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5 Pitfalls of Paid Mobile User Acquisition to Combat with a DSP

Aug 23, 2019  ·  12 min read
Kate Novatska
Kate Novatska, Marketing expert at Epom

Mobile app market grows by tens of billions each year, and so do the struggles of mobile marketers. Advancing your strategies of mobile user acquisition, you can break the cycle of inflated CPMs and little-to-zero app installs.

To be precise, worldwide mobile app revenues rose from $285.3B in 2017 to 365.2B in 2018. With the average user spending in app 2:57 vs. 0:26 hours in browser, there is little wonder that developers are shifting to mobile in their pursuit of higher yields.

Once the app is done, the burning question is how to get as many installs as possible. Yet, basic mobile traffic acquisition techniques seldom work perfectly alone. You could make your app more visible in Apple and Google Store, promote it on social networks, publish content to PR it in popular media, but you're still not there.

At that moment, paid methods of app advertising come into play. The conventional process of mobile user acquisition as part of a paid strategy looks as follows:

  1. Mobile developers contact an ad network with a request to find suitable ad inventory.
  2. Ad network analyzes its pre-defined segments and matches the developer's ad with the publisher's inventory slot based on limited targeting data.
  3. The ad is served on a publisher's website to the end user.
  4. The user sees you ad and MAY or MAY NOT click and download the app.
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This process seems to be alright, at least to the untrained eye. You pay for ad placement, the ad is shown to your potential users, you win a slight chance for another app install.

But when you dig deeper, you discover several mobile acquisition challenges carried along with ad networks and their mechanism of work. In fact, you have little-to-no control over your campaign success while dealing with advertising networks. You can regulate neither costs spent on each placement nor measure the effectiveness of each traffic source.

To be in the driving seat, you will inevitably need your own mobile user acquisition tools instead of middlemen who decide where to place your ad and where not. And while you can use ad servers and ad exchanges to personalize your media buying, the most sophisticated and cost-effective tool is a white label demand-side platform.

“White label” means that you purchase software with a one-time payment and spare yourself from undue royalties to intermediaries like networks, agencies, and SaaS companies. On top of the mentioned benefits, you unite each and every advertising activity in one account, get your hands on all the user data, and buy unique users rather than shady installs.

“This white label mobile DSP sounds like a cure-all technology, but where are the proofs?” — You may be wondering right now. To make it crystal clear, let's identify 5 pitfalls of your mobile acquisition strategy you are likely falling into. And of course, figure out how to leap over them with the help of a white label DSP.

What is a Mobile White Label DSP and Why You as an App Advertiser Benefit From It

Simply put, a white label demand-side platform (DSP) is a platform that automates media buying and matches your ad creative with the most suitable ad inventory. It's based on an RTB technology, which implies a real-time auction. The outcome of each auction is apparent: the highest bidder wins the impression. This process is also called programmatic media buying, meaning there is a program involved.

A DSP does not constitute an automated ad network. Unlike the latter, it allows you to set you own CPM, optimize campaigns in real-time and directly trade with multiple supply partners.

Read more in our A to Z guide on how to advertise with a DSP

read more

In other words, you buy impressions that convert instead of paying for a pig in a poke.

Speaking of mobile user acquisition, it makes sense to market your app on the mobile web or even inside other apps. That's why app advertisers might prefer a mobile demand-side platform, a DSP that helps to find exclusively mobile publisher's inventory.

And now, let's move on to the juiciest part: common mobile acquisition challenges of mobile advertisers and ways to overcome them with a white label DSP.

Mobile Acquisition Challenge #1: You Feel Like Overpaying

The key word here is “feel like”. Ad networks don't let you know whether you really overpay, providing only aggregated data in the form of average. This sole cost indicator doesn't get you any closer to knowing what's going inside and how much you contribute to each source of traffic.

