App Monetization, Tips and Advice, Video

Top 7 Incentives for Video Ads in Mobile Games

Top 7 incentives using video ads in your app!

Rewarded videos have been proving to be a highly effective format that balances retention with monetization and typically turn eCPMs of over $20 in the US. However, unlike other ad formats, they require the game designer to build incentives that can be handed to the users when he watches videos. Check out our previous post that talks about mastering the Opt-In ratio to boost rewarded video ad revenue. The general rules of thumb on where to implement rewarded videos are:

  • Designing the incentives from the beginning is easier than adding them after
  • The more evolved the meta game is, the more opportunities for videos there are

Here you can find the most popular incentives to entice users to watch videos:

1. Lives or “save me” option

This is a familiar incentive that allows the player to cheat death. It it widely used in Match-3 games where the meta game typically dictates that a player may only fail 5 times before he runs out of lives at which point he typically has to wait for his lives to replenish. Another version of this incentives appears in action/arcade games where a violent death of the character typically ends the player’s session and an option to keep the session going makes a strong incentive for the user to watch videos.

2. Time related incentives

Warping the game time can be a compelling incentive for the player. In some games, the player is only given a limited time to complete a mission or a screen and is offered to watch a video to gain more time. In other situations, the player wishes to avoid a long wait and is willing to trade that wait for watching a video. A perfect example is upgrading a piece of equipment which takes 2 hours, but if you watch a video ad, it upgrades immediately.

3. In game currency

This one is simple and quite obvious. A bag of gold in exchange for watching a video is one of the oldest offers out there. It’s not the most effective incentive but it’s widely applicable and typically doesn’t require any special hooks to be put in the game for it.

FREE REPORT – VIDEO ADS RETENTION IMPACT

4. Earnings doubler

The coin doubler is known as a paid item that players can buy. However, a limited time doubler may be offered as an incentive to players who are willing to spend 30 seconds watching a video ad. This type of incentive is popular in idle clicker games and runner games among other genres. There are 2 variations of this incentive:

  • Pre-session – allowing the user to start a session knowing his earnings will be doubled
  • Post-session – popping the question to the user in the session summary screen

5. Re-dealing of a randomly assigned element

In many cases a player get dealt a hand of cards, in other games he opens a pack of collectables and sometimes it’s quests, missions or even songs that the game randomly selects for the player. If a player doesn’t like his options, he can change them in exchange for watching a video.

6. Renting items

Some items in the game can be priced very high and not many users can afford them. Giving them away for a video watch can reduced the perceived value of such items. The compromise is to rent such items for a limited period of time. If an item costs $50 and you expect the users to use it for 30 days renting it for 15 minutes for a video view is maintaining the balance and unlikely to hurt your conversion to payers.

7. The daily spin

Many games offer a daily spin or surprise box as part of their meta game. It’s a great way to make players feel welcomed and keep them in the game. This daily spin often ends with a near miss experience and users are likely to watch a video ad if one is offered in return for an extra spin.

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Analytics, Announcement, Industry News, Tips and Advice

GDPR 101 for Mobile Apps or How to Avoid a €20M Fine

GDPR 101 - How to avoid the €20M fine for your mobile app

Some of our customers started asking us about GDPR, so we created a GDPR Compliance FAQ page to answer most questions. To those of you who haven’t heard about it, GDPR is the new European privacy regulation that will take affect on 25th of May 2018. The new set of rules is causing many companies to lose sleep also due to the recent Disney lawsuit and the lawsuit against Kiloo, maker of Subway Surfer. The first suit includes not just the company itself but also tech providers such as Kochava, Upsight and Unity.

This means that while the app companies are on the front, the technology companies behind them should also learn GDPR carefully. In the rest of the post, I’ll try to describe some of the key differences and explain what actions companies should consider. So lets jump into what’s new with the GDRP:

The price tag difference

One of the new aspects of GDPR is that it names a price for non-compliance – fines can reach up to €20M Or 4% of annual gross revenues – the greatest of the two. What this means for app companies is that they have a strong business case to invest money and effort in complying. For tech companies, it means that the level of liability will be pushed up. If tech companies were able to get a way with capping their liability at a $0.5M or $1M dollar, that will no longer be acceptable by the app companies.

US companies also on the hook

Another key difference is that GDPR makes it clear that as long as companies have users in EU, the rules apply to them regardless of their location. For US companies, this is a major difference as privacy rules in the US are less restrictive.

Everything is personal

One thing that the GDPR makes very clear is that all device identifiers including IDFA (Apple devices’ ID for advertising), GAID (Google’s advertising ID) and IP address are now considered personal data and any data stored with it in the same record should also be considered personal. This have been a gray area a few years ago but was getting less and less gray in recent years. With GDPR there is zero doubt about this. For app companies and, advertising companies and analytics companies this means that all data becomes personal and should be treated as such.

