Over 23,000 independent app developers, app publishers and studios leverage InMobi’s in-app ad monetization services. For these apps, InMobi is more than just one of many supply-side platforms (SSPs), ad networks and ad exchanges providing in-app ads from many nameless mobile app advertisers – rather, we are key to how they generate revenue and ultimately keep the lights on.
For these publishers and developers, what does it look like to monetize with InMobi? What kind of ad revenue are they seeing, and how does InMobi fit into broader app monetization strategies?
Let’s take a look. In this blog, we highlight the latest numbers and trends we’re seeing on InMobi Exchange, and how the in-app advertising landscape may change in the coming months.
By the end of June 2021, over 23,000 apps were getting mobile ad demand through InMobi Exchange, with 80% of them having directly integrated the InMobi SDK. Thanks to this global scale, we can see how the in-app advertising ecosystem is evolving and gain a good understanding of what it’s like for apps to monetize through ads.
This is a fairly representative sample of the app ecosystem at large too, across both app stores. After all, in August 2021, less than 7% of all apps available in the Apple App Store were paid apps.
For one, there’s a lot of money coming through programmatically. In looking at the first half of 2021 compared to the same period in 2020, mobile programmatic ad spending rose 273%. And there were 60 billion more programmatic ad requests in Q2 2021 as compared to Q1. This shows that monetizing apps through ads remains a great way to generate revenue.
What ad formats are being embraced? In 2021, around 60% of all placed ads were banner ads, with the remaining 40% being other formats like interstitial ads, native ads and video ads.
Why do banner ads remain so popular? For one, they’re fairly easy to insert into an app. Compared to other ad formats, banners don’t interrupt the user experience very much for app users. And so long as they remain a cost-effective way for advertisers to reach a mass audience, app developers and publishers will continue to support the format.
That’s not to say that other formats aren’t highly popular though. In comparing numbers from the first half of 2021 to the same period in 2020, advertisers spent 450% more on native ads, 243% more on vertical video and 188% more on interstitials.
As advertisers ramp up spending on these formats, app developers and publishers are sure to follow suit. Should eCPMs (price paid per thousand impressions) dip over time, more publishers may embrace non-banner ad formats since splashier formats like rewarded video tend to command higher prices.
It is important to note the outsized role that gaming apps play in the programmatic ecosystem. In the first half of 2021, around 80% of all in-app ad spending went to gaming apps. In fact, the top 10 publishers on InMobi Exchange were all games.
Of course, this is not to discount non-gaming apps, many of whom saw healthy growth already this year. Between Q1 and Q2 2021, spending on non-gaming apps rose 37%.
One way in which many app publishers are looking to further boost ad revenues and improve fill rates is through in-app header bidding, or in-app bidding as it’s sometimes called. With in-app bidding, all potential advertisers (and their programmatic partners) have the opportunity to review and bid on all potential ad placement opportunities.
Between Q1 and Q2 2021, not only was there a 26% increase in ad requests from in-app bidding, but there was also a 12% decrease in ad requests from waterfalls (also known as multi-call order, or MCO). In this period, we observed 52% growth in ad spending on in-app header bidding supply.
Why is in-app bidding beneficial? For publishers, it allows all potential ad sources to bid for all available ad inventory – as compared to MCO, where demand sources are tapped in a set, sequential order. This increased competition invariably increases eCPMs and thus revenue. It also often boosts fill rates, since all interested demand sources get to bid on all ad placement opportunities.
But how will app publishers and the in-app advertising ecosystem overall deal with privacy changes, such as Apple’s AppTrackingTransparency framework or upcoming Android opt-out options? With the free, ad-supported app model still work going forward, or will more apps embrace paid options like in-app purchases?
Early indications showed advertisers moving budgets away from iOS, in a sign that privacy changes were impacting how app publishers were monetizing their iPhone and iPad apps. In looking at numbers from July 2021 as compared to January 2021, Android eCPMs rose by 20% while iOS eCPMs fell by 16%.
But we think that these changes are short-lived. For one, iOS users are just too valuable to ignore, so invariably advertisers will invest further in this ecosystem.
And even for the advertisers that eschewed in-app entirely as a result of ATT, the mobile app audience is truly too big to pass over. Not only do Americans spend more time on mobile than they do engaging with any other single media source, but around 90% of all time spent on mobile is devoted to apps. If advertisers want to reach their best audiences, they have to go through apps.
On top of it all, the doom and gloom that accompanied the initial rollout of iOS 14.5 has largely been overblown. For one thing, opt-in rates are much healthier than anticipated. While the industry was largely expecting IDFA opt-in rates to be around 20%, InMobi Exchange found that 33% of all iOS users running iOS 14.5 or higher had opted in by the week of August 22. For non-gaming apps, the opt-in rate then was 39%. Gaming apps had a lower opt-in rate of 25%, but even that is above expectations.
Plus, even among the users without an individual device identifier, advertisers have still been able to effectively measure their campaigns using SKAdNetwork, Apple’s own measurement solution. For example, InMobi DSP has been able to help its clients dramatically scale up their mobile app user acquisition campaigns using SKAdNetwork. It is worth noting that the vast majority of apps are supporting SKAdNetwork right now, which helps advertisers and their partners to use this measurement option in the first place.
In addition, for targeting users where an identifier is available, agencies and direct brand advertisers are increasingly leveraging identity solutions like LiveRamp’s Authenticated Traffic Solution (ATS) to gain a view on how prospective consumers are engaging with media across screens. And by using InMobi’s UnifID to easily integrate with multiple identity solutions, publishers have seen a 39% increase in average eCPMs for bid requests with identifiers attached to them – and on iOS, publishers are seeing a 50% increase in eCPMs.
So what does this all show? Even with Apple’s changes, in-app advertising in the iOS ecosystem is alive and well. Many apps are continuing to successfully monetize their iOS apps through advertising, and regardless of what happens in the industry, this will likely continue for the foreseeable future.
Interested in monetizing your app through InMobi? Head to https://publisher.inmobi.com/signup to create an account and get started.
Register to our blog updates newsletter to receive the latest content in your inbox.
