Mobile App Monetization With The Facebook Audience Network
There are currently about 1.5 million apps in each of the two major app stores and the majority of them are free. With so many free alternatives out there, releasing a paid app can be a risky strategy. You are hoping that you can convince people to download your app and pay for it instead of downloading one of the many free alternatives. Obviously if there are so many free apps in the store they must be generating revenue. So how do they do it? One of the most common ways to monetize an app is with in- app advertising. That is, displaying ads inside your app. This method generates revenue by selling advertising space within your app. You get paid depending on the performance of those ads. It allows developers to generate revenue from an app without asking users directly for money. Users get to use an app and take advantage of its full functionality as long as they are willing to be shown the occasional advertisement. This guide will help you understand best practices for monetizing with ads and how the Facebook Audience Network can help your app business.
How Does In- App Advertising Work? We touched on this briefly earlier on, but let s look at how monetization with advertising works in a bit more detail. First you place an ad inside your app. Each time someone sees that ad they can either choose to ignore it, or choose to click on it. If a user clicks on an ad, they will be taken away from your app and either to a web site or to a page on the relevant app store.
How Does In- App Advertising Work? Earning Money With Ads Depending on the ad network you choose, you will be paid one of 3 ways: 1. Cost Per Mille (CPM). This means you get paid per 1000 ad impressions. Mille is Latin for 1000, hence the name cost per mille. When you are getting paid on a CPM basis, you generally get paid only a very small amount per impression, but you are not relying on people to click on the ad or install another app. You are guaranteed revenue as long as people are using the app because they will be seeing the ads. Facebook Audience Network pays on a CPM basis, meaning you get paid every single time an ad is displayed in your apps.
How Does In- App Advertising Work? Earning Money With Ads 2. Cost Per Click (CPC). This means you get paid each time someone clicks an ad. CPC advertising relies on people actually clicking on ads. Each time someone clicks on an ad you get paid. The amount you receive per click varies but it is usually only a few cents. Because you rely on people to take action before you receive any money, CPC can be difficult to monetize well.
How Does In- App Advertising Work? Earning Money With Ads 3. Per App Install (CPA). This means you get paid when somebody clicks on an ad in your app and then proceeds to download the app that was shown in that ad. CPA requires users to not only click the ad, but to also complete a follow up action by installing a new app. The amount paid per install is quite high (usually $1-5). This is because the advertiser is only paying for guaranteed results. This can be an effective monetization strategy if you are able to generate a lot of app installs for advertisers. But if people are not clicking on the ads or are clicking them but not installing the advertised apps you will not receive any ad revenue.
Advertising Terminology Before we dive deeper into the details of mobile app ads, here are a few commonly users terms you will need to understand. ECPM - Earnings Cost Per Mille This is the most common metric used to measure the earnings performance of an ad network. ecpm is the amount earned by the publisher for every 1000 ads that are displayed. For example: If 10000 ads are shown in an app, and the earnings from ads are $10, the ecpm is $1.
Advertising Terminology Placement This is the location in your app that you choose to show ads. E.g. At the main menu, game over screen or after completing a stage. Placement can have a big impact on the performance of your ads. Poorly placed ads in an app can irritate users & drive them away. On the other hand, well- placed ads that are unobtrusive & contextual can actually add value for users.
Advertising Terminology Fill Rate Fill rate is an extremely important metric that app developers need to understand. Unfortunately it is one that is often not reported by ad networks. Fill rate is how often an ad is actually displayed when one is requested. When it s time to show an ad in an app, the app sends a request to the ad network. If the ad network has inventory they will send an ad back to fill the spot. If the ad network does not have inventory, whether it s because of the geographical location or any other reason, they do not return an ad and nothing is displayed. A low fill rate is costly for developers. If ads are being requested but not being shown, revenue is being lost.
Advertising Terminology CTR - Click Through Rate This figure measures how often people click on an ad after seeing it. For example, a CTR of 10% means that for every 100 ads displayed, they are clicked on 10 times.
Advertising Terminology IR - Install Rate The install rate is how often people install an app as the result of an advertisement. For example if you show an ad for an app 100 times and people click that ad and download the app 5 times, the IR is 5%.
Advertising Terminology ecpc - Earnings Cost Per Click ecpc is a measure of how much you are earning, on average, each time someone clicks on an ad in your app. ecpc is calculated by dividing total ad revenue by the total number of clicks on ads.
Advertising Terminology ecpa - Earnings Cost Per Acquisition ecpa measures the amount earned per acquisition. An acquisition is an app install delivered to an advertiser. This happens when someone installs an app after clicking on an ad. ecpa is calculated by dividing total ad revenue by the total number of installs delivered.