Encrypting and protecting and documenting data transactions

Another requirement that GDPR makes more clear is the need to encrypt and protect personal data as well as document any transaction in which encryption was not possible. This is not a new requirement but since all data is considered personal now it becomes a requirement for each company and each piece of data. Here is an example of one process that is likely to change for App companies and has already affected some of the tech providers. In the past, companies used Facebook’s highly effective lookalike modeling service by creating custom audiences based on divide identifiers. The practice of exporting a CSV file from you analytics or attribution platform, storing it in your personal computer and uploading it to Facebook is now considered a non-encrypted transaction that has to be documented. Not many app companies will want to cumbersome their process with the documentation requirement and so some of the attribution companies have responded with audience builder tools that make this transaction encrypted.

CASE STUDY ON ADVERTISERS CHURN & eCPM

Is your data coming to US for business or pleasure

Another area that app companies and tech companies serving them should be aware of is the transfer of information outside the EU and specifically to US. This has been a key topic for previous legislation but the requirements became stricter with GDPR. This topic is known as cross border transfer. In a nut shell, EU knows that US is more liberal when it comes to privacy and specifically in the Federal’s government ability to force companies hand in providing private data. One example of the FBI power over companies was last year when Apple confronted the FBI and refused to help them crack an iPhone. While Apple stood up to the FBI, very few companies will risk disobeying a court order.

To adapt to the new regulations, companies can no longer rely on gaining the user consent for transferring their data. This practice is required but not sufficient anymore. Instead companies should do one of the following:

  • Keep data about EU users in Europe and comply all tech providers to do so
  • Make sure all providers are part of the Privacy Shield initiative
  • Execute model clauses to document each data export from EU to US

Keeping data in EU

This may sound easier than it is. If you are an app company, you are probably using at least a dozen services to help you monetize users, analyze them and improve your app. Most likely, you also have homegrown analytics tech that reads and writes data to a database stored by a cloud provider. Keeping the data in EU means you need to go to your cloud provider and each one of the other tech provider and make sure they also keep the data in EU. In turn, the tech providers will have to go to their tech providers and cloud providers and do the same. While the major cloud providers: AWS, Google and Azure have data centers in Europe it’s unlikely to ensure 100% of the data staying in EU given the number of providers involved especially when the app is serving ads.

Privacy Shield

This is essentially a certification that companies can get if they do store their data in the US. Being listed in the Privacy Shield list of certified companies is an alternative requirement to keeping data in EU. It means that tech providers who don’t keep EU user data in EU can get a Privacy Shield certification and help the app companies comply with GDPR. In the list below, you can find popular SDK providers that already obtained Privacy Shield certifications and the ones who didn’t. The extensive list can be found here – https://www.privacyshield.gov/list . Note that:

  • Providers that store data in EU don’t need the Privacy Shield (e.g. Adjust)
  • Providers can give an EU model clause document to app companies as an alternative to Privacy Shield and still comply with GDPR.

SOOMLA is already in compliance with the regulations and has started a process to obtain a Privacy Shield certification. Ask us about the current status by emailing – privacy@soomla.com.

EU Model Clause

As mentioned before, providers who don’t keep their data in EU and don’t have a privacy shield certification can still help app companies comply with GDPR by providing an EU model clause document explaining exactly how and what personal data flows from EU to US.

The right to be forgotten

Another key requirement by GDPR is that every user has the right to be forgotten. This means that a user can request an app publisher to delete all his data including data about him that is stored by 3rd party providers.

What you should ask from your providers

While there are a few changes app developers might have to implement in how they handle their users’ data most of the work will probably be with ensuring their providers’ compliance and more specifically their advertising related ones. The decision to treat IDFA, GAID and IP addresses as personal data puts all the advertising industry in the spotlight as most of it was operating under the assumption that IDFA will not be considered personal data.

Here is quick compliance checklist for your providers.

  • Do you protect and  encrypt any record that contains IDFA or IP address?
  • Can lists of IDFAs or IP addresses be exported? Do you send such lists over email?
  • Do you keep the data in EU or US? If in US – are certified under privacy shield? Can you provide model clause explaining all data transactions?
  • Forgetting users – Make sure you know all instances of the user record (log, backup, main DB, …) and what’s the mechanism to delete.

Providers Not Certified with Privacy Shield [updated Nov-2017]

  • Appodeal
  • Chartboost
  • Ironsource
  • Fyber
  • Adjust (But already has a stricter certification)
  • Heyzap
  • Lifestreet
  • Media Brix
  • AOL / Millenial
  • Tapjoy
  • Vungle
  • Upsight/Fuse
  • Unity / Unity Analytics / Unity ads

Providers Certified with Privacy Shield

  • Google – including Cloud, Admob, Analytics and Firebase services
  • Amazon – including AWS and Amazon Ads
  • Microsoft – including Azure
  • Applovin
  • Adcolony
  • Appsflyer
  • AppAnnie
  • Mixpanel
  • Facebook
  • Kochava
  • Amplitude
  • TUNE
  • Mopub

 

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Analytics, App Monetization, Tips and Advice

3 reasons to track 1st Impression eCPM and not Average eCPM

3 reasons to track 1st Impression eCPM and not average eCPM

App Publishers who monetize with ads often face the need to compare between ad-networks. Which one offers stronger monetization? Is the network declining in strength? Who should i put first in the waterfall? The common practice today is to look at the average eCPM but actually looking at the 1st impression eCPM is a much better approach. Here are 3 reasons for that.

