Thought Leadership
Performance In Mobile: An Interview MobAd Agency CEO Daniel Solden

daniel-soldenDaniel Solden
CEO
MobAd Agency
(Now Chief Marketing Officer at Inspiring Interns)

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For those of us that aren’t familiar with MobAd Agency, please tell us a little about yourselves, and the type of clients that you represent. 

I have been in mobile for many years, I started by helping top-tier VCs recruit for their portfolio companies, such as Glam, Stardoll, Mobango, Skype. This is when the best phone that was available was so bad from a content perspective it was amazing people actually used them!

A few years later I joined M&C Saatchi Mobile, where I headed up business development, looked after tracking, and optimisation of some large direct response accounts.

After a little while I left to start MobAd, a direct response mobile advertising agency. MobAd specialises in getting a better return on investment & achieves this using extensive market knowledge, highly granular statistical testing, and focussing on CPA goals as opposed to just CPI.

Our clients include Red Bull, Hailo, Sega, Shrek…

 

What are some of the typical performance metrics, beyond CPIs, that you use to measure success for clients?

For gaming clients, ARPU > CPI is the quintessential formula for success. Another important KPI to achieve is the lowest cost per open, in other words retention.

 

Are there certain genres or app categories that you would say are more difficult in mobile user acquisition, and why?

Yes, absolutely. Mobile advertising is still relatively untargeted so niche apps (non-gaming) cost significantly more to drive a download than let’s say casual games from Ketchapp.

 

What about countries or markets that you have found to be more challenging for mobile user acquisition? Why do you think this is the case?

Poland is a tricky market, there’s a shortage of mobile inventory full stop, iOS is almost non-existent, and Android is pretty scarce. Adding to this, there is not enough innovation or growth or maturity in the Polish market, so the ecosystem is not really developed there yet.

 

What are your thoughts on the hybrid Ad Network / Agency model, where companies can help mobile apps with not only user acquisition, but also localization, translation services, and creative asset creation?

Specialism is the key to success, having said that an all in one solution is desirable to many clients.

 

Do you think that CPIs in Tier 1 Countries (US, UK, Canada, Australia, Germany) are starting to get too competitive? Is there a certain point at which it could become unsustainable for mobile apps to continue acquiring users in these markets?  

For good or for bad, mobile rates are climbing, which is pushing out companies without a top-class product or funding to drive scale. Rates have more than doubled & show no sign of slowing.

There are a few key ways to advertise: social, video, DSP, affiliate, publisher direct. All suffer from advantages & disadvantages. Affiliate is cheap but poor quality & riddled with fraud. Publisher direct is often for brand & too expensive. Video is a strong performer for games only. DSPs are expensive but good value (relatively). And social is the best, but you certainly have to pay a high price.

 

How do you feel about Mobile User Acquisition in Tier 2, or Tier 3 markets? Are there maybe some hidden gems or pockets of valuable audiences in these markets that have worked well for your clients?

That’s a very good question. Part of what we do is finding arbitrage opportunities globally, including lower tier markets. iPad users are generally big spenders regardless of their physical locality.

 

What are some of the fastest growing markets you know about, and do you have any growth numbers for these countries?

Most of the markets are growing ridiculously quickly, this includes UK & US. South America is fast, but Asia is probably the fastest. I’d say a good measure to use would be circa 100% year on year growth.

 

Does having an understanding of the economy for each of these countries help with user acquisition? For example, being able to know that one currency is on the rise against another, or that the % GDP growth or mobile penetration for the country is going up– do you incorporate some of this research into your UA efforts?

On a basic level we’re looking for a relative disparity between the cost of acquisition & the value of the user. We usually work within the client’s localisation requirements so don’t always have flexibility, but where we do, great savings can be made.

 

Do you think that mobile user acquisition could potentially be in a ‘bubble’?

Absolutely not, the percentage of ad-spend vs time spent on mobile devices still lags compared to other media.

 

What percentage of the top apps in each genre do you think are actually making money? How are the rest, that are not profitable, able to continue doing paid user acquisition, or, what are some of their strategies if they are not doing paid UA?

The majority of spend comes from two types of companies: big brands & VC backed developers. Both have ample money to invest ahead of the curve, hoping to make a profit later down the line, based on improvements to product, monetisation, CRM & UA techniques, and virality.

