Author: John Koetsier

John Koetsier is a journalist and analyst. He's a senior contributor at Forbes and hosts our Growth Masterminds podcast as well as the TechFirst podcast. At Singular, he serves as VP, Insights.

Privacy Sandbox on Android and Singular: how it will all work (part 1)

How do you break more while being less disruptive? When we recently hosted a webinar on Privacy Sandbox on Android, InMobi’s Sergio Serra said that while Privacy Sandbox breaks more than SKAdNetwork, it will be less disruptive. 

Sure, that might sound illogical, but part of the reason for it can be found in the chat I recently had with two software architects at Singular on the Growth Masterminds podcast.

Privacy Sandbox breaks more

Essentially, Privacy Sandbox will break more in the industry because in a sense it’s a full-scope advertising suite, with capability for targeting, for attribution and measurement, and for retargeting. That’s a 360-degree view from an advertiser wanting to place an ad (Topics API), to being able to measure the effectiveness of that ad in what people do after experiencing it (Attribution Reporting API), to being able to create audiences and retarget former customers, users, or players (Protected Audiences API, formerly known as Fledge). 

In contrast of course, Apple’s SKAdNetwork has no targeting mechanism, no notion of audiences, and no ability to retarget: it’s a privacy framework for adtech, not an adtech framework for privacy.

So naturally, Privacy Sandbox is more complicated. It creates new solutions for more parts of the advertising ecosystem, which is exactdly why it’s also going to break more existing tech.

“Integrating with Android Privacy Sandbox is more complicated than integrating with SKAdNetwork,” says Singular software architect Ron Shub.

“It is a really complex solution for marketing and performance measurement,” agrees Singular chief software architect Yuval Carmel.

But Privacy Sandbox is also less disruptive

But that’s not the whole story. It’s also less disruptive. 

And there’s a very simple reason why: adtech companies are going to build technology to manage all the aspects of targeting and audiences and measurement that Privacy Sandbox is breaking. And marketers will be able to use those solutions pretty much just like they’re using existing solutions.

With a few caveats, of course. 

“Luckily for our customers, of course, we plan to be there for them and handle the heavy lifting, of course,” says Yuval Carmel. “We’ll guide them quite a lot.” 

Of course it’s not just Singular. 

Ad networks, demand-side platforms, exchanges, and supply-side platforms are all building targeting and audiences capabilities based on Topics API and Protected Audiences API, plus all the other privacy-safe targeting and retargeting criteria they can still utilize after the eventual deprecation of the Google Ad ID (GAID). That includes context, time, type of supply, coarse location, and dozens of other factors that DSPs and other adtech solution providers use for identifier-free mobile traffic.

The plan and the hope — to be validated by actual experience when Google eventually turns on Privacy Sandbox at scale — is that marketers will be able to do their jobs and the adtech ecosystem will manage everything else.

We’ll see how well that goes, of course, but most in the mobile performance marketing ecosystem seem to feel that the time and preparation Google is investing into Privacy Sandbox will result in much less marketing signal degradation than we saw on iOS with the introduction of SKAN 3.

The Google referrer

One big helper in that regard: the Google referrer

Just like on the web where a website receives a referrer when a potential customer clicks on a link telling the website where that visitor is coming from, the Google referrer in mobile app installs provides insight into where an ad was clicked, providing a direct-line last-click measurement solution for advertisers. 

(Note: this wasn’t 100% clear at the time of our conversation, as you might note in the video or podcast transcript below, but it is now.)

“The Google Play install referrer … is probably the best and most accurate mechanism to attribute and match ad clicks to app installs on Android devices,” says Yuval Carmel. “As long as it’s available … most marketing attribution and our attribution as well will work with this reliable and robust solution. It’s the best solution. You can basically pass things to the Google Play Store and you get it as an intent from them in the MMP SDK, in our SDK. So it works the best and you can reliably attribute users that way.”

Referrer data is critical, but it’s not the only data that marketers will be getting from Privacy Sandbox. 

Attribution Reporting API in Privacy Sandbox

The Attribution Reporting API in Privacy Sandbox on Android supports 2 kinds of reports: 

  1. Event-level data
    1. Super detailed upper-funnel breakdowns
    2. Super limited lower-funnel data
  2. Aggregated data
    1. Selected upper funnel breakdowns
    2. More detailed lower-funnel data

(See more about these reports in Singular CEO Gadi Eliashiv’s Attribution API breakdown.)

The event-level data for conversions or engagement is granular but super limited: 1 bit for view-through attribution and 3 bits of data for click-through. One bit will pretty much tell you that an event happened or didn’t: someone registered or didn’t, someone bought or didn’t. More challenging: you have to pick the one event you care about most and won’t get data about anything else.

The upper funnel insights from event-level data, on the other hand, are super-detailed.

Pretty much the opposite is true for the aggregated data, where you only get a few upper funnel breakdowns, but you get more detailed conversion data. Since the data is aggregated — and there’s noise added — privacy is preserved.

Each will have its own place.

“Event level reports are good for optimization; the aggregatable reports are very good for reporting for a campaign performance measurement,” Shub says. “And that’s why here in Singular we really focus on that because it’s going to give the most accurate data with less noise and much more flexibility.”

So how does the flow work in Privacy Sandbox?

At a very simplified level, here’s what a real-world scenario looks like under Privacy Sandbox for Android:

  1. User clicks on an ad
  2. Ad network registers what Google calls a source for that click, which encodes some data about where the click was, what campaign the ad is from, creative information, and more.
  3. User installs the app
  4. App publisher registers conversion events, which Google is calling triggers. 
  5. A job schedule runs on the user’s device in Privacy Sandbox, creating encrypted data about those triggers.
  6. When the app publisher decides they have enough data, that encrypted data goes to an attribution aggregation service.
  7. The attribution aggregation services decrypts the data, summarizes it to a report, and adds noise.
  8. A marketer gets a summary report and has to decode the dimensions that were encoded when registering sources and triggers.

It all sounds very complicated, and that’s probably because it is. But the good news is that Singular — and other adtech vendors — are doing the heavy lifting.

“We will do everything for the UA managers,” says Shub. “They don’t even need to know everything that is going on under the hood. I’m sure they want to know how confident we are in the data, but all this infrastructure is something that we’re going to support together with ad networks. And it’s our job to prepare this infrastructure.”

There’s more, of course, including details on the data you get back and how you use it, and what to set up in your sources and triggers.

That will all have to wait for the second part of our interview with Yuval Carmel and Ron Shub, coming soon.

Subscribe to Growth Masterminds

Subscribe to our YouTube channel with a single click.

Or pick your favorite audio podcasting platform on the podcast home page.

And … a full transcript: Singular and Privacy Sandbox on Android

Note: this is AI-generated and lightly edited. It may contain errors. Check the actual audio or video if in doubt.

John Koetsier

Privacy Sandbox on Android is coming soon and it’s time to embrace the suck. 

Hello and welcome to Growth Masterminds. My name is John Koetsier. I kind of love the phrase embrace the suck. It’s something I’ve said to my kids a lot when they’re doing something that’s hard. It’s something I say to myself when I’m doing something that’s hard but worthwhile. It’s about leaning in to hard stuff so you can eventually make it easy.

We saw that happening on iOS with ATT and SKAN marketers who leaned in and got it, got better at it. They did better at it and they achieved better results. It’s likely the same thing is going to happen with Privacy Sandbox and Android. It’s not gonna be easy, but it will happen. It’s coming. The GAID is going away and it will be worthwhile to lean in. So to start embracing the sock, we’re chatting today with two people. 

Ron Chubb is a software architect at Singular and Yuval Carmel is the chief architect at Singular. Welcome Ron, welcome Yuval.

Ron Shub

Hey, great to be here.

Yuval Carmel

Hey.

John Koetsier

Awesome, super pumped to have you. Hey, we’re diving into Privacy Sandbox for one of the first times, I think, on Growth Masterminds. We’ve talked about it a bunch on the blog. We’re gonna do more on that as well. But as everybody knows, Privacy Sandbox is an attempt from Google to do three things, right? 

Show relevant content and ads, measure ad effectiveness, and limit tracking. 

Yuval, maybe kick us off here. What’s your overall impression of Privacy Sandbox on Android?

Yuval Carmel

So yeah, John, I think Google are investing a lot of time in engineering this solution. You can see it quite a bit. They’re building a privacy-oriented solution, which will require UA marketers to define properly what they want to track and in which morality in advance. 

So the solution basically migrates the attribution logic to the device. Like we’re moving in to do more work on the client itself. 

And then basically, it requires more complex management of the triggers and the conversions you want to track. So the marketing data won’t be available anymore with PII attached to it as we are used to it, like user-level data. Things are going to be different a little bit and probably reporting and like the data reporting is going to be more aggregated. We’re going to see more aggregated reports, people using more aggregated data and less relying on user-level data.

So, and the idea here is obviously to, that it would be hard to track back single users behavior and usage of specific apps. One thing to mention is that the sandbox team in Google are working closely with us and other partners to make sure the solution is well scrutinized and tested, like well architected as well, which is pretty cool. And it’s a great approach.

If you take the opposite, you mentioned embrace the suck. So embrace the suck is like a military term, right? And because you have to, there’s no other way. You have to embrace the suck. And with previous changes in the privacy landscape with other companies, you really had to embrace the suck. You couldn’t do anything, you couldn’t talk to anyone. There was no work relations over there.

And here, basically, we see Google working with the partners and trying to make sure the PSA will be easier to embrace. Let’s say that.

John Koetsier

Love it, love it, love it. Ron, if you look at Privacy Sandbox and you look at, you know, SKAN on iOS, compare and contrast them for us.

Ron Shub

So yeah, Google are trying to solve the same problem, right? And doing a privacy enhancing solution that limits user level tracking. But I can say that the approach is super different between a SKAdNetwork and Android Privacy Sandbox, for example. 

And firstly, taking ATT and just to recap ATT is App Tracking Transparency first introduced in iOS 14.5, the change the behavior from opting out to opt in. So when you install an app, you get a pop-up, and you need to say if you allow tracking. And then most people say no. And then you don’t have we or the MMPs, they don’t have the IDFA anymore. The IDFA is reset, and it makes it much harder to track marketing data. 

So Google’s approach is a bit different. They say we first want to have an alternative. We want to have the Privacy Sandbox and APIs. And only later, perhaps, we’ll talk about deprecating the Google Advertising ID. So we think the Google Advertising ID is here to stay for now, and there’s no particular plans to deprecate it [immediately].

And when they will deprecate it, they will give a substantial notice before. And when talking about SKAdNetwork compared to Google attribution, which is the Attribution Reporting API, then they’re both, again, trying to solve the same thing. But the approaches are, again, super, super different. So a few teasers, documentation-wise, Google supplies tons of documentations and repositories. They basically open sourced everything to us. And it’s really helpful in understanding how the infrastructure will look, what we can do with it, how we can deal with noise, et cetera, et cetera. And a few specific teasers are, for example, dimensions.

In SKAdNetwork, you get a SKAN campaign ID, which is a number between 0 and 99, just 100 options. Now in SKAdNetwork 4.0, you get a bit more options with Source ID, but it’s really standardized and it’s quite capped. 

Google supplies 128 bits, which is much, much, much bigger. It gives you a lot of places to encode your dimensions. Another small teaser is … Apple limited the way that you, when you get the conversion, the conversion window is practically limited. So you can only track after installs for a few days. 