Networks put their best campaign first

Each ad network has internal optimizations mechanisms in place. Some have algorithmic approach that try to predict the eCPM of each potential ad given who is the user and all the data they have about him. Others have more simplistic priority lists. Either way, when the network sees the user for the 1st time in a given day, it will try to put the best ad for that user. In later impressions, they have to circulate in other ads, their 2nd best, 3rd best and so on.

Average eCPM is a self fullfilling prophesy

Average eCPM on the other hand is influenced by many parameters other then the network’s stregth. In situations where the average eCPM is used to determine the priority between the networks it acts as a self fullfilling prophesy. To understand this, let’s look at the two ends of the priority list:
The Network with First Priority – This network gets more 1st impressions than any other network as long as it has fill for them. This drives the average up. At the same time, the network also wants to stay at the top and knowing that the publisher is looking at the average eCPM it is likely to set a price floor that will eliminate the low eCPM campaigns. This will also drive the average eCPM up.
The Network with the Low Priority – This network is getting less 1st impressions so their average will be lower. Even if the network landed a major campaign it will not get a lot of exposure and will not be able to drive the eCPM up. At the same time, the low priority network can’t shut down the low eCPM campaigns as that will completely choke the delivery for their advertisers and will cause a new bag of issues for the network.

FREE REPORT – VIDEO ADS RETENTION IMPACT

Changes in 1st impression eCPMs are clear triggers for action

Tracking different parameters is a good practice but tracking becomes much more powerful when it’s connected to actions. When you track the average eCPM and you see a drop in that paremeter for one of the ad-networks there could be a few potential explanations. For example, if that network is getting a high percentage of later impressions it would bring down the average. The 1st impression eCPM is less influenced by how you are using the demand source and is a better indicator of the quality of the demand. A drop in the 1st impression eCPM can be caused by the ad-network losing an important advertiser or by them changing the rev-share on their end. Either way, it’s a good reason to look for new partners to take the lead.

Tracking 1st impression eCPM – Easier than ever

The reason why more company focus on average eCPM rather than 1st impression eCPM is that this is the information the ad-networks are making available on their dashboards. Publishers that use SOOMLA, however, have easy access to reports about the 1st impression eCPM over time and the 1st impression eCPM of every single campaign by each ad-network in addition to the average eCPM.

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In-App Events That Give You Insights for Your Game’s Performance

Easy In-App Events That Can Give You Insight on Your App's Performance

No matter what you are looking to achieve, in-app events are a great way to go about getting performance indicators on some of the central issues faced by your app’s growth. While it might sound great to track every swipe, click, open or close event within your app, it can become a bit overwhelming to make use of all the data.

There is already an established list of benchmarks that should be closely monitored to give you some insights about your app’s performance, however the focus here is to dive into specific in-app events and how they should be approached.

Here is the short list (we could have made it much larger):

Registrations and the dreaded drop-off

Registration drop-offs are the bane of every app. We work so hard to get the quality traffic and the installation, but when it comes to registering – poof they are gone. The golden rule is reduce the amount of steps required for the user to complete the registration. With each additional step, the drop off chance is higher.

Solution – Keep a close eye on your registration drop offs. Identify key steps that are causing it and work to reduce. A/B testing is key here.

Tutorials

Some apps have them, some don’t, but it all depends on how much of an onboarding experience you want to provide the new user. Whether or not they are effective or not, I’ll let you be the judge, however if you do have them, a user’s completion of the tutorial can give you some insight as to how engaged your users are.

Solution – Overall on-boarding completion is a good metric to keep an eye on, however if the number is significantly low, it would be worthwhile to set up multiple in-app events for various stages to check out where the drop-offs are occurring.

User Progression

How quickly your user’s progress through your beginning game content is a great identifier on how your app is performing, but also can give you great insights on which users to segment and target specifically. Conversely, those users who move through the content slow should also be identified.

Solution – Logging several events throughout (beginning, middle, end), should be examined to monitor drop-offs and provide some insights on how engaged your users are.

Video Ads Completion

There are a multitude of parameters to look at and analyze when considering how effective your video ads are. Several studies have been put out, but the macro trends show that there has been a big shift towards video ads and its respective portion of ad revenue.

Where you place your ads within your app and how frequently can influence your revenue, uninstall rate, player experience and many other key KPIs.

Solution – Monitor and A/B test the placement and frequency of your video ads. They can have a big effect, but also have the potential to damage your app’s overall performance. Also be sure to check out our post on optimizing your opt-in rate for video ads which can help boost your ad revenue significantly.