However, if we take a snapshot, then yes, on the face of things, a lot of companies are not making a profit. As a rough measure I’d say the top 10% are doing well or the top 50-100 in each grossing category.

A lot of companies are multi-faceted eg can do SEO, PPC, non-mobile affiliate to drive scale- so mobile UA isn’t the only option, but in my opinion, it’s the best option for most companies. Other tactics we’ve seen recently include licensing a brand. Glu licensed Kim Kardashian & Tiny Co Family guy. This relieves the need to do a lot of UA as the organic downloads will be huge. And when UA is being done, the CPI will be significantly lower than otherwise & post-download conversions higher.

 

What are some average CPIs you’ve seen by genres in key markets you’ve worked on?

It’s product dependent, but Brazil & Turkey are great markets for price & active users, half the cost of the West.

 

How do average CPIs compare from mobile games to mobile apps in other categories like Travel, Entertainment, Social, & mCommerce?

It varies massively from $0.50 (casual games) to $10.00 (m-commerce). The highest CPI account I ever looked after was $20+ in the fintech space.

 

How do you think some of these larger gaming companies like King and Supercell, that spend millions per month on mobile UA, deal with duplication of users across all the networks they work with?

They will be negatively targeting using a DSP & a PMD. When buying on non-programmatic (eg video, affiliate, publisher direct) media there will be a tremendous duplication, due to the mass-market reach of the apps, although this can be justified as brand spend to a certain extent.

 

What are some of the fraudulent techniques that some of the less savory mobile ad/affiliate networks use to con marketers?

The first point to mention & it’s a little sad, is that the less savoury mobile ad/ affiliate ad networks are also some of the most reputable & well-known! We have been stung as has the whole industry, particularly the bigger gaming spenders, from impression to install fraud or impression to click fraud. This as it turns out is technically not illegal (although it should be!), and takes a user directly to the app store or to auto-download without even clicking on a banner.

The old-fashioned techniques of using adult traffic, filtering in incentivised, fiddling with click to download rates by filtering in non-converting media, and bot traffic are still highly prevalent & growing rapidly in sophistication.

What’s particularly worrying is that a bot can now learn to play & complete your mobile game and for all intents and purposes looks like a human player.

 

What are your thoughts on view-through attribution, and other means of user acquisition like direct deals with other mobile publishers?

It’s interesting but consistency is the most important approach. Ie if you use view-through for one publisher eg Facebook you should use for all, or it will taint the numbers.

One of the keys to achieving success in mobile advertising is scale, so i’m not sure direct deals are always necessarily the way to go. It’s often more efficient & effective for media to be grouped together by networks & offered to the market programmatically. It also depends where in the chain you’re buying media. DR tends to buy the same media as brand, just a little further down the chain, at lower prices.

 

At what point do you think it will be more commonplace amongst marketers to use DMPs and data in mobile advertising? Why do you think that it isn’t as prevalent now?

DMPs are already relevant if you’re interested in location data or brand type interest segments. If you actually want to lower your CPI & improve post-download conversions then this data is less relevant. To date, we haven’t seen many great data plays that actually help from a DR perspective, which is why we decided to launch our own DMP.

We’re hoping over the next year, that the market will come to use our DMP as the standard go-to-market strategy for a DR UA campaign.

The market has taken longer than expected to mature. To start with companies struggled with serving banners, then struggled to track ROI, only now are we moving to targeting & how to improve the UA buy with companies like Facebook, Twitter, and DSPs.

 

I hear that you are working on a DMP/Data product in-house, please tell us, to the extent that you can reveal, how you envision it working for mobile advertisers. 

Most DMPs talk about nothing but data, we like to talk about nothing but results. In a nutshell whatever CPA you are achieving on programmatic media (Facebook, Twitter, DSPs, etc)- our data can reduce your CPA by 50% by improving targeting efficiency & reducing wasted impressions.

 

Lastly, what do you think the future of mobile user acquisition will look like?

I see the industry consolidating around key verticals, but also see new innovations popping up all the time.

One of the most disappointing things I’ve seen so far is the low standard of UA buys across the industry. People are wasting a tremendous amount of money and even worse, they’re damaging their brand by unknowingly dealing with unscrupulous networks.

MobAd prefers to focus on the safer advertising opportunities & to maximise returns on these top-channels. I think we’re going to see the industry move away from affiliate, towards higher performing programmatic inventory, even if it “appears” to cost slightly more, the value is significantly better.

 


 

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