And Google doesn’t have this limit at all. So you can get lots of aggregatable reports and raw data. And you decide when you want to get the summary report. So you can also track a month after the install happened. And it really attests to the level of freedom that Google provides. But with that comes also complexity. So integrating with Android Privacy Sandbox is more complicated than integrating with SKAdNetwork.

John Koetsier

That is an interesting phrase and that perhaps will not come to many marketers as happy news because most have said that SKAN is really challenging and that was already in 3 and 4 is more challenging with more options and more post-bacs and more delays and all those sorts of things. Now there’s some testing happening right now, Privacy Sandboxes and data. You’ve been working with a developer preview. 

What are some of the biggest learnings and takeaways from working with the preview?

Ron Shub

Yeah, so we’ve been very impressed with Google’s efforts, like Yuval mentioned. Bunch of documentations and repositories that helped us go through and understand what’s going to be introduced really soon. Our current objective is to complete an end-to-end testing of the Attribution Reporting API, which means from registering a click through querying the aggregation service and getting back the decoded and decrypted summary report.

There are some hurdles on the way. It doesn’t go very smoothly, but Google has been super attentive. 

There’s currently another issue that we’re facing, and we think we’re on the verge of solving it. And we’re really excited to be able to finish the end-to-end test and be practically ready for the Privacy Sandbox. So yeah, Google is super responsive in answering questions and helping us out and they seem to be investing tons of resources and we enjoy working together.

John Koetsier

Super interesting. You’re working on it now. As we’re recording, it’s May 1. This will probably be released in two weeks or so. We have, I think, till the end of the year before the GAID might go away and other things will happen. But yeah, there’s going to be some time there. 

So big picture, if we look at Privacy Sandbox, there’s three privacy-preserving APIs, as Google calls them across web and Android, right? 

There’s Topics API, which should allow for much better targeting than we currently have on iOS, but I still think the granularity is gonna be a challenge. There’s what they used to call Fledge API, which is now Protected Audiences API, that should allow retargeting and maybe a couple other use cases. But you’re most concerned, of course, with the Attribution Reporting API. 

I don’t know why, there’s some odd reason about that, but that’s where you’re spending most of your time. Your thoughts, how good is it?

Yuval Carmel

Yeah, so that’s a great question. As you mentioned, it looks like Google is basically trying to find a solution for every reason you use Google Advertising ID, right? So they get the Topics API for you for retargeting purposes and the Fledge audiences, Protected API for audiences. And then Attribution Reporting API. 

So yeah, what’s my thoughts regarding it and how good is it?

The attribution reporting Privacy Sandbox is going to change the way some of us are used to see marketing data. So we have a lot of customers that are still used to seeing user-level data and marketing data attached to see specific users, to their PII even. So although we have SKAN and the changes in the industry, many people just, like many customers, we heard in the industry basically stopped marketing in iOS and just heavily based themselves on Android.

And now they’ll have the same issue in Android as well. And user-level data is going to be super limited. 

You have like three bits, as Ron mentioned, or we’d mention in one of the next questions maybe. But you have like just three bits to collect information regarding an event. But of course, the attribution aggregated reporting can be utilized for the marketing purposes, if you understand the requirements and how to execute it. 

So is it good? 

It’s a good solution for privacy, first and foremost. It’s a great solution for privacy because everything will be more private. Your PII is more protected. Your information is more protected. Your behavior is less easily measured and tracked. But it is a really complex solution for marketing and performance measurement. Luckily for our customers, of course, we plan to be there for them and handle the heavy lifting, of course, in the beginning, and we’ll guide them quite a lot. But what’s going to be hard? So it’s going to be hard to understand how to define your aggregation keys or basically dimensions or the granularity in which you want to measure and track your conversions.

It’s going to be a little bit complex to understand how to manage the conversion events themselves. And we will talk about the meat more later on, but the idea here is that the solution is really generic and it gives you the freedom to figure out the best measurement, that method for you, like whatever you need, you can basically implement here, which is a great advantage, but it will be quite complex, I think, for advertisers to manage by themselves.

John Koetsier 

Super, super interesting. Just to take a half a step back for a second and think about the landscape of mobile and mobile apps and how it’s changing, changed over the past year and a half and over the next year. 

It’ll be fascinating to look back at this point in history and say, oh, that’s why apps do this now, because the conversion models for advertisers need to change, so the product needed to. It’ll be interesting to see. Ron, let’s turn to you.

I always ask when I talk to people I’m talking about SKAN, you know, what their estimate is for the level of drop of ad efficiency from IDFA to SKAN? 

And I’m gonna ask you that in terms of Android. It’s really early, of course, you’re just starting to work with this. It’s not out in the wild. It’s not being used by very many people at all, just tested. 

Can you guesstimate how much ad efficiency might drop as we move from GAID to Android Privacy Sandbox?

Yuval Carmel

I’ll take this one. So I think the GAID and the ad efficiency drop, or basically the problem here is measurement, right? And the measurement efficiency is going to drop on GAID. And once the measurement isn’t as accurate and possible, of course, the ad efficiency will drop as well.

So the thing is that for click-through attributions, we have the Google Play install referrer as well. I think most of our Android-based attributions are based on Google Play install referrer, which is probably the best and most accurate mechanism to attribute and match ad clicks to app installs in Android devices. 

So as long as it’s available, the Google Play install referrer … I believe most marketing attribution and our attribution as well will work with this reliable and robust solution. It’s the best solution. You can basically pass things to the Google Play Store and you get it as an intent from them in the MMP SDK, in our SDK. So it works the best and you can reliably attribute users that way.

So if Google will deprecate the Google Advertising ID but won’t deprecate the Google Play install refer. 

I think for click through attribution, we still have a really robust and accurate method to calculate attributions, the same as we do today. Great question to Google, which probably none of them really have a definitive answer, is what will happen with Google Play install refer. We’re still waiting on an answer and I think some of them still waiting on an answer. So no one really knows what’s the plan over there. 

Regarding view through attribution, it’s a bit different. You don’t have the Google Play install refer over there. We’re currently relying on getting impressions reporting from the networks themselves, from the partners themselves. Note, I’m not talking about self-attributing ones like Google Ads and Facebook.

I think about the other guys out there that are basically sending the impressions to us and then we’re the one matching using the Google Advertising ID with the clicks that we also get. And in that aspect, I think that the Google Advertising ID deprecation will affect the views to attribution quite heavily. And I think we see that the sandbox solution will probably be used first and foremost for view through attribution and not for click-through as long as we have the referrer solution.

John Koetsier

Super interesting. So we’ll see if we continue to have that. We saw that fingerprinting became an issue on iOS. And Apple addressed it and said, hey, that is measurement. That is tracking. That is not allowed. What do you see happening with fingerprinting on Android as Privacy Sandbox comes in?

Ron Shub

Right, so we assume the same will probably happen. I mean, people will still continue to use fingerprinting as long as they can and feel comfortable doing it. But as Apple did, I’m assuming that also one day in the future, Google will decide that they want to make fingerprinting harder and even not possible, in some cases. And will not really enable it anymore. And when that happens, then people, we need to find other solutions. But Google did mention that they will give a substantial heads up before that. So we’re not thinking it’s going to happen any time soon. And for now, fingerprinting is still in play.

John Koetsier 

Talk about event level reports, and how they differ from aggregated reports?

Ron Shub

Right, so Google’s in-attribution reporting API supports two types of reports. 

Event-level reports are more suited for optimization. So they can be used, for example, for training data for machine learning models, for example, when you want to optimize ad placements. But the issue with event-level reports is that the conversion data is super coarse. You don’t get almost any data about what happened after the install. So practically for view through attribution, you get one bit. And for click through attribution, you get three bits. So that’s practically, you can’t encode anything almost there.

John Koetsier

Go into detail here … one bit. What can you do in one bit? Is that like on or off? Is that one bit? It’s binary?

Ron Shub

Right.

You can practically say, you can say, did that happen or did that not happen? So you can say add to cart happened. So that’s pretty much it. You have to choose one event and focus on it and just say if it happened or didn’t happen, but that’s not much information in aggregated reports, you get a lot of freedom in the conversion data … the same 128 bits we mentioned before, that you can split between the registering of the source of the click with the view and registering triggers. So you can register many metrics, events or revenue, and really measure what happened, what the journey that the device, the user did in the device after he installed the app. So again, event level reports are good for optimization, aggregatable reports are very good for reporting for a campaign performance measurement. And that’s why here in Singular we really focus on that because it’s going to give the most accurate data with less noise and much more flexibility.

John Koetsier

So there’s some noise added. Walk us through the flow. Give us a sense of what happens when you’re placing an ad. Somebody clicks on it, they install, they do something. How does that flow work through all of Privacy Sandbox?

Ron Shub

Yeah, so that’s a question that there’s no really short answer for, but I will try to summarize it as much as possible. So the first steps are on the device. So a user sees an ad, and then you register a source in Google. And you define already the dimensions that you want to measure. And then the user.

John Koetsier

And registering a source is simply telling Google where the ad was placed, what app it was in or what website it was in, correct?

Ron Shub

Exactly. You can put a bunch of things in the aggregation key, which practically means the campaign, like you said, what country, whatever you decide to encode into the dimensions there. But yes, you define the dimension on that, on that step. And that’s the registered source. It’s in the publisher app. 

After the user installs the app, once they do events that you want to measure or revenue you’ll register it as triggers. So you can register multiple triggers. Exactly. So you can measure multiple triggers. There is a limitation here that we’re going to mention soon enough. 

But triggers are practically only the events and metrics that you want to measure. 

And after you register the triggers, some time later, there’s like a job schedule that runs on the device. And once it runs, then you get what’s called aggregated data reports, which are practically raw encrypted data. You can’t do anything with it so far. So you have to keep it in your database and store it for a while until you get enough aggregated reports, enough raw data. 

And once you do, then you take a batch of aggregated raw reports and you send them to the attribution aggregation service. What the aggregation service does for you is decrypt the data, summarize it to a report. You can think about it as a table and add noise to each row of that table. So each dimension’s permutations, for example, campaign A from country US will contain multiple installs.

And to that, and multiple revenue and multiple events, and to that, Google will add noise. So they say exactly what the distribution of the noise is. And you can already start thinking about, how do I encode the right numbers in order to make the noise not very harmful? So signal-to-noise ratio is here, right? So you want to have a much higher signal than the noise.

So once you get back from the aggregation service, a summary report, you have to decode the dimensions that you encoded when you registered the source and the trigger. And you need to try, using data science algorithms and whatnot, you need to try to remove the noise and to give the actual numbers. And the way we did that with a scale network, and I assume we’ll do the same here, is give you the approximation of a number and a confidence interval that really says how I’m sure we are in the number that we give you. And that depends on the volume of the installs you had in that period of time.

John Koetsier

And so Ron, there was a lot of you need to and you’ll get and other stuff like that. And what you’re saying and you’re getting data that you can’t understand and it has to go somewhere that’s not you. And then you get it back and there’s some noise added to it before you get it back. 

Now, please tell me that all the you here is actually Singular getting this data you can’t decrypt and then sending it someplace where it can get decrypted where it gets its noise added and then you get back out something that you can actually read is that as a marketer the mark the you marketer doesn’t have to do all that stuff is that correct

Ron Shub 

That’s absolutely correct. 