FREE REPORT – VIDEO ADS RETENTION IMPACT

In-App Purchases

If your app has in-app purchases, an obvious tell-tale how your app is performing is how many of your users are making purchases. It is a great indicator of how engaging your app is, be it either via content or level of addiciton. A user’s purchasing behaviour can then be leveraged for future purchases. Knowing what your users have purchased and how much they have spent in the past are key for segmenting promotions and sales for specific users.

Solution – If the frequency of in-app purchases are very low, try to lower the costs / increase the offer to entice users. The ultimate goal is finding that sweet spot between making the in-app purchases valuable but not too much so that they make it too easy for the user.

Conclusion

Very likely each app has it’s own category specific in-app event that is closely monitored, however we tried to focus on the basics that touch on many different types of apps. We hope that this list helps you gain some insights on how your app is performing.

If you can think of any other critical in-app events that should be added to this list, let us know!

 
 

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Analytics, App Monetization, Guest Post, Tips and Advice

Comparing the Best Ways to Increase Ad LTV

Call App's Jonathan Raveh - Best Ways to Increase Ad LTV

Jonathan Raveh is a mobile monetization expert and the Director of Monetization at CallApp, a world leader in Caller ID & Call Recorder services.

One of the interesting abnormalities in the world of app monetization is the relatively low number of people assigned to it. UA acquisition departments usually take up much more personnel, while the main focal point for generating revenues in an app development company, is usually understaffed or assigned to the product team.

While this may not be the best policy, this is definitely the reality. Monetization is a shared responsibility across many departments in the company, including UA, Product & Marketing. This leaves any dedicated monetization employees in a serious dilemma – with low resources, where should they invest their time and effort the most? With ad monetization getting bigger even for IAP focused apps, this is a true challenge.

CallApp, a caller ID & call recorder app is one of those apps. With over 35M installs worldwide, our app is totally free to use, and while there are some IAP offers in place, most revenue is ad-related. Joining a very small team and being solely responsible for the app monetization efforts, I faced this challenge from the very first day – FOCUS. Granted, there is no limit to what you can focus on when you’re in charge of monetization. However, there is a definite time limit to (1) hours in the day and (2) Being able to concentrate without making too many mistakes analyzing data. The other major constraints are limited development resources and UX.

These limitations ultimately shaped up our 4 major, strategic responsibilities for mobile ad monetization that rise over and influence the day-to-day actions and task. We’ve put them to that to the test, and came up with some findings that helped figure out exactly what task our time will be best spent on.

Ad Frequency & Location

Right off, this is that one is the very basic element. Forget ad partners, forget business – determining ad frequency has a huge effect on the entire app eco-system. In the short run, ad location, and more importantly ad frequency influence development, usage, data, UX, user satisfaction. In the long run – ratings, reviews, PR, ASO and much more. We found that these types of changes may amount to 50% change in revenue. In term of development time, this is not an easy task, but as these changes aren’t usually done on a daily or weekly basis, it’s definitely barrable.

Focus on GEO’s

Ad monetization wise, app developers tend to give attention to 1 of the following:

  • High eCPM yielding counties
  • High impression yielding countries
  • Countries that possess 1+2

In more cased than not, attention means full attention, and that means that countries that do not generate high impression volume or high eCPM are simply neglected. In most cases, neglected GEO amount to more than 25% of traffic. In order to optimize those loose ends, there is usually a need to work with more localized ad networks, expand and complicate your ad waterfall and sometimes work with additional ad formats. Not only does this burden your development team, it also creates tons of work for the person in charge of monetization. So, a tough decision. However, this clear subjective decision that varies from one app to another, usually influences over 20% of revenues, in average.

Adding More Ad Networks

The actual deciding factor on how many ad networks an app needs, depends heavily on the level of monetization you want to achieve. The actual number of monetization networks an app needs relies on 4 parameters, known as the FORM model which we developed in CallApp: Formats, OS, Regions, Maximization. The entire model has been widely explained (here), yet it embodies another critical decision in the maximization element: how much work are you will to make to get those extra 10 percent of revenue. These 10 remaining percent of revenue require some work from the IT side (adding more ad networks), and a lot of Monetization hard-labor analytics.

FREE AD NETWORK COMPARISON SPREADSHEET

Setting Floor Price

If you monetize your app using Facebook and Google (and a few others), this is a must. There are automated mechanisms in place, by both ad giants, to make sure you generate a minimal amount of revenue, but true optimization cannot be reached without designated price floors.

When it comes to price floors, there’s a major difference between Google & Facebook: While Google’s price floor (via Admob’s & AdX) tend to merely set a floor from which your eCPM cannot go under, FAN’s floor prices are actually ‘target eCPM’, a level that sets the goal for its performance to reach, regardless of any other elements – CTR, impression and mainly fill rate. However different, both price floor mechanisms are a pretty powerful tool. They require no effort from the development team, yet a lot of attention from the monetization team. Price floors are affected by anything from ad frequency, GEO’s and seasonality, so they need to be monitored on a daily basis. A hell of a lot of work, with a 30% revenue bounce potential.

