.
Largest Mobile Ad Markets Worldwide
The mobile ad market has grown at a rapid rate in the last few years. Statista states that mobile advertising spend is forecast to hit 399.6 billion by 2024. Let’s have a look at the largest mobile ad markets in the world together:
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The United States remains the leading mobile advertising market, with mobile ad spend estimated to be 165 billion US dollars in 2022. China follows – spending approximately two thirds of that of the US.
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Europe, in turn, has become one of the most dynamic digital ad markets in the world, with research, showing mobile ad spend will account for 53% of digital advertising spend in Europe by 2025.
- Asia-Pacific (APAC) stands out as one of the fastest-growing markets for mobile advertising. Japan – one of the first countries to adopt a mobile phone culture - is considered to be one of the most mature advertising markets in the world. It is estimated that mobile advertising spend will reach 1.6 trillion Japanese yen by 2024.
Today’s Programmatic Advertising Ecosystem: How does It Work?
Mobile programmatic advertising is the automated process of buying and selling mobile ad inventory with high efficiency. Programmatic advertising allows for greater audience targeting and a more automated placement process that increases efficiency allows for transparency, and delivers stronger performance results.
The past few years have been challenging for programmatic advertising. The industry has been affected by the economic downturn, instability, mergers and acquisitions, changes in privacy regulations, as well as the pandemic. These changes have influenced business decisions and strategies. They have also been a catalyst for innovation. One such innovation is the personalization of the customer’s buying journey, which has helped in the retention of high-quality users. This has become the go-to strategy for many marketers – nurturing users to improve their experience - which ultimately extracts more value from their ad spend and saves them spending on the acquisition of new users.
In the next year, we expect a bigger chunk of advertiser marketing budgets to go toward retargeting. Despite some advertisers being hesitant to invest (an average of 77% of mobile app users are gone after three days), it is a good way to find high lifetime value users, increase app engagement and retain engaged users.
Ultimately, the backbone to delivering strong campaign performance with the right fit is audience data. Data will help you to better understand your users, help you to segment them according to their type and needs, and allow you to create engaging ads by persona.
Final Thoughts
There is no doubt, programmatic is rising above these challenges and is a fertile ground for new opportunities for app marketers.
By adopting new and innovative solutions, app marketers can plot out their path to long-term success. To find out how Aarki can help you on your journey, drop us a message here.