So we will try to do, we will do everything for the UA managers. They don’t even need to know everything that is going on under the hood. I’m sure they want to know how confident we are in the data, but all this infrastructure is something that we’re going to support together with ad networks. And, it’s our job to prepare this infrastructure …

John Koetsier

That’s a promise. You heard it here first.

Ron Shub 

… which is a really cool infrastructure, by the way. But UA managers don’t have to worry about it at all. They have to worry about what metrics and events they want to measure and decide which ones are the most prioritized because it’s hard decisions like we have in the SCAD network. We can’t get all the events and revenue as we used to.

John Koetsier

Excellent. And you know what? You just ended our session here because there’s so much more that we do need to talk about. We need to talk about, wow, SDK runtime. 

We need to talk about the data that you’ve been talking about, the flow, what’ll come back, you know, all of that stuff, the modeling that you’ll do. We’ll have to talk about, you know, web to app, what the impact we think will be here. You’ve all, you’ve got a lot more to ask you and Ron, we’ve got a lot more to ask you, but this just became part A and they’re going to have to do part B a couple of weeks down the road or something like that. 

‘Cause it’s like 30 minutes now and you know, probably a little long for this particular one and also you guys have lives you’ve got to, you know, get back to and I’ve got a meeting that I’m already late for as well, but thank you so much for this time. I really do appreciate that. We’ll set something up. 

You have to talk to me again. That’s the bad news. But the good news is you get the rest of your evening off …

App Store Fraud: Apple stopped $2 billion in fraud, killed 282 million accounts, rejected 1.7 million apps

Apple says it deleted 282 million fraudulent customer accounts, 428,000 fraudulent developer accounts, and blocked more than $2 billion in fraudulent transactions in 2022. That’s a new record: up from the $1.5 billion in app store fraud Apple says it blocked in 2021.

App store fraud can take a lot of forms. 

Fake apps from scammy developers can have fake users who generate fake activity to earn money from ad placements. Other fake apps might have more nefarious purposes, such as stealing people’s personal information. Most app store fraud that Apple’s referring to here, however, is in-app purchase fraud, which can take the form of using stolen credit cards to make fraudulent purchases. Alternatively, bad actor apps can employ deceptive tactics to trick users into “buying” items they never intended to, including expensive subscriptions that keep charging credit cards every month.

Apple says that for payment and credit card fraud alone, it blocked:

  • 3.9 million stolen credit cards
  • 714,000 accounts
  • $2.1 billion in potentially fraudulent transactions

Legitimate app developers and publishers, of course, care deeply that the App Store — and Google Play on the Android side — is seen as a safe place to buy things. They also care that criminals don’t use their apps for money laundering.

(Think building up a massively powerful Clash of Clans account through IAPs, then selling the account. Or booking fake stays at fake Airbnb homes.)

App Store fraud: 1.7 million app submissions rejected

In the mobile community it’s common to hear about legitimate app publishers who have trouble getting their apps published, and there are real concerns here. But we don’t often hear about the positive side of the App Store submission process, which is exactly what keeps a massive amount of fraud and danger off people’s iPhones.

Apple says its teams review 100,000 app submissions a week, which means much of the review must be automated. In 2022, 1.7 million apps were rejected.

Some of there were legitimately dangerous:

“In more than one case this year, App Review caught apps using malicious code with the potential to steal users’ credentials from third-party services,” Apple says. “In other instances, the App Review team identified several apps that disguised themselves as innocuous financial management platforms but had the capability to morph into another app.”

Apple removed almost 24,000 apps for bait-and-switch tactics last year. 

Another 153,000 were copycat or spam apps, and another 29,000 contained hidden or undocumented features, Apple says. Once one app from a developer account is found to be fraudulent, all apps from that account are removed, and Apple says it terminated 428,000 developer apps in 2022.

Interestingly, Apple also says it also blocked apps from third-party app stores:

“In 2022, Apple protected users from nearly 57,000 untrustworthy apps from illegitimate storefronts, which do not have the same built-in privacy and security protections as the App Store. These unauthorized marketplaces distribute harmful software that can imitate popular apps or alter them without the consent of their developers.”

Another avenue fraudsters use is the Apple Developer Enterprise Program, designed so that companies and organizations can build and distribute their own apps internally without having to use the App Store. Apple blocked 3.9 million attempts to install or launch apps using this vector in the last 30 days alone, the company says.

Multiply that over the course of an entire year, and that’s almost 50 million attempted app installs.

1 billion ratings and reviews checked

Apple also says it reviewed more than 1 billion ratings and reviews for potential fraud, and deleted more than 147 million.

Review fraud can punish or elevate an app, if competitors review-bomb a game with negative reviews, for instance, or publishers pay for fake positive reviews for their own apps.

App Store and Google Play in 2025

As we move into a changing reality for app distribution that the EU’s Digital Markets Act will likely force, it’s important to remember that along with the good — more freedom for app publishers and a greater ability to monetize how and where they wish — there will inevitably come some bad.

Apple’s job is to convince consumers in the coming years that sticking to the App Store for all their apps and all their in-app purchases is the safest way for them to avoid becoming victims of fraud, and data dumps on fraudulent activities like this is one way it is doing so. 

Just because that’s in Apple’s financial interest — of course — does not mean that they’re wrong.

Which means that as app developers and marketers acquire the ability to take different paths to monetize, they’ll have to carefully judge consumer sentiment before making significant moves around decoupling from Apple’s distribution and payment infrastructure. It’s entirely possible that app publishers could earn less from their apps despite taking a larger share of user/player/customer payments than the traditional 70/30 App Store model.

And if third-party app stores and Play stores proliferate, there’s additional opportunity for scammers to reverse-engineer apps, copycat them, and profit.

The mobile ecosystem is going to get more complex: that’s the one certainty we can know for sure.

Be ready for identifier-free mobile advertising this year: InMobi’s Sara Camden

How do demand-side platforms change in the privacy era? And, when will you need to be ready for identifier-free mobile advertising?

Traditionally, demand-side platforms matched up ad placements across multiple publishers with specific audience segments, with marketers supplying targeting criteria and DSPs matching those requirements to groups of people via device-based ad identifiers.

Take away the IDFA and (soon) the GAID, and that’s a lot harder. So is campaign optimization, targeting, attribution, and more.

So how does it work now?

DSPs and contextual data for identifier-free mobile advertising

Context now matters more than ever. But not just the kind of context that comes to mind immediately.

“Those individual identifiers that we all have become reliant on are a thing of the past now,” says InMobi head of product marketing Sara Camden. “So it’s really looking at privacy-safe types of signals that have to do with the user’s device, some temporal things, like the time of day or the day of week, the type of supply that you’re targeting, be it the ad exchange, a specific publisher, or the type of publisher from a contextual standpoint … all of those signals have to come together and we have to do a lot more with a lot less.”

Less device data.

Less data about people.

Greater reliance on contextual data, including rough location.

Predictable postbacks in SKAN 4

One of the biggest challenges, Camden says, is not so much the loss of targeting efficiency — although that stings — but the lack of immediate feedback or at least predictable windows for postbacks. That’s one of the things she likes about SKAN 4.

“I think anyone who experienced SKAN 3 has probably cursed the pesky conversion window that kept resetting every 24 hours when a new event occurred,” she told me on a recent Growth Masterminds podcast. “So now we have these 3 fixed windows of the first 48 hours post-install, then days 3 to 7, and then days 8 to 35. And each of those comes with a postback, versus just a single postback before.”

(Of course, you can lock conversions and get postbacks earlier, as you can see in our SKAN 4 transition guide … but that comes at a significant cost in terms of estimated cohort accuracy.)

One of the impacts of SKAN 4 is a resumption of interest in advertisers, says Camden: many who had been completely anti-SKAdNetwork and perhaps even diverted ad dollars away from iOS, as a result, have been attracted back.

While SKAN 4 is still pretty far away from prime time in terms of widespread adoption and usability, InMobi is seeing 20% of bid requests that are SKAN 4 compatible as of April. SKAN 4 postbacks are still few and far between, but clearly there’s a significant uptick in ecosystem adoption that will make SKAN 4 the default attribution protocol for most at some point this year.

Crowd anonymity is better than privacy thresholds

Crowd anonymity seems much more advertiser-friendly than SKAN 3’s privacy thresholds, too.

“Early results that we’re seeing is that now you get some level of conversion insights at around five installs per day per campaign, whereas it was about 15 in the earlier version,” says Camden. “So, you know, that certainly is a marked improvement over the earlier iterations.”

That’s good news for marketers who kept seeing null values in SKAN 3 postbacks.

Of course, more installs per campaign will, however, get you better results: fine conversion values and potentially full source identifiers. So it’s still important to put more wood behind your campaign arrows.

Ready or not, GAID is going away

Camden thinks Google’s record of kicking the can down the calendar on the third-party cookie deprecation is not relevant to the GAID, which she thinks will be on track to be gone by the end of the year.

Part of that is due, perhaps, to the more consolidated mobile space, where Google holds more power over the Android ecosystem than it does over the web environment.

“By the end of this year, I think marketers need to be ready to predominantly be targeting their campaigns and doing attribution without relying on IDs,” she says. “You mentioned how the can keeps getting kicked down the road when it comes to deprecating third-party cookies. I’ve not been seeing that same friction when it comes to the mobile identifiers. I think because they’ve gotten that practice with iOS and App Tracking Transparency that they’re more prepared … so I’m not seeing the type of delays that we’ve seen with cookie deprecation.”

That might be a scary thought to some — and identifier-free mobile advertising — and it’s a good reason to get up to speed with Privacy Sandbox on Android.

Much more in the full podcast …

Watch the full video above, and subscribe to the Growth Masterminds podcast on your favorite podcasting platform. There’s much more there, including Camdens’ take on mashing up Privacy Sandbox on Android and Apple’s SKAdNetwork to make the ultimate solution.

Here’s a full transcript of our conversation …

Note, it’s AI-generated and lightly edited, so it may not be 100% correct.

DSPs in the privacy era and identifier-free mobile advertising: what will change?

John Koetsier:

How do demand side platforms change in the privacy era? 

Hello and welcome to Grow Masterminds. My name is John Koetsier. 

Back in the dim mists of time, like three years ago, DSPs were pretty straightforward businesses, right? By which I mean, they were horrifically complicated, incredibly challenging, but at a conceptual level, it was relatively simple. We had a massive demand for ad placements. We matched it up with devices whose IDFAs or GAIDs that indicate compatibility or interest or opportunity. 

Since SKAdNetwork, however, and soon Privacy Sandbox, it’s gotten more difficult. There’s less data, there’s less history, there are more challenges finding great supply for a DSP’s demand. So how do DSPs evolve in the era of privacy? To chat about this, we’re joined with a longtime adtech and martech expert. She’s been with Equifax, with Epsilon, she’s now head of product marketing at InMobi: Sarah Camden. 

Welcome, Sarah.

Sara Camden:

Thank you. It’s great to be here, John.

John Koetsier:

It’s great to have you. Like I said in our pre-chat, I feel like I’ve seen your name everywhere. I’ve heard your name in lots of places. This is the first time face-to-face. Thanks for taking the time.

Sara Camden:

Yeah, I appreciate the opportunity. It’s a fun subject to talk about, right?