After experiencing the effects of these 4 pillars of strategic monetization decisions on all sides – revenue, product, development time, monetization time, etc – we were able to visualize these strategies, to better understand the role of the monetization team.

Effects Compared To Development Team Work:

Development Resources for AD LTV

Effect Compared to Monetization Team Work:

Day-To-Day Resources

The last 7 months at CallApp taught me, first and foremost, that in ad monetization, focus & prioritization are strategic decisions. Time equals money, but it’s a lot more than your money – it’s the money you could have been generating doing something else to improve results. Not all apps will follow the same path in this time/effect/results equation, many simply just into the pool of the day-to-day duties without taking a single moment to breath and think about what they want to gain. The CallApp experience has definitely taught me that everyone should give it some serious thought. That will ultimately lead to better result in the long run.

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App Monetization, Tips and Advice

Hiring a Monetization Manager – ROI Formula and Explanation

Hiring a ROI Monetization Manage, a full ROI formula and explanation

Many companies ask themselves these days if they should be hiring a Monetization Manager now or wait until it’s volume is larger. In this post we will try to provide a simple framework for thinking about this question.

Ads first games vs. IAP first games

There are two types of companies to consider for this question. Before you continue, you should ask yourself which type of company are you. The framework for evaluating the merits of hiring a monetization manager differs a bit between the two types of companies. Here is the profile for each one:

Ad first games – These are typically smaller companies. If you are an ad supported company and still debating the monetization manager question it’s unlikely that you have more than 15 employees. These companies tend to have a mix of at least 3 ad formats from this list: banners, native, interstitials, video and rewarded video.

IAP first games – These are typically more established companies who already do well with IAP and treat ads as a secondary channel. The ad formats in use here are mostly rewarded videos and sometimes offer walls.

The basic formula

There are 2 conditions to be met before you hire a monetization manager:

  • The ROI condition
  • The focus condition

The ROI condition

[monthly ad revenue] x [improvement opportunity ratio] x [risk factor] > [monetization manager full cost]

Where:

  • Monthly ad revenue – how much your app is making every month from advertising
  • Improvement opportunity ratio – Estimation of how much you can improve
  • Risk factor – the chance of that improvement actually happening
  • Monetization manager full cost – Salary + social benefits + taxes + direct overhead increase + cost of tech tools + cost of projects he will drive

The focus condition

The focus condition is looking at the same formula but instead of justifying the direct cost, you are estimating the opporunity cost. The focus condition is more relevant if you are projecting that the monetization manager will be driving many requirements to R&D and BI departments. We will see how to evaluate how much effort the monetization manager will require in the paragraphs below.
The way to think of opportunity cost is usually top down. Let’s say that the goal of the company is to double in revenue within 12 months. This means that each quarter you are looking to get 20% growth. Most companies can’t contain more than 2 focuses each quarter and some say 1 is enough. This means that if the monetization manager and all the tasks associated with him will not generate 10% increase it’s not meeting the focus condition. The formula will look as follows:

[improvement opportunity ratio] x [risk factor] > [Required quarterly improvement] / [Quarterly initiatives count allowed]

Estimating the improvement ratio

For IAP first games

  • Improving opt-in ratio for rewarded videos – high product and R&D effort – can double or triple ad revenue when combined with A/B testing.
  • Adding more demand partners – medium product and R&D effort – the improvement in ad revenue can be up to 50% depending on current status (see full explanation below)
  • Applying CPM price floors and cutting fixed CPM deals – no R&D effort – up to 15% improvement
  • Blocking low eCPM advertisers and optimizing volume for high eCPM ones – no R&D effort – up to 15% improvement
  • Setting different ad strategies for different segments – low R&D effort – up to 30% improvement
  • Acquiring users who respond better to ads – no R&D effort – up to 50% improvement

For Ads first games

  • Optimizing the frequency and mix of ad-formats – medium R&D effort – can improve ad revenue up to 50%
  • Adding more demand partners – medium R&D effort unless done as S2S – the improvement in ad revenue can be up to 50% depending on current status (see full explanation below)
  • Applying CPM price floors and cutting fixed CPM deals – no R&D effort – up to 25% improvement
  • Blocking low eCPM advertisers and optimizing volume for high eCPM ones – no R&D effort – up to 15% improvement
  • Setting different ad strategies for different segments – mid R&D effort – up to 30% improvement
  • Acquiring users who respond better to ads – no R&D effort – up to 50% improvement
FREE REPORT – VIDEO ADS RETENTION IMPACT

How much your ad revenue can improve by adding demand partners

The improvement ratio per ad-format is driven by how strong your demand and fill rates are currently. We included a basic formula that we found helpful but you should do a better job assessing this by looking at specific countries and diversified demand. We also recommend Jonathan Raveh’s post on this subject. Here is a simple formula to start with:

(2x[number of ad-networks serving banners]+1)x[banners revenue ratio from total]/2x[number of ad-networks serving banners]-1

Estimating the cost of the monetization manager

$8K/month or $96K per year is a nice salary for a monetization manager in US. The taxes and benefits in US can come to 25% to 40% on top of the salary. Office space and immediate overhead per employee can be around $500 based on WeWork rates. In addition, we should add the average license cost of SOOMLA ($3,000) since having a monetization manager and not giving him the right tools to optimize would be moot. The total comes to $13,500 – $15,000.