Next, the use of multiple networks or platforms doesn't benefit you in any way. Bidding several times for the same inventory, you end up competing with your own bid and overpay in the result. Traffic coming from various networks can be recurrent, so you basically pay for the same users again and again.

Fast Fact: On average, advertisers use 7 ad networks to run their campaigns. Lastly, ad networks mark-up inventory price, as they make their profits from your mobile media buying activity. So if you bought, let's say, 10M impressions for $2,000, in reality their cost was like $1,800 in case the ad network's revenue share is set at 10%. If there was one more ad network involved, the real price of impression would drop by another 10%, and so on.

Solution:

The first thing on your to-do list is to stop using multiple networks and focus on a single platform that could provide you with an endless flow of mobile traffic sources. The solution would be using your own mobile DSP based on ready-to-go white label technology since it unites many ad exchanges and SSPs under one roof.

Disclaimer: If you haven't established connections with any SSPs or ad exchanges yet, you can connect a DSP to Epom Ad Exchange and start serving ads straight away.

Mobile Acquisition Challenge #2: You Got Sick of Fraudulent Traffic Sources

Fast Fact: According to DataVisor, 15 out of 100 installs are fake. No matter how prominent and reputable ad network is, there is no guarantee that mobile traffic coming from their sources won't be fraudulent. This fraud rate is prone to fluctuations, sometimes bringing up to 90% fake installs from the same trusted network. This makes fraud probably the most widespread mobile user acquisition challenge for all market participants.

Most networks don't have an integrated anti-fraud system to detect bot traffic sources in real-time. And even if they do have it, fraudsters usually find new ways to get past the protection. Moreover, your request will go through a long chain of intermediaries before reaching the final source of your traffic. The more hands you have on your advertisement — the higher the chance it will fall into the hands of fraudsters.

A CPI pricing model are not the best in terms of mobile user acquisition. Clicks and installs can be imitated by bots and therefore bring no conversions to the house.

No one is immune to this. According to the Appsflyer study, fraudulent app installs cost mobile advertisers $2.3B per half-year.

Fraud rate of top ad networks

Solution:

With a mobile DSP, impressions can come from fraudulent sources as well, but it's easy to reveal their questionable nature. In a DSP dashboard, you can assess the quality of your traffic by tracking other rates such as these same CPI and CPA, not relying on them in terms of payment.

Another benefit of a white label mobile DSP is that you shorten the media buying chain to only two participants: your DSP and publisher's SSP or ad exchange. You have a manifold smaller risk to bump into fraudsters because you know exactly who is your traffic provider.

Mobile Acquisition Challenge #3: Your Reports are Non-Exhaustive

Even though you can derive some data on your performance from an ad network, it's still quite limited. For example, it can be a source ID, click ID, or an aggregated average CPI for all sources. You get an individual link for each campaign and put macros in there to receive specific metrics. The publisher does the same stuff.

But who wouldn't want more detailed analytics to make the most of their campaigns? Unfortunately, ad networks are not cut out for timely data delivery to every client.

What's more, another obstacle on your way to better mobile user acquisition is data fragmentation.

Let's imagine you use 10 networks instead of just one. Each of them sends you separate reports, while you are running the same ads targeted at the same users at all of them simultaneously. Guess what happens next — you get 10 different reports about the same mobile media buying campaign with no chance to consolidate them.

Ad networks and even ad server platforms are not reliable in terms of analytics. Only few of them have a real-time reporting feature and you can only guess when your performance update arrives. It can happen anytime — either in one hour or in a couple of days.

This causes many inconveniences. You can't update your campaign options right after the mishap. You won't even know that something went to the dogs until you see your wasted million impressions in exchange for zero installs.

Solution:

The only mobile media buying tool capable to send you reports in real-time is a demand side platform. All your rates and metrics refresh instantly after any change occurs.

Fast Fact: Epom mobile DSP updates reports every 0.2 seconds after each conversion. So if you want to have live analytics at your service, a white label mobile DSP is your perfect weapon to enhance your reporting power. Reports are aggregated and therefore it's quite easy to analyze them and take further actions.

