We’re assuming that advertising on mobile is one of your New Year’s resolutions, right? If so, congratulations! The next step is to educate yourself on the nooks and crannies of the ad tech industry and mobile advertising. There are hundreds of articles and sites that will give you the information you need. However, the most important information is right here in front of you. This is more than just a source for definitions. This is a no-BS, objective rundown of all the basics you need to know to begin your mobile journey.
What is programmatic advertising and real-time bidding?
Programmatic advertising is the buying and selling of advertising through computers. Programmatic isn’t unique to mobile. Programmatic is also used for buying and selling display and other types of inventory (even TV). Back in the day (only a couple of years ago), advertising inventory was bought and sold manually with RFPs and salespeople. Now advertising inventory is bought and sold through online advertising platforms.
Programmatic advertising on mobile typically happens through real-time bidding (RTB). Real-time bidding is a live auction in which demand-side advertising platforms bid on individual impressions on your behalf from an advertising exchange. If the price you set is high enough, your ad is then shown to a mobile user. It’s just like a real auction, but awesome-er.
Why is programmatic advertising and real-time bidding a big deal?
Together, these two technologies provide a super fast, efficient, and less expensive way of buying and selling mobile advertising inventory. This saves you a ton of money and time, in addition to giving you more granularity into your mobile advertising campaigns. You set the targeting and price, and someone bids on your behalf. Once your campaigns are running, you can dissect what’s working and what’s not right from an online dashboard. Keep in mind, this all happens within a tenth of a second!
What’s the difference between a DSP, SSP, ad exchange, and ad network?
Demand-Side Platform (DSP) – DSPs are essentially trading desks for advertising (kind of like E*Trade). DSPs provide advertisers with a dashboard to buy mobile advertising inventory, target their customers, and analyze campaign statistics. DSPs bid on mobile advertising inventory on behalf of advertisers.
Supply-Side Platform (SSP) – SSPs are DSPs for publishers (SO. MANY. LETTERS.). SSPs provide publishers with a platform to sell their mobile inventory.
Advertising Exchange – An advertising exchange is a digital marketplace that acts a mediator between advertisers and publishers. They relay the inventory from publishers to advertisers. Think of it as a stock exchange.
Advertising Network – An advertising network is pretty similar to an SSP, with slight differences. Ad networks have traditionally sold their inventory directly to advertisers instead of using programmatic technology. Ad networks have also been known for having premium, high-quality inventory.
What’s premium inventory? How can I get it?
“Premium” in mobile advertising is codeword for “quality” or “VIP”. Premium inventory is the most desirable inventory for advertisers, as these apps and sites are used by a large number of people worldwide. These are often popular apps and sites that have tight restrictions on what types of ads they allow.
Quality control of mobile ads has undergone a major audit, and all companies involved are taking action against ads that disrupt the user experience. Getting premium inventory doesn’t have to be a mystery. Premium inventory is not just for brands anymore. Rather, it’s for quality advertisers who can create high-quality ads that act as more of a benefit than a nuisance. Since there’s an industry-wide crackdown on spammy ads, the only way to “unlock” premium inventory is to promote quality ads.
How do I know which type of company is right for me?
It depends on your needs as an advertiser. There are a ton of DSPs in the ad tech industry that provide similar features and capabilities and target the same type of advertiser. However, there’s a proven way to separate the wolves from the sheep.
The first thing to consider is whether or not a company addresses your needs. Most mobile advertising companies have platforms tailored for large brands with massive marketing budgets. If you’re a small advertiser, your best bet is to go self-serve. Of course, with self-serve mobile advertising platforms, the success of your campaigns is solely in your hands, not an account manager who will manage them for you.
Next, consider whether a platform’s features and services will make your mobile advertising experience faster, efficient, and more informative. Features and services to look for include real-time statistics, a simple interface, tools for easy optimization, (e.g. blacklisting), research information to help you plan your campaigns, a built-in ad creation tool, and a customer service department that can respond in a timely fashion.
What ad formats formats exist?
There are a ton of ad formats available to advertisers, the most popular being banner ads (320×50 performs best). There are also rich-media ads, push notification ads (which people really hate), video ads, text ads, and native ads. What you should choose depends on what your chosen mobile advertising platform allows and what you can profitably scale.
What is native advertising and why does it matter?
Native advertising is a form of advertising that matches the form of the app or site on which it appears. In other words, consumers won’t be able to distinguish whether a native ad is, in fact, an ad or a natural piece of content (hypothetically). This is a less annoying way of advertising.
Native ads are the next big thing in mobile advertising. As banners are phased out and consumers become more annoyed with traditional ad formats, advertisers will look to provide a truly contextual mobile advertising experience that increases their chances of capturing an engaged consumer. As you can imagine, the assumption is that native ads will perform better (and they will).
What should I measure?
There are several key performance indicators to consider when running your mobile advertising campaigns.
Win Rate (Impressions/Bids) – Your win rate tells you how much you’re winning (or losing) when it comes to bidding on mobile inventory. Most advertising platforms don’t provide this metric upfront.
Click-through Rate (Clicks/Impressions) – The classic CTR tells you how many times your ad was clicked out of all the times it was shown. This metric tells you how effective your ad is at reaching your target audience. The better and more targeted your ad, the higher your CTR.
Conversion Rate (Conversions/Clicks) – This is the most important metric for you to track. The conversion rate tells you how many times your goal was completed out of the amount of times your ad was clicked. Your conversion rate is a measurement of the overall success of your mobile advertising campaign.
After Click/Offline – There are also other metrics that advertisers can use to track consumers after the click and offline, such as call-through rate and in-store visits.
What is ad fraud and how can I avoid it?
There are different types of ad fraud. The most popular form of ad fraud in mobile advertising is click fraud. A click is considered fraudulent when an automated script, program, or person clicks on an ad without having genuine interest in the ad. These fraudulent or bot clicks cost advertisers hundreds of thousands of dollars.
There is nothing you can personally do to get rid of click fraud (besides not advertising). Bad people will be bad people. Your chosen advertising platform should work with you to detect fraudulent clicks, and the ad tech industry as a whole has to take action and create safeguards from this type of ad fraud.
What ways can I purchase mobile inventory?
There are several ways to purchase mobile advertising inventory. Here are the four major options:
Cost Per Thousand Impressions (CPM) – CPM is (or should be) available on all advertising platforms. You pay a price to have your ad shown 1000 times
Cost Per Click (CPC) – You pay every time someone clicks on your ad.
Cost Per Acquisition (CPA) – This is the amount you’re willing to pay for a conversion.
Cost Per Install (CPI) – CPI is popular among app developers who only want to pay when someone downloads their app.
Side Note About Ad Impressions: Just because your ad was shown doesn’t mean it was actually seen. There is a lot of talk about ad viewability. Read about it here.
There you have it. The ten basics you need to know about mobile advertising. Of course, there’s a lot more to learn about this complicated industry. Godspeed.
This article originally appeared on Decisive Blog.