Estimating the risk

The risk ratio is slightly harder to estimate. You should think of all the things that can go wrong and try to assign probabilities. Here are some items to consider:

  • Bad hiring can set you back
  • If you can’t afford a SOOMLA license your risk will be higher
    • The monetization manager will not be able to a/b test the ad revenue so optimizations might have a negative impact
    • His ability to set the right price floors will be limited
    • He will not be able to analyze and optimize on a campaign level
    • Segmentation will not be possible for him
    • The users that are being acquired by the UA team will not be a good fit for ads
  • IAP first apps monetize mostly with rewarded video where negotiating eCPM price floors with ad-networks is only possible for high volume apps.

Example – finding the ad revenue threshold for hiring

Let’s look at one example of using the formula. We can estimate that the total opportunity to improve is 60%, the risk factor is 50% and the total cost of the monetization manager will be $15,000.

[monthly ad revenue] x 60% x 50% > $15,000

To satisfy this condition we need an ad revenue of at least $50K / month or $600K annually. The numbers we choose are reasonable so if you have this level of ad revenue and you are not hiring a monetization manager you are probably leaving money on the table. Of course, if you have $1M/month from IAP and only $50K in ad revenue, you might have bigger fish to fry first. This is where the focus condition comes in to play. Make sure you evaluate both before you make the decision.

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App Monetization, Tips and Advice

7 Advertising Sins That Will Kill Your Mobile App Retention

7 ad experiences that will kill your retention: freeze, decieve, frustrate, delay, bore, annoy, trick

When integrating ads, one of the biggest concerns is that users might churn away. There is an obvious trade off between the need to give the users a great experience and the need to turn revenue. Not all ads are created equally when it comes to their impact on user retention and it’s important to measure the impact of different ad types and monitor what ad experiences your users are getting from your ad partners. Below is a list of ad experiences to watch for:

FREE REPORT – VIDEO ADS RETENTION IMPACT

1. Crashes and freezes can impact mobile app retention

Ads are served by the ad networks who tend to require an SDK integration. Each SDK increases the complexity of the app and might conflict with other SDKs, in turn cause your app to crashes for your users. This happens especially in edge conditions such as old Android versions or uncommon devices. While crashes are typically reported through your crash analytics provider, there is another type of error that is trickier to track. In some cases, the SDK of the ad network will try to show an ad to the user but will end up freezing the device. This type of error is typically not detected and is harder to monitor but it could have the same negative impact. Both of these errors might cause users to churn away and reduce the overall app usage experience.

2. Close buttons that are hard to find frustrate users

In some situations a full size ad such as an interstitial, video or playable will load and the users will want to close it right away and continue using the app. The lack of an obvious way to skip the ad experience is a big turn off for users who are likely to stop using an app that consistently makes it hard for them to skip the ad experience. There are a few types of ads that have this negative experience. In some cases the X button will have a color that doesn’t pop up from the background, in other cases it will show up only after a few seconds without a clear indication of how long it will take and in other cases it might show up in a different way every time. Sometimes it’s all 3 together causing a very unpleasant experience for the user.

3. Lack of ad diversity will bore your users

It’s one thing to show a user 10 ads per day but it’s another thing to show him the same ad 10 times every day. In addition to being ineffective, repeating the same ad many times is a negative user experience. You may think that advertisers have enough incentive to make sure this doesn’t happen but in today’s mobile advertising eco system the lack of data transparency may result in the same advertiser showing their ads in your app through different channels and without them knowing about each other. In this situation, the frequency capping is not getting enforced.

4. Poorly targeted ads may get your users annoyed

Ads today can be highly targeted and users have come to expect targeted ad content. Poor targeting can range from an ad to a game you already installed and go all the way to inappropriate ad content being targeted to kids. The publishers typically don’t control ad targeting and usually leave it to the ad providers however some ad providers are better than others. While companies like Facebook are known for their hyper targeting, some ad networks have little targeting data to work with and placing the focus not on targeted ads, but rather on their revenue. If you are serious about keeping your retention high, you should monitor ad content and targeting closely.

5. Your users don’t want to wait for a slow loading ad

No one likes to wait but while waiting for something you desire can be tolerable, waiting for an ad to load is likely to be crime in your users’ book. Monitoring the loading time of every single ad can be hard to do on your own but the right monetization measurement platform can help you with it.

