App Install Ads Help Marketers Cut Through the Clutter - eMarketer

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App Install Ads Help Marketers Cut Through the Clutter

Flooded app marketplace means paid install campaigns are a must

July 17, 2015

Consumer demand for mobile apps is insatiable. Both the number of app users and their daily time spent are growing rapidly. But in some cases, apps have become victims of their own success. At a time when demand is soaring, it’s harder than ever for apps to get noticed, and increasingly difficult to keep users coming back once the apps have been downloaded, according to a new eMarketer report, “App Marketing 2015: Fighting for Downloads and Attention in a Crowded Market.”

US Mobile App Install Ad Spending, 2013-2015

Paid app discovery and install campaigns are increasingly important for many app marketers. Paid install campaigns might have been seen as a marketing luxury in the past, but in today’s hypercompetitive app environment, they’re increasingly a necessity. “If you only are driving through one channel—for example, organic—and you’re ignoring the paid channel, you’re missing an opportunity to get the type of bumps that you need to maintain longevity in the rankings of the app store,” said Raj Aggarwal, CEO of mobile analytics firm Localytics.

Indeed, more marketers than ever before are investing in app install ads. eMarketer expects US mobile app install ad spending to rise by 80.0% this year, reaching $3.00 billion. That said, install spending is still relatively small, making up 10.4 % of all mobile ad spending in 2015.

As spending grows, a range of app install ad formats are competing for marketers’ budgets and attention. Most parties familiar with app marketing agree that Facebook is the de facto leader for paid acquisition campaigns. “Facebook is far and away the most important app install channel,” Aggarwal said. But other players like Twitter and Google, among others, are aggressively building their own offerings as well. For example, Google recently announced Universal App Campaigns in May 2015, an app marketing tool that lets developers promote their apps across multiple Google-owned channels, including web search, YouTube, Google’s Display Network and AdMob, its mobile advertising company.

Types of Digital Ads that Have Prompted Smartphone App Downloads According to US Smartphone Users, Sep 2014 (% of respondents)

It may pay to spread app marketing dollars across different channels—smartphone users appear to be agnostic about which types of paid install ads influence their download choices. In a September 2014 study by Google regarding the types of digital ads that prompted app downloads, no clear winner emerged, with search ads, social ads and in-app banner ads all mentioned at nearly the same levels by US smartphone users.

For now, many marketers say the highly sophisticated targeting options and ability to leverage word-of-mouth make social media the best channel for paid install campaigns. But that is changing, as Facebook’s popularity is also driving up prices. “It’s relatively inexpensive to find a small handful of users on Facebook on a daily basis,” said Craig Palli, chief strategy officer at mobile app marketing platform Fiksu. “If you then want to find a large volume on Facebook on any daily basis, it gets real expensive fast.”

eMarketer corporate subscription clients can view the full report here.

Get more on this topic with the full eMarketer report, “App Marketing 2015: Fighting for Downloads and Attention in a Crowded Market.”

eMarketer releases over 200 analyst reports per year, which are only available to eMarketer corporate subscribers.


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