John Koetsier:

Absolutely. Everything in ad tech is fun. Super fun. Barrel of laughs. Let’s start here: level set. What the heck does a DSP do?

Sara Camden:

So DSPs are really there to make lives easier for marketers and ad buyers, you know, and really kind of automate that process. You know, I actually got my start in adtech right around the birth of DSPs when contextual type of targeting was still sort of the primary mechanism. But, you know, marketers realized with all of these devices that people had, they would love to get more granular and individually target people. 

So hence the birth of DSPs that can take that data and really personalize as well as measure campaigns at that individual level, which we all have loved. Obviously, things have changed quite a bit, and it’s a little bit of: everything old is new again in the current state of DSPs today.

John Koetsier:

Back to the future or back to the past, one of those two. Let’s talk about a DSP under SKAdNetwork. 

How’s that work? What are you doing? What signals are you using? How are you finding the right placements?

Sara Camden:

That’s a great question. You know, those individual identifiers that we all have become reliant on are a thing of the past now. So it’s really looking at privacy-safe type of signals that have to do with the user’s device, some temporal things, like the time of day or the day of week, the type of supply that you’re targeting, be it the ad exchange, a specific publisher, or the type of publisher from a contextual standpoint. 

So is it sports? Is it news? Is it gaming? All of those signals kind of have to come together and we have to do a lot more with a lot less.

John Koetsier:

Interesting. Are there some geo signals as well, roughly?

Sara Camden:

Yeah, yeah, there are some rough GPS signals, like DMA, or just regional type things, you know, those are things that we tend to use at least at InMobi.

John Koetsier:

So that’s a massive change. What kind of level of impairment, let’s just talk SKAN 3 right now, maybe because that’s what’s dominant right there. What kind of level of impairment have you seen since losing the IDFA? 

Can you estimate a percentage of efficiency loss in targeting?

Sara Camden:

I don’t know that I have an efficiency loss statistic off the top of my head, but you know, one of the big things is just that loss of real time feedback loop. SKAN has a couple of different timing mechanisms that delay when marketers get that insight into their campaign performance, both from the conversion window standpoint, but then also this randomized delay that Apple applies on top of that just to make sure that you can’t triangulate who an individual user is, which kind of goes against the whole spirit of why SKAN exists today. 

So that certainly has been a gap that most folks are addressing through various predictive models to try to pinpoint when a specific conversion event occurred and what that event was in some cases, because you have to overcome these privacy restrictions before you even get insight into what exactly that user did from a conversion event standpoint.

John Koetsier:

Mm-hmm. So now we’re moving into SKAN 4. There’s more data available. You’ve got fine conversion values, not just course conversion values. You’ve got three postbacks, so you can have a little bit of longevity over time. There’s a bunch of other things going on. 

How’s that transition going? Where are we in that transition?

Sara Camden:

Yeah, yeah, that transition is a welcomed one from our perspective. You know, as you mentioned, we get more data more often. It’s also much more predictable. 

I think anyone who’s experienced SKAN has probably cursed the pesky delay or the conversion window that kept resetting every 24 hours when a new event occurred. So now we have these 3 fixed windows of the first 48 hours post install. then days 3 to 7, and then days 8 to 35. And each of those comes with a postback versus just a single postback before. 

So, you know, you do get that view into more of the consumer’s lifetime value post install, which is incredibly valuable. 

And as far as an uptake perspective, I’ve been noticing a lot of attention coming from advertisers that had been completely averse to SKAN in the past. Either they were using mechanisms like probabilistic attribution, or maybe even diverting their budgets away from iOS entirely. They seem to have turned a corner and are now actually wanting to embrace SKAN, both the earlier versions, as well as SKAN 4. 

The publishers are coming alongside as well. SKAN 4 officially rolled out into the wild this past October … we were seeing sub 5% of bid requests that were iOS as SKAN 4 compatible. But now coming into April, we’re up to 20%. So, you know, there is supply out there to bid on. And really the biggest impediment at this point is just getting the advertisers to come along and update their conversion value models to align with the scan for standards.

John Koetsier:

Wow, that is news to me. I had not heard that it’s at 20% right now. That’s obviously nowhere near where it needs to be for full adoption or anything like that, but that’s not insignificant. That’s not insignificant at all. That means that there’s widespread testing. There’s the beginning of widespread adoption. 

That is really interesting, and it’ll be super interesting to see how that pace accelerates or continues to grow over time. One thing that’s interesting …

Sara Camden:

Absolutely.

John Koetsier:

Yeah, one thing that’s interesting to me is, obviously in SKAN 3, if you didn’t have a sufficient number of installs, you hit privacy constraints and you just didn’t get data, right?

Sara Camden:

Right.

John Koetsier:

Do you feel in SKAN 4, that bar is lower, at least for getting course postbacks for your first postback?

Sara Camden:

Yeah. Yeah, yeah, absolutely. Early results that we’re seeing is that now you get some level of conversion insights at around five installs per day per campaign, whereas it was about 15 in the earlier version. 

So, you know, that certainly is a marked improvement over the earlier iterations.

John Koetsier:

That is really interesting. And of course marketers want everything. They want the fine conversion value. They want the source identifier. They want all the data you can possibly get when you let’s say beat or exceed crowd anonymity numbers in SKAN 4, but getting at least some data even at very low levels is a huge improvement because getting those blanks in SKAN 3 I think contributed to what you talked about … those marketers that said, I’m opting out. I’m out of here. I’m not dealing with this SKAN business at all because they got null values or else they got values that were insane. 

$100 for CPI or $500 for CPI, because so may of their campaigns didn’t meet the privacy requirements. That’s really good news.

Sara Camden:

Yeah, yeah, I would completely agree. And it really opens up iOS again to some of the smaller budget advertisers because those privacy limitations in earlier versions would just preclude them from being able to spend enough to get over the privacy threshold and actually get some insights into their conversions.

John Koetsier:

Of course, we’re in multiple transitions right now, right? We’re going SKAN 3 to SKAN 4. And we’ve talked a little bit about how that’s going. We know Privacy Sandbox is happening. And we see every month or two, Google releases a little piece of information, a little thing here, a little thing there.

I think the promise was GAID would be end of lifed end of this year.

Who knows? We’ve seen that the third party cookie has received new leases on life quite frequently from Google. What’s your sense of privacy sandbox and when marketers need to really start paying attention to that?

Sara Camden:

Yeah, yeah, it’s interesting. You mentioned how the can keeps getting kicked down the road when it comes to deprecating third-party cookies. I’ve not been seeing that same friction when it comes to the mobile identifiers. I think because they’ve gotten that practice with iOS and App Tracking Transparency that they’re more prepared for that. 

So I’m not seeing the type of delays that we’ve seen with cookie deprecation. So honestly, by the end of this year, I think marketers need to be ready to predominantly be targeting their campaigns and doing attribution without relying on IDs.

John Koetsier:

That is super interesting and kind of freaky because I had sort of back my mind, and I wonder maybe a good chunk of marketers, we tend to be optimistic people, right? You know, it’ll be more time, we’ll have more opportunity. 

I kind of figured, you know, Google will kick the can down the road, you know, 3 months, 6 months, something like that, who knows, we’ll see where it goes. And I think many marketers have been thinking in similar ways and therefore not really getting ready. Also because guess what: They’re busy with the SKAN 4 transition, which is not easy in and of itself. 

But you bring up a good point: that hasn’t moved since Google announced it maybe a year ago, something like that. And also there’s the iOS precedent, right? 

So Apple gave some warning, but when it happened, IDFA was out. I mean, it’s possible to get, but it’s really, really hard to get. And you get a small fraction. Maybe with the extensive warning that Google gave … 5hey’re like, hey, that is it. It’s gone. It’s done. I’m not sure if the industry is ready for that yet.

Sara Camden:

Yeah, yeah, I would agree. I mean, marketers are pretty instant gratification minded. And you know, if there’s workarounds, you can’t blame them for taking advantage. But you know, the way that we try to advise our customers is, by all means, make hay while the sun is shining. 

But do not ignore the looming clouds on the horizon because you could be caught flat-footed and you’re going to be in a lot of trouble. 

So right now is the time to really be testing and learning and gathering a repository of data on how to make your campaigns perform without IDs because you’re going to be at a big competitive disadvantage when those bandaids get pulled off, whether it be Apple enforcing their policies that ban fingerprinting. or the eventual rollout of Android Privacy Sandbox.

John Koetsier:

Mm-hmm. As a DSP, when you look forward and see Privacy Sandbox for Android, how do you feel about it? Are you like, well, there’s a lot of data there. There’s more data than even at SKAN 4 level. 

Are you cautiously optimistic? Or are you thinking, wow, no GAID, we’re screwed?

Sara Camden:

Yeah, I’m definitely optimistic. You know, part of why I came to InMobi, like I was very happy at my last job, but I loved sort of their forward looking vision and preparing for that world without identifiers, you know, going all in on that from a strategy standpoint. 

So yeah, I’m actually very optimistic based on the results that we’ve been seeing with earlier versions of SKAN, where we’ve been able to get KPIs costs at parity with ID-based traffic and fingerprinting campaigns. So I’m very optimistic about it. 

And Google Privacy Sandbox, it addresses some of the things that ScSKANan doesn’t today. It’s almost like if you could mash the two of those solutions up together, it’d be a pretty viable long-term solution because Google’s kind of solved for the front end audience targeting piece of the pie, and then Apple solved for the measurement piece of the pie. So, putting those two things together, I think, is a pretty reasonable solution.

John Koetsier:

Well, that’d be interesting. Easy solution. Put Apple and Google in a room, force them to figure it out. 

Sara Camden:

Right? They love to work together, right?

John Koetsier:

Best friends, obviously.

Sara Camden:

Frenemies.

John Koetsier:

Well, yes, it is interesting. There’s some speculation that, you know, obviously the industry has been pushing for stuff from SKAN 3 that we’re sort of seeing in SKAN 4, but there’s some speculation that privacy sandbox has impacted what Apple has put in SKAdNetwork version 4 and that evolution will continue over time. 

Very likely as each massive mobile player sees what the other is doing. It says, okay, we can add this or we can add that. It’s a little different than Google … in Google’s perspective because Google is an ad network. That’s how they make 97.9% of their money. That’s not an official stat. Don’t quote me on that, but it’s somewhere around there.

Sara Camden:

It’s close enough, it’s close enough.

John Koetsier:

Exactly. Whereas Apple, it has an ad network, but I mean, it’s a rounding error on their profit. So interesting times ahead. And you mentioned already, marketers need to prepare, be ready for a future without ad IDs. 

Talk about how DSPs will help marketers win in this era.

Sara Camden:

Yeah, yeah. I mean, DSPs as well as MMPs, I think are great consultative partners on this, particularly those that have been investing in this idealistic future for a while, because there’s a lot of them that haven’t. 

But, you know, in the case of InMobi, we’ve started very aggressively investing in and staffing up to support SKAN and really building it into our roadmap. You know, back when App Tracking Transparency was first announced, we started running idealistic campaigns. So we’ve got sort of this repository of learnings that goes into all of our bidding models that are ID free. 

So, finding those DSP media partners that have the experience that can kind of help them along that journey, as well as leaning on their MMPs for how they should adapt their reporting strategies and attribution strategies to support this idealist future, I think is the key to helping make that jump.