6. Deceiving ad creatives are hard to tell from your app buttons

Imagine a user that clicks on a “download” button only to realize it wasn’t a button but actually an ad that looked like the real button. Alternatively, picture someone trying to click on the “next” button but hitting an interstitial ad that popped up between the time his brain sent the command and the time the finger reached the button. These errors might be annoying for a savvy user but think how they impact the experience of a less savvy user who is now trying to figure out where the rabbit hole led him to and how he can get back.

7. Inconsistent ad skipping experience and long duration ads

Users are used to not being able to skip a rewarded video ad. These are opt-in ads that the user initiated and so it makes sense that he can’t skip them. However, other ad placements can have an opt-out experience or have no way to skip at all. Obviously, not having the option to skip is more annoying for users but what will really tick them off is when an ad placement will have a mix of:
  • Ads you can click skip right away
  • Ads that requires no action but just waiting
  • Ads that require a combination of waiting and than clicking to end
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In-House vs. Outsourced Tech Platforms in Mobile Games

in house vs. outsourced tech platforms

The gaming industry is notorious for having a strong NIH syndrome. In mobile games there is more openness for external solutions compared to previous gaming ecosystems. You can even find super successful companies like Supercell who outsource almost everything and are able to keep very lean while on the other hand companies like Wooga who even keep their ad-tech platforms in-house.

What not to outsource

The rule of thumb for outsourcing is that you don’t want to outsource the core functions of the company. This is obviously different from one company to another but in the gaming space almost all successful companies keep in-house is the game backend and BI. There is no lack of services offering BAAS (backend as a service), Game servers and off-the-shelf analytics solutions but there is a strong concenseus among the top tier companies that these should be kept in-house. The situation is different with two types of companies:

  • Companies like Ketchapp are focused on super casual games that don’t have a backend
  • Gaming startups sometimes make short term compromises and outsource components that they are later on hoping to internalize

Outsource your ad-tech platforms

On the other side of the spectrum – the ad-tech platforms are mostly outsourced. Even if you look at top tier companies it’s hard to find companies who built technologies around measurement, optimization and placement of ads. Here are some examples:

  • Attribution platform – most gaming companies outsources to Appsflyer, Kochava, Adjust or Tune
  • Ad Mediation – there are many solutions in the market and only a few companies built their own
  • Ad revenue traceback – companies were not able to build platforms to attribute ad revenue to the user level

Consider the TCO – total cost of ownership

One of the aspects that companies often miss when it comes to in-house development is the on-going maintenance costs. In a typical scenario the vendor will pitch his product and will present a price of $5,000/month. The VP of engineering will say – I can build this in a month. Obiously, the price of 1 month of engineer work should be considered but there is actually a lot more:

  • The alternative cost of the engineer should be considered – if you are delaying a feature that could be worth $50,000 than the price is actually more than just the engineer salary
  • The full overhead – The G&A expenses are correlated to the number of people in the company
  • Maintenance cost – bugs, responding to changes in the industry, upgrades, …
  • Hosting costs can ramp up quickly in ad-tech products
  • Dev-ops costs
Once you add up all of these, most likely that the price the vendor will be the lower one compared to the in-house option.

The hidden price in ad-network sponsored products

One area where companies fail to perform an accurate cost analysis is the area of ad-mediation. In this area there are companies who use in-house solution and others get a ‘free’ one from an ad-network. Here, the price of the ‘free’ product is actually a lot bigger than a paid product would have cost. One of the secrets of the ad-networks is that they are the ones deciding how much to pay the publisher, it’s very easy for them to withold 10% as a cost for the mediation. The publisher will never know. Now imagine a company with $10M in annual revenues. You have 2 options:
  • Get a free service (it actuall costs $1M/year)
  • Develop in-house
Most companies will choose the free service and only a few will build an in-house solution. However, in this case, the price of outsourcing is actually much higher compared to in-house.

Recap

The dicision to build or buy in the gaming space has two main aspects:

  • Know what is the core of your company and keep that in-house
  • Consider all costs including total cost of ownership and the hidden cost of ‘free’ gifts from ad-networks
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9 Ways to Cross Promote Your New App

cross promoting between your apps requires creativity - here are 9 ideas how to do cross promo

Most companies in the mobile app ecosystem today have more than one app. Once your company reached this stage, you should start considering cross promoting your new app in the existing apps. You should probably read The Complete Guide to Cross Promotion ROI in addition to checking out these 8 awesome ways to cross promote your apps.

Interstitials and App Trailers

This method is the most obvious way and has been in use for as long as people were making apps. You have one app, you launched a new one. Simply make an app trailer or at least a full page banner ad and add them in the existing app. Most mediation platforms supports this practice and it’s easy enough to do. Keep in mind however that you are taking away from your potential ad-revenue with this method.

Virtual goods / coins bonus

This method is for games only. Virtual goods and currencies are an integral part in most mobile games today. Once your new game is ready you can offer the virtual goods or coins of the new game as a bonus to the users of the existing game. This way the cross promotion message makes the users feel special and has more chances of attracting the users.