Mobile Acquisition Challenge #4: You Lack User Data Transparency

Ad networks and self-serve tools that don't belong to your company can't tell you where the mobile app traffic you buy is received from.

Let's start with the first ones. Being companies with their own interests, ad networks are practically “black boxes” for advertisers. They use pre-defined segments of audiences and match them with your targeting preferences. Data you receive back from publishers is very limited, making you unaware of ad spend per source, a number of fake app installs, and even basic audience data.

Fast Fact: Data represents about 20% of all US marketing spend. Proceeding with this critical data issue, we should say that self-serve mobile DSP platforms (the ones you haven't built on your own and only have advertiser's access to), still don't give you full freedom of data transfer. These DSPs can integrate with third-party DMPs and other data sources, but they don't show you ALL data about the user who saw your ad unit.

Solution:

To beat this mobile user acquisition challenge, you may need more data about your audience to minimize serving irrelevant impressions. How? Use your own mobile DSP based on white-label software and start collecting bidstream data.

Bidstream is all user data collected during a real-time bidding auction. In the case of mobile user acquisition, those will be mobile apps and websites that offer mobile inventory for sale. This data includes more than 50 attributes including a type of ad placement, mobile device, demographics, type of content, and others.

White label DSPs collect all data regardless of the result of an RTB auction. Even if you lose, you'll be able to analyze data collected during this campaign for future optimization. 100% user data transparency at its finest.

Mobile Acquisition Challenge #5: You Spend Ages on Optimizing Your Performance

Fast Fact: Average iOS eCPM — $5, average Android eCPM — $2 What in the world could be more tiresome for an advertiser than a constant tracking of you KPIs in fright of them going downhill? In fact, mobile developers that work with an ad network are always in struggle, as they need to optimize their campaigns manually to keep performance on the same level. We don't have to tell you how time-consuming it is.

Aiming for less? We have a solution:

What if you could automate your performance optimization? What if you had a tool that takes care of your campaign while you're sleeping, on vacation, or simply don't want to babysit each campaign in every ad network dashboard?

Luckily for you, a mobile white label DSP knows how to do that as well. It has two in-built automated performance optimization features: bidding autopilot and bidding multiplier.

Before enabling bidding autopilot, you specify so-called bidding rules. For example, you can set the following rules for your mobile traffic acquisition campaign:

If 10,000 impressions and 100 conversions, then increase ad spend by $1,000.

If your creative is performing good enough and you get many conversions from the chosen source, it makes sense to increase the ad spend for this campaign.

Conversely, you can eliminate underperforming sources and creatives from your list:

If 10,000 impressions and 1 conversion, then blacklist a creative.

You can also adjust your eCPM and eCPC using bidding rules based on the number of clicks, impressions, and conversions. After you complete setup, the platform will automatically perform the required actions even while you're gone.

Bidding multiplier is another feature that saves your money and guarantees frequent placements on premium mobile traffic sources. Detecting the best-performing app or a website, it applies a bid multiplier to make sure you'll win this impression. Look at how exactly it works:

Bidding rules in Epom White Label DSP

The algorithm works automatically. All you need to do is to create the list of specific sources and set the value of a multiplier. You can create multiple lists with different multipliers and tie them all to a single advertising campaign.

A White Label DSP is a Key to Cost-Effective Mobile User Acquisition

Recapping all we said above, almost all significant mobile user acquisition challenges of prominent advertisers can be solved by building an own DSP with a white label technology. Mobile DSPs possess essential features ad networks will be lacking forever:

  • Unified media buying activities
  • % of data fraud tends to 0
  • Exhaustive live analytics
  • 100% data transparency
  • Automated campaign optimization

Thrilled about these undeniable benefits of a white label mobile DSP? Schedule a free discovery call to see a demo of Epom solution!

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