What Makes a Great Ad Network? Relevant Content Displaying ads that are highly relevant to your users and fit in with your app can dramatically improve your ad revenue. This is because people are much more likely to click on an ad if it matches their interests and fits in well with the app they are using. Displaying highly relevant ads can improve the user experience rather than taking away from it. This means users will stick around for longer & there is a much lower chance of them becoming irritated by in- app advertising. Most mobile ad networks are particularly good at advertising certain categories or types of apps. It s unusual to find one that is strong across the board. These strengths come from the advertising partners that the networks have.
What Makes a Great Ad Network? Relevant Content For example, Applovin is very good for monetizing casino apps because they have a strong network of advertisers in the casino space. Chartboost specialises in mobile games and they have a solid network of game advertisers. Facebook Audience Network is partnered with ~2 million advertisers from all around the world and across all different niches. Because Facebook Audience Network has such a large, broad range of advertising partners they are able to provide relevant content for all types of apps. Couple that with the incredible targeting features offered by Facebook, and there is a very good chance that there will be super relevant ad inventory ready to be displayed in your app.
What Makes a Great Ad Network? High ecpm High ecpm means you are earning more per 1000 ad impressions. You want earn as much as possible from the ads that you display in your app. That s where having a high ecpm is beneficial. Highly relevant ads, shown at the right time to the right people lead to higher ecpm.
What Makes a Great Ad Network? High Fill Rates A lot of mobile ad networks will quote ecpm figures to promote their networks. What they don t often provide is details about fill rates. However the fill rate of a network is just as important as ecpm when measuring performance. This is because ecpm s don t factor in all of those times when an ad is requested but not displayed because there was no ad inventory in the network. A low fill rate can dramatically reduce ad revenue for app developers and often it s hard to pinpoint it as the problem. The Facebook Audience Network provides excellent fill rates across the board. In addition to this, Facebook is transparent in providing fill rate data to app developers & publishers. From the dashboard you can see exactly how many ads were requested, and how many of those were filled.
What Makes a Great Ad Network? Reliable, Regular Payments Each advertising network sets their own payment terms. This includes the delay between when revenue is earned and when it is paid out. It also includes the minimum payment threshold. Lengthy delays between when ad revenue is earned and when that money hits your bank account can have a big impact on your business. It s important for app developers to take this into consideration when they are choosing an ad network to use. Let s take a more detailed look at how payment schedules & payment thresholds work.
What Makes a Great Ad Network? Payment Schedule The payment schedule determines how long after the end of the month you get paid. Most ad networks will provide a Net x figure. x being the number of days after the end of the month until you are paid for that month s earnings. For Example: Net 30 = 30 days after the end of the month. Net 60 = 65 days after end of the month This report by Avocarrot found that a typical mobile ad network will pay monthly on a Net 45 basis. The Facebook Audience Network provides an extremely competitive payment schedule. Payments are made around the 21st of each month for the previous month s earnings. AKA a Net 21 basis.
What Makes a Great Ad Network? Payment Thresholds The payment threshold is the minimum earnings required before the account balance will be transferred to the developer s bank or PayPal account. Often a lower threshold is preferred because it means developers don t end up with money tied up in an ad network because they haven t reached the threshold. The downside of a low payment threshold is that it can often result in extra fees charged by payment processors. For this reason, some app developers actually prefer a higher threshold.
What Makes a Great Ad Network? Payment Thresholds Thresholds vary greatly between ad networks, and they will often be different depending on the payment method (e.g. PayPal vs. wire transfer). To give you an idea of how widely they can vary, some networks use a $25 minimum, while others are up to $500. The Facebook Audience Network uses a $100 payment threshold. This strikes a nice balance between avoiding lots of fees on small payments and not having to wait until your earnings are quite high before being paid out.
What Makes a Great Ad Network? Reliability Payment reliability is also an important consideration for app developers. There have been numerous stories of advertising networks failing to pay developers on time or even failing to pay at all! Ad networks are popping up regularly in the relatively young mobile app industry. The problem is a lot of these new startups don t have a proven track record of reliability. You simply don t have that problem with the Facebook Audience Network. We all know Facebook isn t going away any time soon, and you can rest easy knowing your ad earnings will be paid regularly.
What Makes a Great Ad Network? Easy Integration The last thing that app developers want is to spend lots of time and money implementing an ad network in their app. Thats why it s important for an ad network to have a simple setup & SDK integration process. Most ad networks have managed to achieve this, and the Facebook Audience Network is certainly one of them. The process is quick, easy and well documented.
