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Why You Can’t Ignore App Install Advertising

Posted Jul 18, 2019

With millions of options available to consumers, it’s not enough to create an innovative app that will keep users engaged and excited. Developers are having to learn about the benefits and strategies of app install advertising in order to stay ahead. As the demand for app install advertising grows, so does the need for more advanced strategies and technologies. Recent studies have showcased the crowded market of mobile apps and the ways developers can stand out among their competitors.

User Growth Slows Down While App Releases Speed Up
While many countries see growth in smartphone users, eMarketer has revealed that developed markets like the United States are starting to see growth slow down. Beyond 2019, the percentage change in U.S. smartphone users is expected to decrease to only 1.5% in 2023. 

Despite these slowdowns, the market is becoming increasingly saturated as thousands of apps are released every week. Mobile app intelligence company, 42matters estimates that the average number of apps released on the App Store per day is 1,018. Additionally, data platform Statista says there were 1.8 million apps on the App Store during the first quarter of 2019, while the Google Play Store had 2.1 million in the same quarter. With so many apps fighting over users, developers are seeking the best and most cost-effective strategies for user acquisition.

App Install Advertising Spend Continues Rising
The crowded app market has led publishers to invest in more resources to attract high-quality users. Incidentally, the amount of money going to app install advertising is growing rapidly. AppsFlyer released a forecast that indicates that global app install spend will reach $51.6 billion by the end of the year. Furthermore, their analysis states that ad spend will rise by 65% from 2018 to 2020, reaching $64.1 billion.

With increased competition, advertising for apps is becoming more expensive. In addition to the higher pricing of campaigns, ad spend will continue to grow due to increased mobile use, more smartphone adopters, and more apps being released.

Growing Demand Pushes Advancement in App Install Advertising
As money pours into ad spend, there have been pushes for advancements in both strategy and technology for app install advertising. Companies are able to provide more precise data, analytics, and platforms to achieve real-time optimization for campaigns. 

Our head of global performance, Vikas Gulati spoke to eMarketer regarding the sophistication of app install advertising. “A few years back, everybody was just spending money mindlessly, without looking at what the return is going to be,” said Gulati. “It was all about trying to get more users, without having a business model in place. But today, the game has completely changed. Everybody starts with a business model first. They look at what the expected return on ad spend is, either through in-app purchases or through ad-based monetization. And then they define their user acquisition price.” 

In addition to real-time optimization, advertisers can also look beyond installs. Post-install actions like in-app purchases can be used for more revenue but also more information. Data from purchases or app activity can be used for further ad targeting and messaging. Furthermore, the same data can show a campaign’s effectiveness with the lifetime value of users and the return on ad spend. The growing need for app install advertising has made developers more knowledgeable but also more demanding. 

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