Mobile apps are home to a wealth of user data — and since these apps collect this first-party data on an opt-in basis, they can pass it on to advertisers. This data is then used for creating valuable targeting parameters, making it easy for advertisers to reach their target audience.
As published in our newly-released H1 2019 Global In-App Advertising Trends report, user data isn’t just a win for advertisers. Apps that collect user data, and then share this data with advertisers, can significantly increase the price of their ads.
User Data Included in the Ad Request
Users regularly share their data freely with apps in exchange for in-app perks and conveniences such as location-based services and personalized discounts. This data then provides advertisers access to targeting capabilities not available with other media. The user data most often collected in-app includes:
A device ID is a unique string of numbers and letters that identifies an individual mobile device. Advertisers can use a device ID to track and target users and their devices.
In-app GPS data can be accurate to within 10 to 100 meters, while geofencing allows advertisers to target a specific geographic area such as a point of interest (POI).
First-party demographic data collected in-app may include age, gender, language, and more.
Ad Prices Rise With Additional User Data
Apps that can collect first-party user data greatly profit when including it in the ad request — the more data they include in a single ad request, the more the advertiser will pay for the impression. In H1 2019 on the Smaato platform, the eCPM of an ad impression with both device ID and user age was 27% higher than one without any additional data. Add user gender and GPS location to that ad impression, and the eCPM increased an extra 117%.
The advanced targeting of the in-app advertising space puts the pressure on advertisers to build dynamic campaigns that can take advantage of these capabilities. By creating a full suite of dynamic creatives, for example, advertisers can match their ads to each unique audience segment and maximize users’ engagement with their ads. They can also analyze the success of each ad variant and optimize them accordingly.
According to a recent survey, nearly 60% of retailers in North America plan to invest in location-based marketing in 2019. This makes location-based advertising the leading emerging technology for retail investment — ahead of AI/machine learning and the Internet of Things (IoT).1 Furthermore, over 70% of US franchisees are already using location-based ads to advertise their businesses. The only advertising medium used more often is targeted social ads.2
Advertisers Use GPS to Target Travelers
The advertising vertical that invests the most in targeting via location data is retail. Location data is key for retailers with brick-and-mortar stores, as they can serve targeted ads to users within a certain proximity and segment audiences by frequency of visitation. According to 74% of marketers in North America, location data is a critical element of understanding why and how their customers interact with their business.3
Of course, not all apps and app categories pass ad requests with location data. On the Smaato platform, the travel app category had the highest share of ad spending going to impressions with GPS data (77%). Other top app categories included Home & Garden (68%) and Social & Dating (63%).
The apps in these categories are unique in that they often require users’ location to provide a specific in-app service. In the case of dating apps, for example, users provide their GPS location to connect with other app users in their vicinity. By passing this same location data in the ad request, the app receives higher eCPMs, and, as a result, a high share of ad spending for apps in this category is spent on impressions with location data.
Discover More In-App Advertising Trends
Our newly-released H1 2019 Global In-App Advertising Trends report looks at the effects of user data on ad prices as well as many other in-app programmatic advertising trends. Download the report for access key insights that will help improve your in-app advertising strategy in 2019 and beyond.
Sources: 1RIS News and IHL Group, January 2019 | 2BIA Advisory Services LLC, January 2019 | 3451 Research, May 20189