In-app notifications

While google and apple are not allowing using push messages for cross promotion, in-app notifications are still allowed. The in-app messages a simple yet effective tool that pops up a “system notification” style message to the user which immediatly grabs his attention.

More games button

This is a classic but still very effective, simply plant a button in your lobby/home screen and allow your users to check what other games you developed for them. Users normally assume that if they liked one of your games they are likely to like another.

Email messages that cross promote a new app

If your iOS app asks users to login or use a social network to connect, you should be able to leverage this method. Android apps can ask a permission to access the user email in the operating system or revert to social login. Once you have a long list of user emails you can leverage them to announce the coming of a new app. If you do this, make sure you include a way to unsubscribe in order to comply with Can Spam Act

Retargeting on Facebook and Google

This method costs some money but could still be effective if your new app monetizes well. Both Facebook and Google allows to target a list of customers and promoting a new app to them. You will need to either integrate an SDK in your existing app in advance for this or if you are a using an attribution provider you can probably ask them for a list of identifiers you can upload for this purpose.

crossy road cross promo method is to introduce avatars from other games

Adding the new game avatars in the existing game

Another method that can only used by games. It was first used by Hipster Whale in their game Crossy Road very effectively except it was used to promote other games. The users get acquinted with the new characters and are interested to explore the new game.

Bonus levels featuring the new app

This method is inspired by the playable ads that are getting a lot of momentum lately. The playable ads allow a user to play a few moves in the existing game before deciding to try the advertised game. Since your company is the developer of both games, you can actually build a better experience and incorporate a short bonus level in the existing game to get the users interested in the new one.

Name hints as a cross-promo tool

This is a generalization of sequales. Obviously, adding the number “2” to the title is an effective way to get users of an existing app interested in the new app. However, sequales requires the apps to be very similar and is a method only for games. Creating a name that hints to the other app creates a softer association that allows the new app to inherit the trust that the users generated towards the existing apps. Some examples:

  • Candy Crush Saga – King created at least 5 more games with a name ending in “Saga”
  • Clash Royale – Supercell hinted that their new game is related to their top game – Clash of Clans
  • Du Apps Studio – Android utility apps maker is dominating the top free charts while all their apps start with “DU”

 

If you would like to measure the tradeoff between cross promotions and ad revenue you should probably start attributing your advertising revenue. Check out SOOMLA Traceback – Ad LTV as a Service.

Learn More

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Who Should Calculate LTV and Who Shouldn’t

Who should calculate ltv header image with different kpi highlighted, cvr, ctr, cpm

Many companies in the mobile app ecosystem today try to figure out the LTV of a customer also known as CLTV or CLV. In fact, some of them probably shouldn’t. In the past companies simply focused on the value generated in a single session and count page views and conversions and for many situations this method is the right one to chose.

The choice between these 2 distinct methods often impact the choice of analytics platforms, attribution methods and many other things. If you are developing a new application, you should figure out which method suits your application.

Services should calcualte LTV

The industries that have traditionally focused on revenue per user calculations and user life time value were the service companies: phone carriers, utility companies providing electricity and cable companies. The models were later adopted by SAAS companies and these days, freemium games started the trend of “Games as a Service” and are using the same models as well. At the heart of these models there is an assumption that the customer will stay for a long time. This usually happens when the cutomer relies on the service for a basic need or when the service becomes part of the user daily routine and habits.

Companies who sell products should use atransactional measurement model

On the flip side, eCommerce sites are relaying more on transactional models where each purchase is measured separately even if performed by the same user. When games started, the Premium model was popular and games were considered products so the transactional measurement model was the standard. Users go to the app-store and buy an app for one or two dollars and that’s it. There is no retention measurement, no LTV analysis, ARPDAU, nothing like that. Transactional models are much simpler.

Habit creation is the deciding factor

The main question you should ask yourself when you are coming to chose between a transactional measurement philosophy or the LTV one is whether or not you are creating a usage habit. We are all used to turning the lights on as we walk into our house. We all flip on the TV as soon as we sit on the couch and many of us open the candy crush app when they wait for the subway. These are habits, they indicate the service became a part of the user life and there is a real chance he will stay for a long time.

Apps that monetize over time but don’t have a habbit

Let’s think about the example of Kayak. It’s an app that helps you compare travel deals: flights, hotles and car rentals. The customer might install the app and use it once but the next time he will use the app is only when he is booking another vacation. By that time, it’s very possible that he will have another phone. There is no habit being created that is attached to a daily or weekly routine. Every purchase is a stand alone transaction and should be thought of it that way. The value of acquiring a user through a CPI campaign is pretty low. And the LTV vs. CAC formula doesn’t really apply here. From this reason, companies like Kayak focus most of their marketing efforts on users that are booking travel in the near future. They might try to promote their app or entice user to bookmark their site but this should be considered more as a way to put an ad banner for free in front of the user’s eyes. There are other models that can be applied to assess the business merits of banner advertising.

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