John Koetsier:

Excellent. Sara, thank you for taking this time.

Sara Camden:

My pleasure, it was a great chat.

Privacy Sandbox on Android: from black box to sandbox, thanks to a 360-degree advertising suite

45% of marketers say the transition to Privacy Sandbox on Android will be less disruptive than the iOS transition to SKAdNetwork. 35% say it’ll be the same, while 20% think it will be more disruptive. 

The majority of marketers might just be right.

Experts say that while Privacy Sandbox on Android will break more things in mobile adtech than ATT and SKAdNetwork did on iOS, the overall effect will be less disruptive. Part of the reason: Privacy Sandbox is a complete advertising suite.

How disruptive will Privacy Sandbox compared to ATT?

We recently hosted our first webinar on Privacy Sandbox on Android in a long time. Most of our recent privacy webinars have been on iOS, ATT, and SKAdNetwork, but Privacy Sandbox is coming in 2024, and that’s sooner than we think. 

The participants:

  • Gus Viegas, head of growth at Lessmore
  • Claire Rozain, founder at Global Warming Games
  • Sergio Serra, product head at InMobi
  • Eran Friedman, co-founder and CTO at Singular

Privacy Sandbox on Android: advertising efficiency

The good news is that adtech players and measurement providers such as Singular look to be doing the heavy lifting now to make it at least somewhat easier on advertisers and marketers in the future. The bad news is that advertising efficiency will decrease, just as it has on iOS.

“It will reduce the efficiency of your marketing slightly,” says Lessmore’s Gus Viegas. “But it won’t be a big, big change. It will be, let’s say, 10 or 20% difference from what you’re getting now in terms of efficiency.”

That’s on the one hand comforting — Armageddon is not around the corner, and the campaign devastation many saw in the early days of SKAN 3 likely won’t happen — but on the other hand a cold wake-up slap in the face. If you’re already operating on razor-thin ROAS margins, it’s a call to action to boost efficiency and signal and ROI as much as possible.

Google Referrer stays

There’s a few reasons why Privacy Sandbox on Android will likely be less impactful on marketers.

One is that the Google Referrer is still around.

“It’s basically a mechanism that existed in Android for several years now, specifically for the Google Play Store apps, and also other Android stores that are working on similar mechanisms,” Friedman explains. “When you click a link to the Play Store, you can include what’s called the referrer parameter, and that would be passed to the app once it’s launched. And this mechanism has been used across the board for attribution purposes. So, whenever there’s a user, it came from a specific campaign, you can actually know where it came from, basically based on that Referrer even regardless of the GAID.”

That comes straight from Google’s history on the web, of course, where websites typically get access to the referrer: the site that someone clicked a link on in order to arrive. It helps provide context, start personalization, and provide insight into customer/user/player journeys. In mobile, the referrer can do some of those same things, while also playing a role in marketing measurement.

It never existed on the iOS side, but it has on Android. 

And so far, it appears to be staying.

Privacy Sandbox offers more granularity than SKAdNetwork

Another reason: more granularity.

“You are going to have a really good granularity in your data into the reports you’re going to have aggregated on the Google side,” Global Warming Games founder Claire Rozain says.

While there isn’t a huge amount of data down-funnel, you will get multiple conversion events extending out to 30 days. And upper-funnel data will be truly rich: event-level reports will provide a super granular breakdown of your upper-funnel data (think campaign, sub-campaign, creative, down to the click_id itself), as Singular CEO Gadi Eliashiv has said.

Targeting, retargeting, attribution, and more

Yet another reason Privacy Sandbox on Android won’t be as disruptive: as an ad network, Google has built Privacy Sandbox on Android to function in an adtech and marketing context. 

The downside is that it will break more, InMobi’s Sergio Serra says. That’s because it’s a full suite for much of what needs to happen in advertising.

“In my mind, Privacy Sandbox for Android is going to be more breaking than SKAN, in a way, but less disruptive,” Serra said. “What I mean by this is that Privacy Sandbox for Android is a complete advertising suite … it goes 360 degrees from targeting, retargeting, fingerprinting crackdown, and attribution.”

As ironSource’s Yevgeny Peres told me on the Growth Masterminds podcast almost a year ago, Privacy Sandbox for Android is a much fuller-featured ad technology than Apple’s ATT and SKAdNetwork. That means the ecosystem has more pieces to pick up and more tech to build around the way Google is reinventing each of those aspects.

But it also means that hopefully, the burden will be on the ecosystem partners, not the advertisers and marketers. Which doesn’t mean it will be easy … but most marketers think it will be easier to adapt than it was on iOS with SKAdNetwork.

Interestingly, over 90% of participants in the webinar said that Apple was likely to borrow a few aspects of Privacy Sandbox on Android from Google for SKAN 5, whenever that arrives.

Will Apple borrow some aspects of Privacy Sandbox for SKAN 5?

“The core of the thing is that it’s not a disruption, but we’re moving from a black box to a sandbox,” says Rozain.

That’s good, but only 19% of participants said they were “as ready as they could be” for a future without advertising identifiers. So there’s still some significant amount of work to be done.

Topics API: How Privacy Sandbox on Android connects people with ads

Topics API is how Privacy Sandbox on Android — and on Chrome — will help advertisers connect with relevant audiences. It will not surprise anyone in the mobile apps industry that one of the core components of advertising technology is figuring out how to connect people and ads. Fraudsters and low-quality ad networks don’t care who they show an ad to — or even that a real person sees an ad — but ad partners worthy of the name expend a huge amount of effort and painstaking care in building technology for high quality matching between advertisers and potential users or customers.

In Privacy Sandbox for Android, Google’s proposing to take on that burden with the Topics API.

This post is part of a series on Privacy Sandbox:

Ad targeting

Let’s start by taking a giant step back and thinking about how to do ad targeting in general. There are multiple ways to target people with ads, of course, but the problem is that many of them have significant privacy downsides.

Targeting methodology Effectiveness? Technology requirements Privacy safe?
Behavior High Requires trackingGenerally invasive Not easily
Location Medium Requires metadataCan be dangerous over time Not easily
Demographics Medium Requires third-party dataRequires some level of identity resolution Somewhat
Context Low Requires knowledge of context Mostly
Interests Low Requires knowledge of interests Potentially
Intent High Requires knowledge of searches Potentially

Every targeting mechanism can be potentially privacy-safe, but each has risks and some modes have higher risks than others. 

For example, Apple’s SKAdNetwork is deterministic: each install postback is generally speaking a 100% guarantee that someone has installed your app. However, despite that, because it’s not granular per user and because it obscures significant amounts of marketing measurement data via privacy thresholds in SKAN 3 or crowd anonymity in SKAN 4, it’s low-risk for privacy violations.

Digital behavior such as website visits or app usage, generally acquired via trackers like third-party cookies or advertising identifiers (IDFA, GAID), is fairly invasive. But it could theoretically be made privacy safe through additional features such as differential privacy, grouped audiences, noise addition, and so on. (The question would be: could a high-volume advertiser break the code, get enough data, demystify the data, and identify people specifically? And, do you trust whoever is creating the audiences?)

Context is generally privacy safe: an ad relates to the content on the website or in the app that surrounds the ad, not to the person. 

The logical leap that advertisers take from context, of course, is that people who are viewing information about sports, for example, are interested in sports, perhaps play sports, might like beer or party food, might be interested in buying sports memorabilia, and so on. That logical leap can be a short one, an obvious one, a long one, a clever non-obvious one, or completely wrong.

Interests and Topics API

Interests, which Google is leveraging in Topics API for the Android privacy sandbox, are interesting.

Why?

Topics are more than context. Context is good, but it’s limited to a specific page or screen. Someone could have clicked the wrong link, followed clickbait, or tapped on the wrong screen in an app. Alternatively, it could be the right screen, but they’re only on it to get a needed piece of data, not because they are deeply and passionately interested in whatever that context is.

Interest, on the other hand, should be much more global and persistent over time.

Example: I like sports. That won’t change from week to week or month to month, though the exactly sports I engage with are likely to evolve over longer periods of time, or change over different seasons. And while Google’s building Topics API for fairly short-term interests, it’s still longer-term than just immediate context.

Google’s privacy sandbox defines a topic as a human-readable area of interest that someone demonstrates engagement with in the recent past. In fact, likely within just the last three weeks.

Topics are based on a user’s recent ad usage and app installs, but if a user deletes an app, any topics associated with that app won’t be removed from their list of topics, “in order to avoid disclosing information about the uninstallation,” Google says.

One challenge: Google’s current vision for topics is that there is a very limited taxonomy of them: between a few hundred and a few thousand topics, which Google will share to the marketing community at a later date. They will be human-curated so they won’t include sensitive topics, and are specifically intended to not be very granular:

“The Topics API intends to provide callers with coarse-grained advertising topics of interest based on the user’s app usage,” Google says.

The reason they’re not very granular: early tests with much higher levels of topic granularity proved insufficiently private. In other words, if you see enough data on what I am interested in, you’re likely to be able to triangulate my identity, or at least follow my digital trail around the internet. Clearly, Google wants to avoid too-tight targeting based on topics that adtech SDKs save and remember over time, associating with a user, in order to develop a very detailed profile of a person that could be used in privacy-threatening ways.

Or to develop a person or device graph.

Interestingly, Google says that potential topics for a user are defined by a classifier model for apps. 

In other words, apps feed the taxonomy for users, and the data that trains the model uses publicly available information like app name, description, and package name. Apps can map to multiple topics, or none, but there is a limit: no matter how many they have, only 3 will be added to the user’s topic history in any given week.

There is a degree of user control, however:

“The design intends to provide users with the ability to view and remove the topics that are associated with their app usage,” Google says.

There’s no mention of people adding topics manually, which could be interesting. I can see challenges with that, like people adding totally spurious data, but it could be useful nevertheless: I could define the topics that I want to see ads about, and Android’s privacy sandbox could ensure I only (or mostly) see ads about those topics. 

(And perhaps never see other topics on a different defined list.)

Targeting ads with Topics API: how it works

Every week, Google computes a user’s top 5 topics, which stay on-device. Google’s technology is figuring this out based on recent apps and app usage, but the information stays on-device and Google doesn’t know it.

When an app that monetizes via ads wants to fill an ad slot, the adtech SDK in the app calls the Topics API and checks if there’s a topic in the user’s list that matches a topic assigned to the app. Note: Google specifically prohibits SDKs or apps from storing that data and using it over time to build up a more detailed picture of the user’s interests and topics.

