App Monetization During the Holidays: Choose Your Bidding Partners Wisely

The holiday season always is a huge opportunity for publishers and app developers to make the best returns from their ad inventory. Advertisers and their DSPs typically rely on the last three months of the calendar year to boost annual sales and increase ad spending to reach holiday shoppers.   

While the pandemic has resulted in a deceleration of traditional advertising spending, overall budgets have moved over more sharply to online to target app users. Brand advertisers in verticals like retail, QSR (quick-service restaurants), and financial services are expected to see an increase in ad spending during this quarter, despite the uncertain state of the economy. Take for example Walmart, which announced an extension of Black Friday Deals to reach users through the month of November. The performance or user acquisition (UA) advertisers will also continue to spend as app usage soar. The bottom line is, holiday advertising presents a great opportunity for mobile publishers to monetize on the increased demand queued up to flow through in-app exchanges.   

To maximize monetization though, it’s important to prioritize the right mix of supply-side platforms (SSPs) and exchanges working with your ad stack as bidders. Here are a few variables to consider as we dive into November:  

Variable 1: Demand Affinity 

We recommend that you talk to your bidding partners (SSP/Exchange) to understand the projected demand growth in Q4 2020. Your conversations must factor in the following:  

1. Growth in brand and UA spending: To elaborate on this, let’s take the example of InMobi Exchange. In 2019, InMobi Exchange grew north of 25% between Q3 and Q4. Brand spending witnessed 4x growth and UA spends grew by 7x in this period. Our exchange grew by a whopping 90% in Q3 2020, compared to the previous year. With both brand and UA spending bound to increase in Q4 2020, we are expecting ad spending to clock new heights across regions. It’s important that you speak to each bidder and know what kind of growth they have observed and are likely to see in this quarter from the DSPs and/or advertisers they have onboard 

2. Agency Partnerships: Understand if there are unique demand partnerships and/or agency preferential status as part of their supply path optimization (SPO) efforts. These are important indicators of sustained growth that you can bank on not just during the holiday spike in Q4, but also in Q1 2021 when spending otherwise tends to go down. At InMobi Exchange, we pride ourselves on being an approved in-app partner of choice for the world’s largest agencies 

Variable 2: Returns on Full-screen Inventory: 

The last quarter also sees an increase in spending on high-performing, non-display formats given their higher engagement and conversion rates. In U.S, the typical video click-through rates (CTRs) were 10x greater than the CTRs for banners on average and 2x greater than the average CTR for native ads. InMobi also sees, on average, video completion rates of around 80% and viewability over 90% (across OM SDK, IAS, Moat and DoubleVerify) via private marketplace deals.  

However, many apps miss out on higher monetization opportunities by limiting the amount of inventory they make available to exchanges and SSPs. This can be especially detrimental for fullscreen ad units (including video and interstitials), which already see higher CPMs (cost per thousand impressions) by virtue of the format’s high performance. Features like podding on video ads, which allows app developers to display back to back ads within an ad break slot, provides a huge opportunity for publishers to make up to 1.5x returns for every impression opportunity. 

As a preferred bidder on all major header bidding platforms, apps from some of the leading gaming publishers (on iOS and Android app stores) have opened fullscreen inventory at scale on InMobi Exchange in the previous quarters and have seen their ad revenue grow 5x in this period.  

With demand organically growing in Q4, it’s important that you capitalize on this surge. Speak to your partners to understand how they meet advertiser KPIs on high-performing full-screen units and the kind of growth they have seen in such formats. Additionally, as a rule of thumb, we would recommend that you open full-screen inventory to exchanges through your header bidder, so that you earn more from what should already be a highly lucrative ad unit.  

Variable 3: Overall Yield 

Q4, more than any other quarter, also requires close attention to yield. Having the right mix of SSPs and exchanges ensures efficiency in competition and improved returns between partners.  

How often does the bidder return a fill or what percentage of impressions do they bid on? How often do they win auctions in your ad server? If a partner isn’t bidding on a significant portion of your impressions or if their win rate is low, then you should probably reconsider their rank within your monetization stack.  

While theoretically, you can add as many demand partners as you wish, it makes better sense to optimize the select few (based on the three variables detailed here) to rake in maximum revenue during a peak quarter like Q4. 

We would encourage our publishers to have such conversations with every exchange and SSP you work with, more so in Q4. Once you have a better picture of the demand and yield potential, be prepared to shuffle the order in which you rank or activate bidders in your waterfall or header bidding set up.  

If you have any questions on the demand that we have queued or expect to see in Q4, please write to your dedicated customer success manager and we would be happy to walk you through our readiness to tap into the Q4 growth wave.