10 Mistakes that Will Keep Your Ad Revenue Low

10 Mistakes that will keep your ad revenue low

Most of the companies I talk with are interested in increasing their ad revenues. For many, increasing ad revenue is critical as they need to be profitable on their UA activities. Despite that, I see many mistakes companies are making that prevent them from improving on this front. Here are the top 10.

No new SDK policy

Some companies seem to have decisions made from the engineering to the business and not the other way around. It’s true that there are many SDK companies knocking on the door at any given time and many of them promise more than they deliver. However, not adding any new SDKs is like saying – our strategy is to not change anything. In a dynamic space such as the mobile app market – this is a big mistake.

How to fix it:

Establish a process for vetting new vendors based on business potential, risk and costs and make sure you include alternative cost as part of that equation. This will help you re-gain the confidance of the engineering team that you are not just making random requests.

No ads for payers

In 2018 mobile app publishers will make more revenue from advertising than from IAP and publishers needs to start thinking about ads as a main source and not a secondary one. In 2016, SOOMLA revealed the existence of ad-whales. These users can contribute $30 or $50 or $100 in your app – more than some of your payers contribute.

How to fix it:

It’s time to design monetization patterns where ads and IAP complement each other. Think about a user that just purchase a bag of coins maybe he can get 25% extra coins for watching a video right after the purchase. There are many other options to experiment with just make sure you measure the impact accurately.

Not measuring your ad monetization

You can’t manage what you can’t measure” said Peter Drucker in a famous quote. In other words, the path to improvement goes through measurement and the domain of app monetization is not different. Ad revenue has been lacking proper measurement tools but the situation is quickly changing and monetization measurement is becoming a neccessity for any company who takes their ad revenue seriously.

How to fix it:

Implement a monetization measurement system that allows you to get granular data about how your users interact with ads in your app. As Jeff Gurian from Kongregate said: “Ads count so count your ads

Banning competitor ads

The debate whether or not to show competitor ads in your app has been going on for years. Some companies simply block any app that seems competitive while others enjoy the high eCPMs that competitors could be generating. A recent study by SOOMLA revealed that ads showing competitors might not be the ones that take your users away and each app needs to be evaluated on a case by case basis before deciding to blacklist.

How to fix it:

There are several SDK providers that can give you insight into who is advertising in your app. Implementing such an SDK in your app will enable a more data driven approach to the decision whether or not to advertise a specific app or block it.

One size fits all

When it comes to ads, not all the users are created equal. For example, some users may respond better to rewarded videos while others yield more revenue from banners and native ads. Serving the same ad experience to all the users is a great way to keep your revenues low.

How to fix it:

Track the yield of each user from each ad-type (for example – by using SOOMLA) and use the data to segment them into groups. You can then build more tailored ad experiences that will improve your ad arpdau.

Introducing rewarded videos late

While it’s clear that most ad formats have a negative impact on retention and payer conversion it’s also clear already that rewarded videos do not have such impact. Since 80% of your users are likely to not survive the first week, delaying ads for 7 days will surely have a negative impact on revenue.

How to fix it:

Introduce rewarded videos as early as possible and even include them in the tutorial. If you want to be a bit more cautious, you can do this only for users who are not likely to pay.

FREE REPORT – VIDEO ADS RETENTION IMPACT

Incentives that don’t add up

In many apps and more specifically in games, the users are rewarded for watching videos. The rewards can range from an extra life to coins or pretty much any upgrade that the game has to offer. Some games have invested time and effort to carefully design the reward opportunities into the game but in other cases the reward for watching videos is in-game currency in small amounts that don’t allow the player to buy anything of value. Offering incentives with little value will discourage users from watching ads.

How to fix it:

First, you should measure opt-in on a cohort basis to see if your users lose interest in the rewards over time. If you detect such an issue you can consult this post for ideas how to improve the incentives – Top 7 Incentives for Video Ads in Mobile Games

Not managing the ad networks

Ad networks are an important part of your monetization but their interests are not always aligned with yours. Typically, for each $1 you are making, the ad-networks are also making a $1. This means that there is a lot of opportunity for the publishers who can closely monitor and negotiate the prices up. Without doing this, your ad monetization not be optimal and might decline over time.

How to fix it:

First, you need a way to track ad revenue per impression sequence so you can manage the waterfall. Additionally, you may also want to get visibility into the campaigns the ad-networks are bringing you. If you don’t have those, you can still negotiate with the ad-networks but it will be harder. To successfully negotiate – remember that your leverage will  be the share in the impressions they are getting as well as their position in the waterfall. In return, you will want to get guarantees for eCPM and fill rates.

Focusing your UA only on payers

If you ask most marketing teams what users are they trying to get for the app they might answer “payers” or “high value players” but in both cases they mean payers actually. What this means is that the monetization manager is trying to monetize with ads users who were supposed to be payers. This strategy is far from ideal. If you are not giving the UA team a task to bring ad whales don’t be surprised that your users don’t do well with ads.

How to fix it:

Step 1 is to figure out who the ad whales are. Once you do that, you can start sending postbacks for ad whales so ad networks can send you more of these high value players. At the same time, you can have the marketing team profile the ad whales and learn more about them so they look for the right media to reach this audience. Finally, targeting lookalikes of the ad whales on FB ads manager has brought great results for some of our customers.

Not doing direct deals

Do you know how many ad-tech middle-mans are between you and the advertiser placing ads in your app? You don’t. It could be 1 or 2 or 5 or 10. One way to know for sure is having no middle-mans. Not doing direct deals means you are leaving money on the table but what’s more important is that you don’t even know how much revenue you are missing out on which means you have very little leverage when you negotiate with ad-networks.

How to fix it:

You should start by getting visibility into who is advertising in your app. This will give you a priority list of who you should be approaching. Getting to the right contact in these companies is not very hard but if you get stuck, shoot me an email to yaniv [at] soom [dot] la and I will try to connect you. Also knowing the eCPM you are getting from each advertiser through the ad-networks could prove useful.

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