  1. Once a week, Android calculates a user’s top 5 topics
    1. Calling Topics API successfully will get your a topic randomly chosen from that list, 95% of the time
    2. 5% of the time, you’ll get a different topic, randomly chosen from the full taxonomy
  2. When you successfully call Topics API, you’ll get a maximum of 3 topics, 1 for each of the previous 3 weeks
    1. This means Android must store at least 15 top topics, many of which are likely to be duplicates
    2. Apps get different topics, thanks to the random pick and noise introduced, to ensure that app A and app B, which might be owned by the same publisher, can’t triangulate on individual users
  3. Successfully calling the Topics API, however, requires that apps or SDKs must have observed engagement with that topic within the past 3 weeks.
    1. It’s not 100% clear, but how I read this it that your general topic app with high usage but low-value ad slots can’t call a topic like “injury lawyer” or “auto insurance price quote” to try to capture high-value ad impressions
    2. In addition, Google says that if the app or SDK “ did not call the API in the past for that user on an app about that topic, then the topic will not be included in the list returned by the API”
    3. So, while it’s not entirely clear, since either the app or SDK can view that kind of engagement, there may be a scale advantage built into Topics in Privacy Sandbox for Android, simply due to the fact that larger, more-distributed SDKs will see more
    4. That scale advantage will be critical, too, because it’s not just lifetime visibility of topics we’re talking about: it has to be in the last three weeks

Note that apps can completely opt out of Topics API via their manifest and XML elements. In this case, apps don’t contribute to the weekly topic computation, Google says. Some larger apps that don’t see value in Topics or want to share any information about themselves to third-party ad SDKs, and some smaller apps that are extremely privacy-sensitive might therefore opt out entirely.

Current challenges with Topics

There are a number of potential problems with topics. Note that this is early and Google is seeking feedback, so these may all be resolved over time.

  1. Scale: if Google can’t convince enough publishers and adtech companies to opt in, Topics API won’t have enough data to produce meaningful results. On mobile particularly, this won’t be a problem since apps and advertisers need to opt in to get marketing measurement.
  2. Visibility: as Google has defined Topics API, you won’t see topics returned that you haven’t observed in the past. This could seriously limit targeting.
  3. Granularity of topics: with only hundreds to a few thousand topics, it’s hard to get granular. Sports is a big topic, but I may like 7 or 10 different sports, and I may follow 15 or 20 teams, and like 30 or 40 players. 
  4. Limited number of topics for apps: apps will only be able to add 3 topics to a user’s topic history in a given period of time. That’s really limiting for a big app like the NY Times, which deals with literally hundreds if not thousands of topics.
  5. No location info: Topics API does not currently seem to have any knowledge or provision for location information, which can be a critical component for targeting and can impact topic taxonomy significantly as well.
  6. Gaps when there’s no match: what happens if there’s no correlation between topics assigned to an app and topics that a user has generated? What ads do people see then?

Interest, Google’s next steps, and chiming in

There are some limitations to interest as a targeting factor, of course. Just because I like sports doesn’t mean I want to buy a jersey from my favorite team. Interest is also general and long-term, versus actionable behavior driven by things like searches, which show higher intent and are likely therefore higher value.

Also, interests are hard to correlate to purchase intent. As Shamanth Rao at Rocketship HQ says:

“The 5 ‘topics’ an SDK is accessing about a user are a very small sliver of a user’s persona. If the topic assigned to me is Europe, is that because I’m an American wanting to visit the continent? Because I’m an economist doing research? Am I reading a book about Europe? It’s going to be hard to pinpoint which of those contexts applies to me.”

It’s a step. And keeping data on-device is a major privacy win.

Still, there’s much still to figure out. And it’s unclear how well it will work compared to GAID (the smart money will bet on not nearly as well). In addition, how ad networks function with Topics and how mediation works with — or ignores — the technology remains to be defined. Google doesn’t necessarily have to force everyone to use its technology, but the eventual deprecation of the GAID will force the adtech ecosystem to look at this seriously as a means and methodology of connecting the right ad to the right person at the right time.

In other words, to successfully manage ad targeting.

We have two years before Google deprecates Android’s ad identifier, but if our experience on iOS means anything, those who prepare for the change before it happens will fare best.

One bit of good news for advertisers: the Google referrer will still be active. So, just like on the web, you’ll be able to get last-click identification of the source of a click, which is helpful data to add to your overall basket of marketing measurement information.

Making mobile ads suck less (and playing soccer) with Moloco VP Francesco Renzo

Why does every tiny engagement on a mobile ad on iOS seem to pop up an App Store overlay? Because as Moloco VP Francesco Renzo explains, the mobile adtech ecosystem is like a soccer game. (Or football, if you’re not North American.)

Bear with me on this.

It will actually make sense.

Mobile attribution: a global game of soccer

The mobile attribution games, Renzo says, are a global game of soccer. Ad networks are the teams. They’re trying to score goals, and they achieve that when they find a new player, user, or customer for their advertisers. Everyone used to know exactly where the goal was, thanks to the trackability of the iOS ad identifier, the IDFA. But since App Tracking Transparency made IDFAs scarce, it’s become much harder to tell which shots hit the target and get the right new users, and which miss by miles, to the sarcastic whistles of a scornful crowd. The result is that ad networks now shoot from everywhere on the soccer pitch: well outside the 18-yard box, their own side of the halfway line, the corner of the field, from their own goal line. Even, sometimes, from completely off the field.

Each of those shots is a triggered SKOverlay that fires off a “click” in SKAdNetwork.

Each is a chance to score a goal, win the game, add value for advertisers, and enhance the ad network’s ability to sell its services. So fire away, damn the torpedoes, charge of the light brigade, and bombard users with pop-up StoreKit-rendered invitations to please pretty please DOWNLOAD THIS APP NOW.

The only problem, as I chatted about in bad ads and the tragedy of the commons and as Mega Games CEO Adam Jaffe shared in a recent Growth Masterminds interview, it doesn’t make for a great user experience in publisher apps … the ones with the ads. It can make mobile ads suck.

Clicks and goals are good for ad networks, but a horrible user experience is bad for the ecosystem.

“There’s a bit of a disconnect between short-term incentives and long-term value or long-term ecosystem health,” Renzo says.

Plus there’s another disconnect for publishers: too many non-converting ads means they’ll run the risk of essentially demonetizing themselves.

Clicks, clicks, and more clicks in mobile ads

Renzo and I recently chatted over the problem in a Growth Masterminds podcast that I titled Making mobile ads suck less. Our non-sports goal: determine what’s causing the massive jump in CTR and concurrent poor user experience, and discuss how to fix it, how advertisers should deal with the situation, and what this all means for measurement in the era of privacy.

It starts with something that surprised me: there is no real definition of a “click” in SKAdNetwork.

“There’s this very interesting page on Apple’s documentation, which is about winning postbacks,” Renzo says. “And on SKAN, a click is equal to a view. Literally, the word click is not included in the winning attribution postback documentation.”

So adtech companies generate clicks via taps, missed X hits, attempts to play a playable.
And once one network starts, the others are forced to follow or their CTR looks bad, they take fewer shots on net, and they score fewer goals: all essentially suicidal business strategies.

It’s an arms race that hopefully won’t end up in mutually assured destruction for the ecosystem if users/players/customers start opting out.

But how do we fix it?

Smarter measurement models

Incrementality, media mix modeling, and all the other measurement methodologies that Singular is building as part of hybrid measurement is a big part of the solution, because that is immune to click spamming and other attribution shenanigans. Auditing your media sources, Renzo says, is another one, including asking the hard questions around what is a click, what are the tactics, when they fire clicks, and how they engage with attribution partners.

There’s also some promise in more granular click reporting, Renzo says.

“You can have a click that was explicitly on a call to action button. You can have a click that was perhaps an engagement with the playable component of the ad. Or you can have a click that perhaps is in the area where usually the X button is or an unqualified click that’s happening somewhere else that we cannot quite tell if it was indicative of installing intent or not. If advertisers had visibility on those types of click interactions, then they could attribute different value to those different click interactions. Just like now, for a click versus a view, you have a hierarchy of attribution.”

There’s much more, of course.

Watch the full video above, and subscribe to the Growth Masterminds podcast on your favorite podcasting platform.

And … here’s a full transcript of our conversation …

Making mobile ads suck less, with Moloco’s Francesco Renzo

John Koetsier:

How can we make mobile ads suck less? Hello and welcome to Growth Masterminds. My name is John Koetsier. 

I recently published a massive post on Singular’s website. I was a little pissed off, not so much at mobile ads per se, but kind of at the infrastructure and architecture within which they’re delivered. The fake clicks when you try and open the playable, the imaginary clicks. when the ad just randomly opens the App Store, the non-functional X button or the intentionally tiny, small little X button jammed into a corner. 

Is all this fixable or is this the end state of mobile advertising? 

To chat, we’ve got Francesco Renzo. Beside his super Italian sounding name, he has nine years of experience at Google helping app developers win. He has an MBA, he had a stint at McKinsey and is now VP go-to-market at Moloco. Which is, as you probably know, a performance advertising platform that relies heavily on AI and machine learning and did very well, by the way, in our recent Singular ROI index. 

Welcome, Francesco.

Francesco Renzo:

Thank you, John. Great to be here. Thank you for having me.

John Koetsier:

Hey, super pumped to have you. Let’s start at the beginning. 

What sucks about mobile ads right now?

Francesco Renzo:

Oh look, just like you were hinting earlier, you know, there’s a lot to be liked about mobile ads. 

You know, they power the internet, they power a lot of the free content games and apps that billions of users worldwide use. You know, sometimes I have this conversation with friends who blame me for all the ads that they see online. And I’m like, look, that’s probably the biggest wealth transfer in history. You know, there are rich high rollers who watch ads that are basically funding … free content for a bunch of other people around the world who would not be able to afford those services if those were paid. 

So there’s a lot to be liked about mobile ads. 

There’s also a lot that sucks these days about mobile ads. I thought that your blog post from a couple of weeks ago, if I remember correctly, really hit the nail on the head. The user experience is quite terrible and there’s a number of interesting incentives in the ecosystem that have led us where we are. If you think about what deterministic mobile ads looked like a few years back before ATT, there was a precision in how those ads were targeted, and every player up and on the stack could tell exactly which users had seen a certain ad and could clearly attribute the outcomes that that ad drove for that particular user. 

With limited ad tracking both on Android and iOS and then ATT on iOS in particular, that whole predicament went out the window. 

And so, you know, there are two things that I obsess about. And you know, one is mobile ads and the other one is soccer or football if you’re European like me. 

And you know, one metaphor I like to think about, it’s a little bit like, you know, the attribution games that are played on mobile ads are a little bit like a soccer game. And the teams are the networks who are serving those ads. And scoring a goal is finding a user who will deliver good results. And everybody knows where the goal is, what the goal posts are. And so the players, the network to serve those ads, are very precise at shooting on goal. 

And limited tracking a little bit got rid of the net, got rid of the goal. And you know, it’s hard to tell which of your shots in that general direction are hitting the right users. 

And so what’s happened is that people, people as in the networks who serve ads, try to take as many shots as possible towards that end line of the pitch in the hopes that some of those are going to turn out to be good users, right? If the referee in this silly metaphor is the advertiser, the advertiser is just going to see: Hey, how many balls eventually did end on goal. 

And the team that wins the game gets more budget from the advertising. So it’s quite unfortunate, but there are also some really powerful incentives that got us where we are.

John Koetsier:

So it’s Apple’s fault, ATT is causing … 🙂

That’s probably not the correct interpretation of what you said, but it’s one possible. 

Look, we have the challenge here and we’re gonna have the challenge on Android as well. As Privacy Sandbox rolls out probably early to mid or late 2024 – we’ll see when that happens – there’s a little bit more targeting capability in that than we’ll have on iOS. Although SKAN 5 might borrow some things from Privacy Sandbox, who knows? 

Before we talk about how to fix it, who can fix it, and how advertisers survive in this game of football, what’s the risk factor here? 

