Performance Marketing- The New Mobile Industry Standard?


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Facebook has recently announced its intention to become a full-on performance ad platform- meaning, it will start targeting events that benefit the advertiser directly (download, in-app sales, etc.) When such an important player is discussing topic like this, it’s only natural that others will listen and that market trends will start shifting.

So why is it that most ad networks are still targeting banner clicks or, even worse, counting impressions? The short answer is; lack of targeting. It takes a sophisticated technology to get the right user to click a banner and then take action and purchase a product/ service. The points of failure all through this process are endless.

The easy solution for most ad networks offering a Cost-Per-Click model is to optimize banners. The math is easy, make the banner attractive and get the user to click it. This is precisely the point where most ad networks get paid for their efforts. But there is still a long way to go from a banner to an actual conversion.

A performance model requires a much deeper data gathering, which is simply not scalable if conducted manually. On one hand, you need full data about the end-user; who is he? What are his habits? What makes him tick? On the other hand, you need to match this specific user with an ad offering attractive enough that he could by no means resist, at very specific point- in- time. Mobile is the type of personalized device that can bridge this gap. Its usage is so personal and so frequent that, for the first time in history, marketers are gaining a close insight into what users REALLY do want, while they use it, which allows for a direct interaction which in highly individualized environment

In order to keep the ad- serving process relevant, timing is of an essence, the manual process is no longer an option.  An ad network does not have thousands of employees analyzing millions of data points.  A new technique called Real Time Performance is able to solve this problem.  It’s about working with direct publishers, harvesting user data and serving those specific users with individual offers, customized to them, all based on their past purchases and mobile behavioral history.  Ad networks applying this approach are able to achieve a substantially higher click-rate which translates into a significant hike in conversion-rates and an improved bottom-line for advertisers.

CPA is definitely the most cost-effective model an advertiser can choose. Hollywood is already using mobile to drive ticket sales. The auto industry sets test drives via mobile devices and even sells cars using apps. Retailers are making about 70% of their digital sales via tablets. Now, with Facebook joining the party, could this be the demise of banner-click and impression-counting models?

It’s only a matter of time until mobile ad networks are forced to switch their mobile marketing approach and develop the technology to support performance marketing; According to Gartner’s recent report, mobile ad network providers will need to strengthen their performance-based models, offering targeted mobile ad campaigns with detailed analytics to guarantee their own future success.

The reason is simple–advertisers are demanding ACTION.

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