Another year went by at a faster pace than we would have liked. And while the world braces for another wave of uncertainty, some things seem to be a bit easier to predict. It is time to look at some key trends that publishers will likely see in 2022.
1) Having An Identity Strategy Will Be Crucial
Privacy is a long-term issue, and it isn’t going to be solved tomorrow. In the complex story behind identity sits a mix of consumer concerns, increasing ad fraud and ever-growing privacy restrictions led by both regulators and mobile companies.
April 2021 saw the rollout of Apple’s App Tracking Transparency, leading to the loss of IDFA (Apple’s identifier for advertisers) when users opt out starting from iOS 14.5. Android will follow as per their announcement in June 2021. They have stated that beginning in late 2021, when Android 12 OS users opt-out of personalized ads, Google Play’s advertising ID (GAID) will not be made available to use by app developers for any purpose.
The privacy restrictions have pushed mobile publishers to deepen their relationships with their consumers and develop first-party data strategies. Many publishers, web and mobile, have implemented login to collect an email address from their users.
The rise of identity solutions as an alternative to mobile identifiers built off email address-based IDs has raised some interrogations about their sustainability. But first-party data isn’t only about emails. There are many signals that publishers can leverage to build better experiences and monetize in a privacy-focused manner. The tough job is to get user consent.
On the other hand, we may see IDFA opt-in rates increasing as consumers get tired of seeing irrelevant ads and aren’t able to navigate through customized experiences. I certainly am. Plus, publishers are experimenting with new ways to get opted-out users to opt back in.
At InMobi, we are monitoring the opt-in trends in our IDFA Center and we have observed opt-in rates slightly increasing in the past three months across our exchange.
Parallelly, mobile advertising IDs or MAID-less alternative strategies will increase to maximize addressability across unconsented inventory. Contextual targeting is coming back, and cohorts and other initiatives like FLoC (Federated Learning of Cohorts) by Google seem to be the chosen strategy to respect user privacy while maintaining scale.
Regardless of the path chosen to monetize their audiences, there is a real opportunity for publishers to connect their data with advertisers, whether it is through data clean rooms or solutions like on-device targeting. Expect to see these options become far more prevalent in 2022.
2) The In-Game Opportunity
As of spring 2020, gaming became one of the preferred activities when Covid 19 lockdowns started across the globe. And according to App Annie's latest mobile gaming report, mobile gaming is expected to surpass $120 billion in 2021.
According to the IAB, gaming outranks most forms of entertainment and is one of the most valuable industries in the world; it is estimated to be worth an enormous $159.3 Billion with an audience of 2.7 billion global gamers expected to be in play by the end of 2020.
Many gaming companies witnessed a boom in user engagement and ad spend. One of which was Activision Blizzard. The company’s U.S. advertising revenue kept increasing between 2020 and 2021 and remains in the top five grossing mobile games worldwide. Other mobile gaming giants like Zynga saw similar growth in this period.
Advertisers have started seeing the power of gaming audiences and its diversity. The myth of the teenager playing in the basement is now gone.
One of the most interesting trends in this burgeoning space has been the growth of in-game advertising, also sometimes known as native in-game advertising.
IAB defines in-game as how brands can directly influence gameplay visuals/audio with their messaging or alter the gaming experience through skins and sponsored content. In other terms, in-game advertising describes native ad placements within mobile games, which appear during gameplay. Ad formats include static band dynamic banners, video and audio ads.
For example, let’s say someone is playing a metaverse-style game. The virtual cityscape may include ads on bus stops, billboards, etc. Thanks to the rise of in-game advertising, brands now have the opportunity to programmatically place ads in these scenarios.
In-game being a portion of the gaming market is expected to grow by almost $11 billion until 2024.
In-game as a medium does not rely on IDFAs/mobile IDs or cookies, and therefore represents a sustainable alternative for gaming app developers. Most of targeting in-game is done on a contextual basis with a mix of statistical non-precise signals like locations and demo data. Another important aspect about in-game is the lack of third party viewability measurement, which is currently a key challenge for advertisers. As adoption increases and reporting matures, we expect measurement companies and the IAB to solve for the technology to help standardise the process and metrics to ensure transparency for advertisers and success for publishers.
To help our advertiser partners and gaming publishers expand into in-game, we have forged partnerships with leading in-game advertising platforms such as Anzu, Frameplay and others. In 2022, we expect to see both more brands and more publishers taking advantage of the opportunity provided by in-game advertising.
3) Monetization Moving In-House
While 2021 saw a rise in ad tech stocks, consolidation in the space continues on its path as companies seek to build their own alternatives to the major walled gardens. Still, complexity doesn’t seem to be decreasing, especially around data and privacy.
Publishers want fewer and simpler solutions. Mediation platforms and supply-side platforms (SSPs) in particular have to reinvent themselves beyond the traditional business model to provide a tech enablement that is transparent, modular and goes beyond the current tools.
This goes hand in hand with the ambitions that most CIOs have express in the latest Gartner’s 2022 CIO Agenda Report. By 2024, 80% of CIOs surveyed will list modular business redesign as a top five reason for accelerated business performance.
Some of the biggest publishers have already been leading the way with moving their monetization in-house, through either building their own tech-stack or adopting a white-labelled solution or utilizing self-serve platforms that allow them to be in control of their monetization strategy. Many mobile publishers are thinking of taking this route, with some big gaming publishers having their own custom mediation solution.
At InMobi, we believe in building platforms and tools that support our client's business goals, for customers of all sizes. And, one key goal for us in 2022 is to build scalable self-serve capabilities into our SSP platform that publishers can customize and seamlessly fit into their monetization strategy.
On a final note, we wish you a Happy New Year.
Have any thoughts on these trends or the future of in-app ad monetization? You can always drop us a line at https://www.inmobi.com/company/contact.