I mean, all these networks are trying to score a goal. Thousands of balls are being pumped towards the net. The goalie is like ugh …

What’s the risk factor? How does this impact the ecosystem, which is the people, right? The players, the customers, the users of these apps?

Francesco Renzo:

I wouldn’t say it’s Apple’s fault. I would say, you know, there are some very legitimate arguments for, you know, limiting ad tracking. 

The problem is that the ecosystem is a bit more complex than that. And so there have been some perhaps unintended consequences. And, you know, you’re asking the right question. 

If ultimately the biggest damage gets to the user experience, then the next natural question is … what does that do to the rest of the ecosystem? And what can the rest of the ecosystem do? 

I think the challenge is that, you know, you were calling it a tragedy of the commons in your blog post. I think it’s correct. It’s accurate. 

Another way to qualify it is also, it’s a bit of a disconnect between short-term incentives and long-term value or long-term ecosystem health. And the problem is that the short-term incentives for the players in the industry are all very stacked towards these kinds of outcomes. 

And if you start from the ad tech companies in between, the publishers and the advertisers with the users on the other side, those ad tech companies benefit from winning that football game, right? And they have to contend also with the fact that measurement, which is critical of course for performance marketing, is now in this interesting state where we have the SKAN framework that Apple has given on iOS, and then there is all the different attribution approaches that are SKAN-friendly but somewhat distinct that the mobile measurement partners put in place, whether it’s probabilistic attribution or whatever other labels different MMPs are using. 

In this environment, if you are on SKAN, there’s this very interesting page on Apple’s documentation, which is about winning postbacks. And on SKAN, a click is equal to a view. Literally, the word click is not included in the winning attribution postback documentation. 

And then there is this concept of a fidelity score that applies to SKAN, where essentially, in addition to who delivers the last click, you get a higher fidelity score if, for example, you render a store kit ad, whether it’s SK Overlay or AutoStore. 

So you get an advantage. 

So now you see a little bit of the advantage of SKAN measurement from creating all those overlays or those additional App Store experiences as part of your ad experience. And then if you are measuring using MMPs, the challenge for those app tech companies in between is that the StoreKit-rendered components of the ads are purely controlled by Apple.

And if a user clicks on one of those because they were engaged by the ad, they liked being sent or being exposed to something that’s similar to an App Store experience, But the ad tech company that served that ad does not know. The trackability of that click is entirely lost to the ad tech company. And so for an advertiser who uses a mobile measurement partner, how do you know if that ad was helpful or not? 

Well, the ad tech companies have addressed that problem by resorting to a number of tactics that get more clicks fired or more attribution signals passed on to the mobile measurement partners. And everything that you were pointing out earlier, whether it’s the very small X button or the multiple store exposures, or the inadvertent click that miraculously brings you to the App Store, the playable engagement, which is marked as a real click. All of those ad interactions, some more engaging and positive, and some a little bit more damaging … all of that ends up being a click fired to an MMP. 

So … for the ad tech platforms in between, the incentives are very powerful to move in that direction. If one ad tech platform doesn’t do that, they will be at a huge disadvantage versus their competitors who are moving in that direction. And then you have the incentives on the publisher side, right? The publishers are on the receiving end of that bad ad experience. And if they were to totally step away from it, the algorithms that power adserving penalize their inventory.

Their ads would appear less performant, and therefore they would lose volume. Now you will say, well, but I know for a fact that when I have a terrible ad experience, I hate that game, and I don’t play it anymore. 

The challenge is that, as I was mentioning earlier, it’s a trade-off between a very real short-term loss of traffic versus a fairly uncertain and unmeasured, I haven’t seen any meta study on that, loss of customer loyalty and increased churn.

So for the publisher also, the incentives are really stacked around playing along these rules. 

And then there’s the advertisers, who of course, they have to drive profitable growth. They look at their cost per install. They look at their return on advertiser spend. And all these techniques eventually help drive down those performance metrics. Also because a lot of these very aggressive attribution tactics end up catching some organic installs, right? Users will be installed anyway. If you were to clean everything up with a magic wand tomorrow, probably CPIs would go up and return on advertiser spend would go down. And so cleaning things up is not only hard because it’s a systematic issue that no advertiser can individually address. And also it’s not like my performance review as a marketer is damaged by this, if anything, it’s helped by this.

So up and down the ad tech stack, there’s very powerful incentives that led us to this status quo and make it a challenging uphill battle.

John Koetsier:

You supplied a soccer or football metaphor. I’ll supply a hockey metaphor – ice hockey, because I’m Canadian and I play, and it’s the playoffs right now as we’re recording this – and there’s a saying in the playoffs, especially overtime after the traditional three periods and teams are still tied, the score is tied. 

There  is a saying that “there’s no bad shot on net.” And that is apparently. the ethos in the ad tech ecosystem right now. 

Okay, so you’ve outlined why it’s happening. You’ve outlined what are the factors that are causing this. We talked briefly about the risk factors, which is maybe somebody churns from an app, that’s possible. Maybe somebody just doesn’t go for those rewarded ads anymore. There’s a rewarded ad unit, they just don’t do that anymore. Maybe they turn off mobile a little bit and turn on to something else or who knows what. Lots of things there. 

So let’s talk a little bit about the fix. If we’re going to fix this at an ecosystem level, how can that be done? I know that somebody – there was some discussion on LinkedIn – and somebody I believe formerly from AdColony was saying: hey, we need a count of how many times an ad unit has kicked off SK Overlay or an App Store View. And that will tell us if it kicks it off 10 times in a session, let’s say, it’s a little suspicious. 

When we see click-through rates that are really high, it’s a little suspicious. So we need some extra functionality in SKAdNetwork to tell us more about ad quality and people who are basically manipulating that. 

Is that a solution? Is there another solution?

Francesco Renzo:

Yeah, it’s a great question. I would say even before going there, I would say it has to be fixed. It has to be fixed because it is becoming increasingly apparent that the costs outweigh the benefits in the long run. 

For publishers, there is exactly the point you’re making, users being churned away. 

I would say also for advertisers, there’s a hidden cost which cannot be … ignored much longer, right? The advertisers who essentially end up rewarding the media sources that are most aggressive at this game are probably misallocating their budget a little bit, and they’re probably paying for users who will come in anyway. 

And so what is the fix? 

I think that there is a lot of talk in the industry around complementing bottom-up attribution. what the industry has been doing up until now with more top-down measurement approaches. So, incrementality measurement, marketing mix modeling, more coarse and long-term aggregated measures of performance for different media channels have to become an element of sophisticated marketers’ toolkits. 

And then, I think that there are some short-term … things that advertisers can do or marketers can do right away. Some perhaps medium term levers that the white knights in the ecosystem can experiment with. And then there’s perhaps some longer term things that I would envision and hope the ecosystem will consider. 

I think in the short term, the first thing is try to educate yourself and your management team on what is happening in the industry. It’s a little bit tricky, right? Because from a marketer, media buyer perspective, you have to go look at what are perhaps some less incremental dollars that you’ve spent with some channels. You need to have the conversation … if I think about the marketing organizations that these decisions are made in, you have to basically go to your boss and say: hey, look, up until now, in the last couple of years, we may have not spent our money as efficiently as possible. And we did a bit of an audit of our marketing channels. And this is what we’ve seen in terms of the tactics they use for attribution.

So there is a little bit of that awareness that needs to come up on the marketing side. Auditing your media sources, understanding how they’re doing attribution and what kind of click firing behaviors they’re driving is the first short-term thing that I think must happen. 

Second, there is an opportunity to get a little bit smarter on testing, right? Whether it’s incrementality and lift testing, or whether it’s about considering spend consolidation for all the open internet programmatic inventory. If you think about it, inventory access used to be a huge competitive advantage back in the day.

Now the vast majority of the in-app inventory is open to real-time bidding and fairly accessible to all the demand players or SDK networks that you’re working with. And you know if you are to look at one player only, right, for a one app in one market, and compare to what that performance looks like relative to your current media mix. And what do those two test cells look like relative to maybe another test cell where you’re not spending at all, right? What kind of incrementality do you see when you are eliminating these competitions and when you’re eliminating these overexposure?

Of course, there are trade-offs there, right? Because you want to keep your media mix diversified. 

But even just to see what different media partners are doing and measure the relative incrementality, spend consolidation tests are one lever that we’re seeing some of our biggest partners consider. And then look, the question is, these are patches. This helps illuminate and size the problem, but then how does the ecosystem clean up going forward? 

One possible outcome is that it doesn’t. And so the savvy marketers are going to essentially rely more on top-down measurement, incrementality, marketing, mixed modeling, lift tests, and really reduce how they look at bottom-up measurement, and just use that for very tactical and fairly minor media management decisions. 

And then another, you know, I’ve been toying around with this idea for quite some time. I’m wondering if the industry needs to look at more granular click reporting. So imagine if advertisers demanded ad tech companies provided and the mobile measurement partners enabled more visibility on the type of ad interaction that any given user had.

Now all of a sudden a click is not a click anymore. You can have a click that was explicitly on a call to action button. You can have a click that was perhaps an engagement with the playable component of the ad. Or you can have a click that perhaps is in the area where usually the X button is or an unqualified click that’s happening somewhere else that we cannot quite tell if it was indicative of installing intent or not. 

If advertisers had visibility on those types of click interactions, then they could attribute different value to those different click interactions. Just like now, for a click versus a view, you have a hierarchy of attribution. You have a different attribution window. You could envision a similar hierarchy of attribution for different click types. And if you do that, all of the sudden you have media budgets from advertisers who will go to media sources who can drive better interactions. 

The experimentation from a buyer perspective, from a marketer perspective would, you know, right now it’s hard to do a lot of experimentation given that it’s hard to do deterministic user level attribution, but all of that analytical horsepower could go to experimenting on different click interactions. 

I keep thinking of creative testing, creative experimentation.

I was at Google in 2017 when there was this big shift from manual campaigns to universal app campaigns, right? The first big machine learning driven automated product in app promo. And you know, my team and I built this entire capability around creative advisory, because creative was one of the big levers, right? And that’s been the name of the game, right? For quite some time. 

And then ATT and SKAN come along and all of a sudden creative testing is so much harder. And it’s made harder by the fact that when you’re looking at click-through rates, you can’t quite trust them because a click can be recorded for all sorts of different reasons that are not truly reflective of the real quality of the creative assets itself.

But in this hypothetical new world that I am envisioning where you have different click types now you can start experimenting with different creatives based on the type of click they drive, the type of user engagement they drive. 

I think if you start with that, then the rest of the ecosystem would need to adjust, right? Because then the media would follow the better interaction and the incentives to have these less valuable ones would die out a little bit.

John Koetsier:

Meta comment for a second. It’s such a pleasure to chat with somebody who is an expert, been in the space for a long time, understands it deeply, and can correlate a lot of these different things together. Super, super excellent.

So much in what you just said. I’m gonna hit on a couple things and then maybe introduce our last topic. 

I had a conversation just recently and just published it actually on Growth Masterminds with Adam Jaffe. He’s CEO of MegaGames, he’s been at Jam City, he’s been at multiple game studios and VP of Growth and UA roles and stuff like that and does some cool stuff.

Now we’re talking about this problem. 

He says, you know, as an ad network, I could be honest and come to you and say, you know what? CPIs, we report them, you know, $2, $3, $4. It’s actually $35. 

