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Buying Paid Media on the Mobile Platform: An Introduction

April 15, 2013 - Advertising, Business, eCommerce, Mobile - , , , ,

One of the things we love about working on the mobile platform is how the user remains consistently ahead of the marketers trying to reach them, in terms of how they use the devices, what they choose to access and how they respond to advertising.

For the consumer, the idea of engaging a brand and receiving marketing messages over their mobile device is perfectly natural – this is just one more channel in their life, virtually all of which have commercial elements attached.

But for marketers, employing “traditional” paid display media on the mobile platform with the same level of commitment they devote to other digital channels, has been a long time coming. This may be due to a combination of not really understanding what consumers do and don’t want, confusion over the providers and systems in place to deliver ad messages, and possibly a reticence to repeat the display ad mistakes of Web 1.0.

Nevertheless, the need to include paid media on the mobile device in your marketing budget is, we believe, a given for most brands, and the sooner you get started, the sooner you can get good at it. Over the next three days, we’ll talk about some of the fundamentals of buying display on mobile, compare key players iAd and AdMob head-to-head, and recommend some best practices for moving your brand into this arena.

But before we can start looking at whom to spend your money with, there are a couple media definitions you need to keep in mind. As you probably already know, ad buys are generally negotiated on a CPM (Cost per Thousand: what you’re paying to simply have an ad show up on 1,000 screens) or CPC (Cost per Click: what you’re paying to have someone actually click on your ad) basis.

There is obviously going to be a relationship between these two numbers, and this relationship can vary wildly, based on your product, your ability to target your ad buy and the quality of your ad. A more interesting product, a buy that reaches more of the people who care about it (and fewer of the people you don’t), and a more compelling ad message lowers your cost per click, in relation to your CPM, and you start spending much less getting the people you care about to click on your ad.

You may pay for your ads by CPM or CPC, but you will judge efficiency on an eCPM basis. eCPM stands for Effective Cost per Thousand; it’s a measure of how much money you are actually making for each thousand ad impressions served. By looking at eCPM, you can start to compare costs and efficiencies across various media, so you know how a mobile campaign might perform versus Google AdSense or traditional DR.

The other thing to keep an eye on is Fill Rate. This shows how many ad requests actually return an ad to be displayed. Fill Rates are measured as a percentage. A perfect network would have a 100% fill rate: every time there’s a request, the network delivers an ad. The lower the fill rate, the less effective the network (you see this as a user when there’s a blank banner space on the page).

With all these definitions in mind, tomorrow we will look at a head-to-head comparison of iAd and AdMob and we’ll finish this series with some best practices for any brand looking to get into this space.

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