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Download the accompanying ebook here: http://info.nanigans.com/driving_forces_of_change_in_mobile_advertising In less than a year’s time, Facebook became the market leader in mobile display advertising, outpacing giants like Google and Apple to control approximately 25% of all mobile display ad revenues. What represented 0% of Facebook’s ad revenues a year ago is on track to be a billion dollar business this year in the United States alone. Why exactly have mobile ad dollars moved so quickly to Facebook? The answer is simple: Facebook and Preferred Marketing Developers like Nanigans are solving very real challenges on behalf of mobile marketers – challenges that center on the three core pillars of any successful advertising campaign: 1. Targeting 2. Creative 3. Media buying Combined, these driving forces of innovation have resulted in advertisers achieving 15-20 times higher clickthrough rates on Facebook mobile as compared to desktop and, most important, are revealing the true ROI of mobile ad investments. **This presentation was given at the Massachusetts Innovation Technology Exchange's Demystifying Mobile Marketing event held on May 2, 2013 at the Federal Reserve Bank of Boston.
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Cheryl Morris | Director of Marketing | @cheryllmorris
Evolution in mobile advertising –
#1 in less than a year –
#1 in less than a year –
$1billion
$200,000,000
“The year of mobile” – a slow pace of innovation
Facebook in mobile – not 5 years
Facebook in mobile – moving fast
14% of FB’s ad
revenues
23% of FB’s ad
revenues
30% of FB’s ad revenues
2012 2013
Facebook in mobile – solving real challenges
Targeting and creative – success from desktop shifts to mobile
15-20X higher CTRs
A second evolution – how we buy customers
ROI – measuring and buying media based on it
driving forces of change in mobile…
1. TARGETING
2. CREATIVE
3. MEDIA BUYING
1. TARGETING
2. CREATIVE
3. MEDIA BUYING
750 million people
750 million people – with identities
Unprecedented targeting – Facebook
Lack of identity – targeting attributes are non-personal or inferred
“Spray and pray” – buy blindly and opportunistically
Unprecedented targeting – the alternative
Device
• Type• OS version• Wi-fi connectivity
Behavior
• Actions taken with sites and apps
• Offline purchase behavior
CRM
• Customers from your CRM database matched to Facebook profiles
• Friends of your fans/users
Demographics
• Age• Gender• Location
Affinities
• Likes• Interests• Conversations
Social
• Relationship status• Education level,
college, major• Employer, position
Unprecedented targeting – from affinities to your CRM
Device
• Type• OS version• Wi-fi connectivity
Behavior
• Actions taken with sites and apps
• Offline purchase behavior
CRM
• Customers from your CRM database matched to Facebook profiles
• Friends of your fans/users
Demographics
• Age• Gender• Language• Location
Affinities
• Likes• Interests• Conversations
Social
• Relationship status• Education level,
college, major• Employer, position
Custom audiences – define customers to remarket and expand to look-alikes
Your CRM Remarket
MATCH
1. TARGETING
2. CREATIVE
3. MEDIA BUYING
Banner ads – tiny, ugly, intrusive
Facebook mobile ads – huge ads
Facebook mobile ads – huge ads, acts like content
Facebook mobile ads – huge ads, acts like content, designed to drive behavior
Page post ads – consistency across channels
20-50XhigherCTRs than RHS
Mobile app install ads – fueling app discovery and distribution
1% CTR
1. TARGETING
2. CREATIVE
3. MEDIA BUYING
Cost Per Impression – CPM
Cost Per Click – CPC
Cost Per Action – CPA
views mobile
ad
installs app /
registers
continues to purchase
over time
clicks mobile
ad
makes first
purchase
Downstream behavior – after the action
views mobile
ad
installs app /
registers
continues to purchase
over time
clicks mobile
ad
makes first
purchase
Downstream behavior – after the action
Understanding ROI – return on ad spend
how much it costs to acquire a customer
how much you earn off that customer
how much greater your LTV is than your CPA
CPA
LTV
ROI
Understanding ROI – return on ad spend
LTV
ROI
how much it costs to acquire a customer
how much you earn off that customer
how much greater your LTV is than your CPA
CPA
LTV
ROI
Understanding ROI – return on ad spend
ROI
Understanding ROI – return on ad spend
how much it costs to acquire a customer
how much you earn off that customer
how much greater your LTV is than your CPA
CPA
LTV
ROI
Pitfalls of CPA – an example
Pitfalls of CPA – an example
$10 CPA
Pitfalls of CPA – an example
$10
Pitfalls of CPA – an example
$10
$10 $9
$12
Pitfalls of CPA – an example
CPA LTV ROI
$9 $10 11%
$12 $50 317%
33% 400% 28XIncrease
Pitfalls of CPA – an example
CPA LTV ROI
$9 $10 11%
$12 $50 317%
33% 400% 28XIncrease
Pitfalls of CPA – an example
CPA LTV ROI
$9 $10 11%
$12 $50 317%
33% 400% 28XIncrease
Pitfalls of CPA – an example
and it gets worse…
Audience CPA Network’s Margin
Steve $9 $1
Broke Brian $7 $3
Debtor Dan $5 $5
CPA – “Customer Permitted Arbitrage”
$10
CPA – buying Likes
DEADLY SINS OF CPA BASED BUYING7
1. Results in opportunistic buying
2. Encourages arbitrage models
3. Discourages buying high value audiences...
… and encourages buying low value audiences
3. Discourages buying high value audiences...
4. Values all customers equal
5. Limits campaign scale
6. No price elasticity
7. Overpay for cheap audiences
How should we buy to avoid all these pitfalls?
ROI MOBILE
4.5M
Fast growing retailer on desktop – longitudinal impact
total member
base
38%4.5M
Fast growing retailer on desktop – longitudinal impact
total member
base
acquired from
38% 400%4.5M
Fast growing retailer on desktop – longitudinal impact
total member
base
more valuable customers acquired
with ROI
acquired from
Top mobile app developer – results
Nanigans
Mobile ad _x000d_networks
74%
49%
Optimizing for ROI – 51% Higher ROI
(CPA)
(ROI)
49% ROI
7 days after engaging with ads
Top mobile app developer – goal
49% ROI
performance on other mobile ad networks
Top mobile app developer – goal
20+
Top mobile app developer – strategy
49% ROI
in half the time!
Top mobile app developer – results
Top mobile app developer – results
92% ROI
breaking even on ad
spend
CPA by definition means you’re not buying for ROI !
1. TARGETING
2. CREATIVE
3. MEDIA BUYING
Targeting –
no longer inferred or non-personal
Targeting –
Creative –
no longer tiny banner ads
Creative –
Media buying –
no longer based on proxy metrics
like CPA
Media buying –
Nanigans_x000d_(ROI)
Mobile ad _x000d_networks_x000d_(CPA)
74%
49%
ROI Based Buying – 51% Higher ROI
“Today, there’s no argument – Facebook is a mobile company.”
