By 2022, the total ad spend for in-app advertising for app installs is projected to reach $118.4 billion. That’s up from $27.1 billion in 2017. It’s clear that in-app advertising budgets are growing exponentially every year. But are advertisers and publishers getting the ROI to make app ads worth the money?

The only way to know is to measure the performance of your app ads. And the best way to do that is to pick the key performance indicators (KPIs) that are meaningful to your business and monitor them.

In this post, we discuss six of the most important in-app advertising KPIs to watch. Read on for more information. And to get help maximizing your in-app ad revenue and performance, speak with the app monetization experts at Playwire.

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App Installs: The No. 1 App Ad KPI

Not all KPIs for app advertising performance are equal. In fact, app installs are far and away the most important KPI to monitor for app ads. 

Why? Because the largest block of ad dollars spent on in-app advertising focuses on convincing users to download another app. To that end, you have to measure how many app users are engaging with an ad and then downloading the app that the ad presented to them. 

Because this app advertising KPI is so important, let’s dive a little deeper into app installs and how to track them.

Coming Soon: A Big Change in App Install Monitoring

If you think you know something about how app installs are tracked as an ad KPI, you’re probably going to have to relearn everything at some point in the next few months. That’s because Apple announced that it was going to make the old way of tracking app installs nearly impossible with its iOS 14.5 update. That’s coming in spring of 2021, according to Apple.

This change is very similar to the impending demise of third-party cookies, but it’s not the same thing. To track app installs, you don’t use cookies. You use a device’s Identifier for Advertisers (IDFA). This is more granular than a cookie — it tracks a user’s specific device as they see an ad, leave the app and (hopefully) download the app that was advertised to them.

The IDFA is what’s changing drastically with the iOS 14.5 update. 

The New Way of Tracking App Installs

You can probably imagine that this impending change in app install tracking has app advertisers and publishers scrambling for alternatives. And while an alternative is shaping up, the IDFA isn’t going away completely. 

The big difference is that users will have to opt in to being tracked via an IDFA. Because most users will probably not opt in, industry leaders and app developers are researching how to increase opt-in rates. Post-iOS 14.5, opting in to IDFA tracking may increase in-app ad revenue exponentially.

As an alternative for using IDFA to target users and track app installs, Apple has  proposed a new method of tracking. It’s called SKAdNetwork. This is Apple’s privacy-first method of attributing ad clicks and impressions to app installs. While this new method isn’t fully tested, many industry experts believe it will work well.

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KPIs Unique to In-App Advertising

Now that we’ve covered the most important KPI for app ad performance, let’s take a look at some other ad KPIs that are unique to mobile apps.

Engagement with Rewarded Ads

In mobile apps, a rewarded ad asks a user to do something and rewards them for it. The task could be to watch an advertiser’s video, enter their email address or click through to a website, among other possibilities. Once the user has completed the action, they get a reward. This could be points, extra lives, in-app currency or any similar item that has value inside the app.

Rewarded ads are a great way to encourage users to fully engage with an ad. And that makes them more valuable to both advertisers and publishers. It’s also why you will want to track how much engagement your rewarded ads actually get.

Time to First In-App Purchase

Just like ads, most apps are selling something. But many apps don’t require purchase to install the app itself. Instead, they are selling something inside the app — often via in-app purchases. 

Time to first purchase is a KPI that measures how long it takes a user to buy something after downloading the app. Individual needs may vary, but typically, you want the time to first purchase to be short. In other words, you would rather have a user engage with an ad and download the advertised app two days after downloading the original app — not two years.

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Traditional Ad KPIs that Apply to Mobile Apps

Some advertising KPIs that got their start in digital advertising at large have found their way into in-app advertising, too. These traditional digital ad KPIs apply just as much to mobile apps as they do to any other type of digital publishing.

Viewability for In-App Ads

Viewability looks at whether app users are seeing ads and how long they are seeing them for. This KPI applies well to in-app banner ads as well as video ads. The same viewability rules for general digital advertising apply to in-app digital advertising: For example, for a display ad in an app to be considered “viewable” for a user, 50 percent of it has to be visible on the user’s screen for at least one second.

In-App Video Completion Rate

Video ads are big in mobile app advertising right now. That’s for good reason — video ads tend to provide better revenue opportunities. And apps present some great opportunities to use video, such as in interstitial ads and rewarded ads.

But how do you measure the performance of in-app video ads? The same way you measure the performance of video ads outside of apps — through the video completion rate. 

This metric tells you how many people watched the in-app video ad from start to finish. Typically, you want to know what percentage of people who start watching the video finish it. This helps you understand the level of engagement users had with the video ad.

Click-Through Rate

In the in-app advertising world, this metric might be more appropriately called “tap-through rate.” But the idea of click-through rate (CTR) in apps is the same as it is in other mediums — you want as many people as possible to click on the ad and go to the advertiser’s website.

There’s reason to believe that CTRs are actually higher in apps than they are in other types of content. But the only way to know how many people are clicking on in-app ads is to measure CTR as an app ad KPI.

In-App Advertising Made Easy

Understanding how in-app ads perform is essential for both publishers and advertisers. At Playwire, we work hard to understand the unique KPIs of all of our clients to ensure we deliver what we promise: high-performing in-app advertising.

To learn more about Playwire and discuss your unique app advertising needs with an expert, call us at 1-561-206-4621 or contact us online.

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