Why marketers struggle to integrate in-app advertising

In-app advertising is still struggling with issues that have
largely been solved in other formats, such as ads that don’t
render properly, fraud and measurement. Despite these flaws,
however, advertisers continue to spend on in-app ads, because
that’s where their targets are: Consumers spend an average of
three hours per day on mobile, and GenZ spends 20 percent more time
on mobile apps than the rest of the population, according to
AppAnnie. 

“A lot of things solved for mobile were first solved on
desktop; now it is the same type of issues being solved for
apps,” says Amir Ghodrati, director of market insights at App
Annie. “People are finally realizing the value of in-app
advertising, but the industry has been slow to realize the
change.”

Getting it right is important because the stakes are huge.
Worldwide mobile ad spend, which includes both in-app ads and web,
is estimated to hit $190 billion this year, according to AppAnnie
data. Consumer spend within mobile apps, meanwhile, will reach $120
billion this year, up from $101 billion in 2018, AppAnnie
says. 

The problem(s) 

One hurdle marketers face is integrating in-app advertising into
their overall marketing mix. “Marketers and brands are looking to
engage their audiences in a mobile-first world, and apps—branded
experiences on the most personal device with unique and rich
functionalities—are to date the best way of doing just that,”
says Brian Quinn, president and general manager of mobile analytics
and attribution company AppsFlyer U.S. “But for many brands and
agencies, incorporating a mobile app into the larger context of
their marketing strategy is not an easy feat.” 

Quinn says that mobile apps are too often seen as an additional
channel, rather than a destination or engagement tool. He says that
the fragmented mobile ecosystem has resulted in a siloed marketing
mix that should, in fact, work together. 

“Connecting the dots between different consumer touchpoints is
technically difficult, and marketing teams are usually not set up
to tackle omnichannel marketing holistically,” Quinn says, adding
that making sense of data coming from so many different verticals
is challenging. 

“App marketing is maniacally performance-focused,” says Gadi
Eliashiv, CEO of marketing intelligence company Singular.
“Marketers live and die by the ROI of their campaigns, pretty
much like sales reps live and die by quota. So the biggest
challenge is finding and exploiting pockets of profitable growth in
a sea of thousands of ad networks, dozens of channels, hundreds of
marketing partners and enough promises from all of them to pave a
path to the moon—and that’s before you’ve even dealt with
outright fraud, which is rampant.”

App fraud is estimated to cost marketers nearly $13 billion this
year, according to Scalarr, up from $7.3 billion in 2018. 

One solution to thwart ad fraud is app.ads.txt, which the IAB
Tech Lab initially developed for the open web as simply ads.txt.
However, few app publishers are adopting the format. Ghodrati
believes most app publishers aren’t signing on because it adds
another layer of complexity. 

The solution(s) 

AppsFlyer’s Quinn argues that marketers need a complete
picture of all consumer touchpoints, regardless of where their
activities take place. “This is ultimately what the people-based
attribution solutions that are now coming into the market are
aiming to do,” he says. “They see highly measurable mobile apps
as the centerpiece in a holistic customer engagement strategy, and
connect various other channels—OTT, mobile web, desktop—into a
detailed customer journey.”

But making sense of all the data can sometimes seem impossible.
Marketing teams will spend millions on dozens of campaigns with
countless creative across a variety of different channels, all with
different vendors. “Somewhere inside that noisy haystack of data
are the needles of insight you desperately need,” Elisahiv says,
adding that advertisers lack “a system that unifies all your
marketing data around intelligent insights of growth.” 

Getting in-app ads such as video to display correctly—i.e. in
both vertical and landscape—is another challenge. But the number
of platforms marketers are using—some of which provide the
ability to display the correct ad format for in-app ads—is
growing, from six in 2017 to eight in 2018, AppAnnie reports.

And, as ad dollars continue to flow to in-app advertising, more
companies are entering the space to combat bad actors. “Anytime
there is an ability to make money, there is always opportunity for
fraud,” Ghodrati says. “Fraud becomes more sophisticated, so
you can’t rely on location of downloads and time spent in apps,
but more companies are starting to enter this space to combat
fraud.” 

Looking forward

Measurement will play a critical role for in-app advertising
both today and the near future, Quinn says. “The defining problem
of digital marketing over the next few years is how to balance
measurement that informs marketers on what’s working,” he says.
“A couple years ago it was GDPR,” which limited data
collection. “Now app marketers need to start thinking about what
will happen if the app’s advertising identifier goes away.”
That identifier allows marketers to track user activity, though on
a very limited basis.

Adds Quinn: “A more holistic view of the customer journey
across touchpoints will create a need to rethink how campaigns are
being created, implemented and optimized across channels. How will
brand messaging evolve when the ad you see in a news app is
optimized based on a TV spot you watched a week ago, and the
promotional email you received this morning? Instead of working in
traditional marketing disciplines, marketing teams will have to be
set up to orchestrate campaigns more holistically.” 

Source: FS – Advertising Blogs !
Why marketers struggle to integrate in-app advertising