Mobile Ad Formats & Best Practices Let s take a look at the 3 different ad formats supported by the Facebook Audience Network. It s no coincidence that these are also 3 of the most popular ad formats used in the industry. Banner Ads
Mobile Ad Formats & Best Practices Banner Ads Banner ads originated on the web and have now found their way into mobile apps. A banner ad is simply an ad that stretches across the screen, usually at either the top or bottom. Advantages of banner ads: Banners are often considered less obtrusive than interstitial ads as long as they are placed in a way that doesn t interfere with the apps UI. You can serve more impressions with banners because they can be on screen at all times.
Mobile Ad Formats & Best Practices Banner Ads Disadvantages of banner ads: Banners can irritate users if they aren t well placed. For example, if a banner ad is located too close to a button it may attract accidental clicks. They generally generate less revenue per impression.
Mobile Ad Formats & Best Practices Banner Ad Best Practices Placement Banners should be placed in a location where they do not cover any part of the user interface. If you plan on using banners, you should design the user interface with this in mind and design around the banner placement. Consider how people will use the app. Don t place banners in locations where they can be clicked on accidentally. A common mistake is to place a banner too close to a frequently used button, which results in people accidentally clicking the banner ad instead of the button. This is a guaranteed way to irritate people and drive them away from your apps.
Mobile Ad Formats & Best Practices Banner Ad Best Practices Content Because banner ads are shown very frequently, you should also make sure that different ads are shown on a regular basis. You don t want user to see the same ad every single time because if they are not interested in that particular app, they will never click your ad. The Audience Network lets you configure how frequently your banner ads are refreshed. This allow you to make sure people are seeing different ads as frequently as makes sense for your app.
Mobile Ad Formats & Best Practices Interstitial Ads Interstitials are full screen ads that cover the rest of the app UI when they appear. Users are usually required to press a button to close the interstitial ad and continue using the app.
Mobile Ad Formats & Best Practices Interstitial Ads Advantages of Interstitials These do a great job of getting the attention of users because they take the entire screen. This forces the user to look at the ad and make a decision to either click the ad or close it. Because they are good at gaining attention, interstitials often attract favourable conversion rates.
Mobile Ad Formats & Best Practices Interstitial Ads Disadvantages of Interstitials This ad format can be quite obtrusive, particularly if the placement and timing aren t well thought out. This can drive users away from an app.
Mobile Ad Formats & Best Practices Interstitial Ad Best Practices As mentioned earlier, interstitials can monetize better than banner ads, but if not done right they can irritate and drive away users. Here are some tips for monetizing with interstitials: Placement and Timing Interstitials should be placed in locations that are natural break points in your app. For example, a game over screen or a level complete screen. Don t surprise users with interstitials. Avoid placing interstitials in places where the user won t expect them. If a user is in the middle of using your app, don t interrupt them with an interstitial that they might accidentally click on.
Mobile Ad Formats & Best Practices Interstitial Ad Best Practices Placement and Timing It used to be common to show an interstitial immediately on app launch. This is now considered bad practice because it immediately sets a negative tone for new users. You want their first experience to be a positive interaction with your app, not an advertisement. Interstitials do a better job of getting people s attention, but they are also more obtrusive. For these reasons you should show interstitial ads less frequently than banner ads.
Mobile Ad Formats & Best Practices Native Ads Native ads give you control over the different elements within the ad (headline, text, image) and allow you to create the perfect ad creative for your app. Native ads aim to fit nicely with the user interface and provide a seamless and unobtrusive experience for users.
Mobile Ad Formats & Best Practices Advantages of Native Ads Provide the best user experience of any ad format by fitting seamlessly with your app. A better user experience means happier users and a higher retention rate.
Mobile Ad Formats & Best Practices Disadvantages of Native Ads They can take slightly longer to configure than other ad types because of the customisation required.
Mobile Ad Formats & Best Practices Native Ad Best Practices To take full advantage of native advertising you should ensure that the design matches the look and feel of your app. Design your app with native ads in mind rather than adding them as an afterthought. For the most seamless native ad experience you should plan exactly where you will display native ads and design around them. Make sure it is clear that they are ads. Don t be deceptive & make ads look like content. They should fit in seamlessly with your app, but users must still be able to tell that they are ads. Don t distort components. You should ensure that when customizing the different components of native ad that you don t distort things & make them visually unappealing.
Getting Started With The Facebook Audience Network It s easy to start monetizing your app with the Facebook Audience Network. All you need to do is fill out this simple form to register. Once approved, it takes as little as one day to get started! Sign Up For The Facebook Audience Network Now