Even though there is evidence that smartphone sales are slowing, that doesn’t appear to be the case for the app economy. In 2017, consumers downloaded 197 billion apps – a figure which is projected to grow to more than 350 billion by 2021, according to statistics cited in a recent Forrester report [download page] produced with PubMatic.
The study combines this forecast with a survey of media planning and buying professionals, who spent an average of 44.5% of their digital advertising budget on mobile channels, split equally between mobile in-app advertising (22.3%) and mobile web (22.2%).
As such, mobile budgets for these respondents command the largest share of their digital spend – a fact that shouldn’t be surprising given that two-thirds of consumers’ digital media time happens on smartphones. Despite challenges for software publishers, app engagement also appears to be up, making in-app advertising an attractive prospect for media buyers.
Buying such in-app media is often done programmatically, with 68% of the respondents saying they always include programmatic in-app advertising in their digital media plans. Ad format choice is broad too, with funds being split between social media (26%), video (26%), display (25%) and native (23%).
In terms of the perceived benefits for a programmatic approach, the largest share of respondents (56% for both in-app advertising and in-app video) pointed to its ability to provide better audience targeting. Closely following, some 54% indicated that these media provide more effective customer engagement, and around half (47% for in-app ads, 53% for in-app video) reported that they improved / optimized targeting of marketing campaigns .
Targeting also comes top of mind when buyers look at choosing a publisher, with around three-quarters (73%) citing this as their most important factor.
Advertisers appear to be pleased with the quality that in-app advertising offers. Some 86% consider in-app video to be of above-average quality, 77% feel so for in-app display, and a similar proportion (72%) find the same to be true for in-app native advertising.
That being said, buying inventory isn’t being done with complete confidence. More than half of brand-side respondents reported a fear of fraud for both in-app (52%) and in-app video advertising (57%). Agencies, meanwhile, are most concerned with viewability measurement challenges (48% for in-app ads, 44% for in-app video). As such, around half of these buyers – on both the brand-side and agency-side – list fraud and viewability verification as the most valuable action that publishers and adtech companies can provide.
The full report can be downloaded here.
About the Data: 336 media planning/buying decision makers based in the US, EMEA and Singapore were surveyed in November 2018, 74% of which had marketing budgets of $1 million or more.