Mobile App Advertising: The Pros and Cons
Marketing | July 24, 2022
Approximately 70% of all web traffic comes from mobile devices. And every day, around the world, approximately 30 million apps are downloaded. Many of these mobile apps are monetised by Pay Per Click (PPC) ads, which means lots of potential to get the ads seen by a huge audience.
Mobile app advertising has grown to become one of the biggest platforms for marketers. In fact, it now accounts for more than half of the global ad spend, with an estimated $200 billion forecast to be spent on in-app advertising in 2021.
If you spend money on PPC, you might be wondering if this is a channel you should be looking at or if it can work for your business.
As you might expect, advertising on mobile apps has plenty of pros and cons. So, these are the main issues to bear in mind with in-app mobile ads.
Pro: Audience and exposure
From the figures above, it’s obvious that the traffic volume justifies placing your display ad within a mobile app.
In fact, in 2017, mobile users spent 87% of their time using digital media in apps, as opposed to just 13% browsing the web. Granted, a lot of these apps were popular social media platforms, established shopping apps, and music/video apps.
But… There are also a lot of free apps that offer ad space to pay for their development. This includes all sorts of channels, from video ads and ad views for app rewards – to native ads or even simple text ads.
Nearly 25% of all apps are games. The next biggest category is business apps (9.78%), followed by education apps (8.49%) and lifestyle (8.32%). (source)
Games do offer a broad appeal beyond just children and bored teenagers. And with business and lifestyle apps propping up the list, it’s plain to see that whatever your business, apps in mobile ads offer an intriguing option for marketers.
Con: Accidental clicks
If you’ve ever used an app with ads embedded in it, you’ll know that it can be a double-edged sword. On the one hand, it makes the app free, and with good placement, you might not even be aware of the presence of ads in mobile apps.
But on the other hand, mobile ads can be intrusive and annoying. Badly timed pop-ups, poorly placed ad frames, or controls that make it hard to avoid touching these ad placements are common complaints.
Put simply, some apps make it really easy to click ads accidentally. This can be a great benefit for the app developer as they’ll get a payout for each ad click.
For the advertiser, this increases the number of invalid clicks or non-genuine engagement. And, those invalid clicks don’t always get spotted or refunded by the ad platform either.
Pro: Growing marketing segment
The death of the app is very much over-exaggerated. The truth is people continue to download apps in droves, with 140 billion apps downloaded in 2016, climbing to over 204 billion in 2019. (source)
As mentioned above, many of these are games. But, there is also a huge market in lifestyle (think; fitness, diet, mindfulness) and utilities/business apps (think; money management, time tracking, communications, and note taking).
And with this huge market comes plenty of opportunities to target a diverse demographic.
Con: Trust issues
Although this volume of downloaded apps is huge, the truth is that many people will only download an app if they trust the company or if it has been recommended. This leaves a gigantic swathe of apps that don’t get anywhere near this amount of downloads.
And that isn’t the only problem with trust in mobile apps. A recent discovery found that apps on the iOS platform have been susceptible to click fraud and ad fraud, thanks to rogue code in an SDK (software development kit). It’s thought that this has affected thousands of apps that have been downloaded billions of times.
And in 2020, there have been several high-profile cases of click fraud (specifically click injection) affecting apps. The best known is the Tekya malware, which is thought to mostly affect games aimed at children.
Pro: Increasingly effective
Despite these issues, there is one major reason to put mobile app advertising on your list of marketing strategies. It has a much higher CTR.
In fact, according to research by Medialets, the click-through rate on in-app ads is at least twice that of web advertising. The average CTR for a web-based ad is 0.23%, but for app-based advertising, it averages a CTR of around 0.58%.
App-based ads have also been shown to be 13.5 times more effective in converting buyers than web-based ads. (source) It’s thought that this is because specific apps tend to appeal to a certain demographic, making it easier to target your market segment. (source)
Pro: Personalised targeting
Increasingly, targeted advertising on web-based display networks is being derailed by a mixture of opt-in (or usually opt-out) data options such as GDPR or ad blockers.
You might be targeting a tech-savvy and data-wary demographic, which means that traditional internet advertising might never be seen by them. In-app advertising often bypasses these limitations, allowing your ad to be displayed regardless.
This isn’t to say that there is no such thing as an ad blocker for mobile – there is. And yes, ad blockers are hugely popular. But, users are less likely to opt out of personalised ads on mobile apps compared to desktop.
Con: Low-quality and pervasive ads
One major concern for those advertising in apps is that you don’t always know where your ad is going to appear. And yes, it is possible for your ad to be one of those annoying pop-ups during a game or even to be a hidden ad that the user barely ever sees (which lays it wide open to click fraud).
Of course, this is the same problem as you can find with display ads or ever text-based ads. Although there are some initiatives to limit where your in-app ad appears, it is still best to monitor and edit your list as much as possible. There is an app-ads.txt option which advertisers using app advertising should make sure to keep updated.
Final word on mobile app advertising
If you’re considering advertising in mobile apps, there is plenty to bear in mind. Google, Bing, Facebook, and several other PPC ad platforms offer the opportunity to display your text, banner, or video ad in a huge variety of apps.
As the sector grows, it is also becoming the new front line in the fight against click fraud and ad fraud. Keep an eye on your ad performance, use click fraud protection, and monitor and block suspicious IP addresses or publishers.