There’s a lot of clicks that you get there and a lot of users that come in that don’t do much, everything like that. But if I report to you $35, you’re going to say, are you kidding me? Forget that. Not happening ever. My VP finance, well, all this stuff.

But he says, so that’s a challenging conversation. So that’s interesting as well. 

We can talk about quality of click and what is a quality click? A click on a call to action. That would be very interesting compared to a random miss the X button click. And so I hope that something like that comes out. We’ll see. That would be interesting. 

I also liked your comment about spend consolidation in the era of programmatic. Of course you wanna try a lot of different things and you always need to be testing. I think Zynga is always testing two ad networks. Just as a matter of course, they’re always testing different, different places, seeing what’s going on. 

But when you think about programmatic and you think, hey, there’s the river of users. And like you said, most of them are accessible to most of the major programmatic players. How many fishing poles do you need in that river, right? Do you need fishing poles from 15 different companies in the same river? You might just be clouding up your marketing measurement. Who knows? 

And that’s kind of where I want to end actually, marketing measurement. We’ve touched on it in a couple of instances. 

As I look at marketing measurement of the future, we talked about the phrase everything, everywhere, all at once. And I mentioned the phrase that we used at Singular, which is Hybrid Measurement. You want to get all the data that you possibly can. And you want to use certain bits of data in certain scenarios for certain things. 

So if you can get your click-through data, great. But grains of salt, all that stuff. But you can get your top-level, impression-level data. You want to get that as well. You want to understand that, what’s going on, what’s happening there. 

You want your first-party data. You know what’s happening. That’s the most reputable data. 

You also do want your SKAN data eventually, your Privacy Sandbox data. You know it’s last click, you know it’s limited, you know there’s a bigger, wider user story there, but you know as well it’s deterministic even if it is aggregated, so that’s got some value. 

And you also want this big probabilistic picture with triple M or incrementality studies where you can say, hey, if I throw an extra $100,000 a month there, what changes? If I take that $50K a month away, what changes? And you need to understand that. You need to understand whether that’s monthly or whether that’s quarterly, or whether you can do that even with some magic pixie dust, fairy dust, a little more frequently, great. 

So I think that’s kind of the future of measurement, and it does entail, and I think we talked about this as well, a little bit of the abandonment of the illusion of certainty.

We’ve never had certainty. Just because somebody clicked on something on the web in 2001, that’s not the entirety of the user journey. And everybody who understands marketing or people knows that. There’s so much more going on. And the same is true for high-value users, players, customers, and mobile apps. So I think that there’s a mind shift. And you mentioned that. Eric Seufert’s talking about that as well. 

Talk about measurement as you see it.

Francesco Renzo:

Yeah, look, I think you hit on a number of points that I wholeheartedly agree with. 

You mentioned Zynga. We work with a lot of very sophisticated partners who are well on their way on this journey and are combining first-party data, top-down measurement, and bottom-up attribution metrics to come up with as accurate … a vision as possible of what is actually happening to their media dollars and where the next marginal dollar should be deployed. 

So I hold hope that this industry has a lot of really impressive minds that are thinking about these and they are thinking about what to do to operate in this new environment and how to win in the new environment. Because again, while the short-term incentives are stacked against a clean up of the ecosystem, it is also true that when you have really smart people, there will be someone who will say: Hey, you know what, I’m going to sacrifice some short-term metrics. I will actually bring my CFO along. I will explain that we have to rethink. How do we look at our marketing budget? We have to rethink how we look at our performance metrics? We have to reconsider what is truly coming from paid versus what is organic. 

And then, you know, all our first party data, our understanding of the user value curves is the other side of the equation that we have to match with our marketing investment. 

And, you know, those are the advertisers, marketers, mobile companies that are going to win in the long run, because guess what? They’re going to make a better use of their budget and they’re going to do a better job at getting the most bang from the buck. And look, one thing that I see those savvy marketers doing and one thing that, investing heavily is, you know, trying to get transparency and control from your media partners. While I agree with you that we’re probably past the illusion of certainty that characterized the deterministic attribution era, it is also true that marketers with big pockets should demand from their channels the ability to control.

Right? You know, when are you rendering a StoreKit element? And what kind of attribution behavior are you driving? You may or may not be able to control it fully, depending on the kind of partner you’re working on. But you should be aware. You should get a report. You should get some transparency.

And then that becomes part of the picture that you’re painting with this 360 degree measurement approach that you were describing, which I fully agree that that has to be the future.

John Koetsier:

Excellent. Well, all the good things must end and so must this conversation. It’s been a real pleasure. Thank you so much for your time.

Francesco Renzo:

Thank you so much for having me, John. It was a lot of fun.

How mobile ads can kill your app monetization (and why they need to be part of your product experience)

  • Mobile ads are not a monetization tool
  • Mobile ads are totally broken and the ecosystem is a disaster
  • Somehow, it all still works
  • Plus, you need to look at ads as part of your product, not as something you beam in from the Starship Enterprise just to make a few bucks

I recently had a long chat with Adam Jaffe on the Growth Masterminds podcast, and these are just a few of the insights he shared.

Also, he said, he loves ads.

Jaffe is a mobile ad adtech OG … one of those people with 26 experiences on his LinkedIn resume. He was the head of UA for Playtika, VP of Growth for Jam City, VP of marketing for Social Point, CMO for ABA English, CEO of Tenko Games, advisor on about 3,000 boards, an active investor, and is currently the founder and CEO of Mega Studio, which designs, makes, markets, monetizes, and diagnoses problems with mobile games.

So he knows a bit about mobile gaming.

Mobile ads are not a monetization tool?

And he knows a bit about mobile ads, and user acquisition, and ad monetization. Plus maybe just a few other things. Which makes a statement like this worth reading twice:

“I always try to get people to understand that ads are not a monetization tool, right? It’s a product tool to help you push users further in your game, to increase retention, to improve session length, to do all the things which your general KPI structure is meant to support.”

Adam Jaffe

In our hour-long chat we talked about mobile ads: the problems, the challenges, and disasters … but also how they fit and work in apps. How many are enough, and how many are too much. But where we started is the rant he posted on LinkedIn a few months ago requesting that mobile adtech companies fix their “f-ing” X buttons.

Bad ads

I chatted about the problem recently: Bad ads: when the tragedy of the commons meets mobile advertising.

You’ve had the experience: you watch a rewarded ad unit in your favorite game, only to not be able to X out of the video or playable. Tapping the X only brings up an iOS or Android interface to install a different app … perhaps not the best user experience. 

But it’s the experience, Jaffe explains, that derives directly from existing incentives in the industry:

“You don’t pay for clicks. Mostly you’re paying for Installs, and anytime you end up paying for an install your mind shifts away from this idea of like: “Hey what’s my CTR is my click through rate? Is it 2%? Is it 1%?

You don’t care. As long as those installs are coming in and the quality is there you’re super happy.”

Adam Jaffe

The only problem: this type of situation creates churn. And the people who care about that churn are often not the same people who want to optimize for either ad revenue or for user acquisition … especially when in most cases where you have an advertising app and an advertised app, they don’t even work for the same company.

An even deeper problem is when people don’t understand how to integrate ads into the fabric of their games and apps in ways that reinforce the core user loop and create deeper engagement. Instead, they just see ads as backfill, Jaffe says, for users to don’t pay.

Killing monetization with too many mobile ads

The result is not just worse engagement and retention. The result is also worse monetization.

“Two apps: exactly the same, okay? But one has five ads, the other one shows 15 impressions. The CPM on that 15 impressions per day is going to be half … it’s going to be significantly less than your five impressions. 

In fact, that five impressions per day app is going to make more money.”

Adam Jaffe

Check out the entire show to learn why.

The video is up top (subscribe to our YouTube channel here). Or subscribe to the Growth Masterminds audio podcast on all major platforms. Plus, check out the transcript of our call below.

Full transcript: Run fewer ads, make more money says gaming OG Adam Jaffe

Note: this is an AI-generated transcript that has been lightly edited for clarity and transcription errors. If in doubt, listen to the actual podcast or video.

John Koetsier:

Are bad ads going to kill mobile game monetization? 

Hello and welcome to Growth Masterminds. My name is John Koetsier. 

About a third of mobile games revenue is from ads, which makes it fairly important, not as important as in-app purchases, but pretty important. However, is the ad ecosystem killing the goose that lays those golden eggs? 

Here to chat is a gaming OG. He was formerly with Jam City. He was a CEO of Tango Games. He’s a former CMO, sits on advisory boards from multiple companies including Dataseat and INCRMTL, and is now founder and CEO of Mega Studio, a gaming agency that designs, builds, analyzes, and monetizes games. 

His name is Adam Jaffe. Welcome Adam!

Adam Jaffe:

Thanks John, thanks for having me man. Looking forward to this conversation.

John Koetsier:

Hey, it is a super pleasure to have you. It’s been a long time coming. We’ve chatted before, but it’s been, it’s gotta be pre-COVID, so happy to talk. I wanna read something that you wrote on LinkedIn three weeks ago, four weeks ago, something like that. 

You wrote this, I think that you just had a gaming experience that was maybe less than amazing, less than stellar, and you said: Fix your f-ing X button. This is why people hate ads in games … the UX is so unbelievably horrible that it’s often not worth it for the game dev in terms of retention. 

Talk about that.

Adam Jaffe:

Yeah, so as you mentioned, my studio, Mega Studio, we’re a first and third-party game development studio and I was doing some research on a project and this project was predominantly ad revenue based. And so I was playing a lot of games, seeing a lot of ads and I was in probably the 10th minute of my session and I kept getting the same ad and I couldn’t close the button. And every time I tried to close it, it would redirect me to the app store. And it just sort of struck me consistently that this is a terrible experience.

And you know from the marketing perspective of course you want to get as many clicks through that top of the funnel but now that I’m a studio owner and work with a bunch of studios this is potentially you know killing businesses.

John Koetsier:

It’s funny because pretty much only in gaming, can you say, you know, I’m working and I’m playing games. I’m playing games all day long. It’s research, honestly.

But you know, I’ve had the same experience. I have my favorite mobile game. There is ad monetization in there as well as in-app purchases. And I’ve bought a few things and then, you know, occasionally look at an ad when I don’t want to pony up again, right? And trying to click that X is sometimes almost impossible … almost any interaction, click, it kicks off that SKOverlay and boom, you’re in that sort of subset of the app store. 

And, and you know, that’s how you get a click through rate of 90% or something like that, which everybody knows is insane.

Adam Jaffe:

That’s true. And you know, I want to start by saying that I am a huge proponent of advertising. Huge. I mean, I started my career as a marketer. And so for me, ads are the gateway not just for game growth, but from both sides, right? You want to acquire, you want your game to grow, well, you need to make more money. So placing ads is honestly the best way to do that. 

In-app purchases can be hard to balance. There’s a lot of reasons why IAP is difficult to achieve. Obviously, we haven’t had an entire category of hypercasual, exclusively ad based. 

And then the other hand, if you want that game to grow, you gotta go out and you gotta use ironSource as the unit is, well, same company, the Fibers, all these companies still acquire traffic, Facebook of course, with FAN and AdMob of course, with the way that they monetize and the way that you acquire users. 

And so for me as a marketer, I see ads as key. Any company, and I have had many, many conversations both at the product level, C-level, tell me they don’t like ads or they don’t want to put them in their game. 

I always kind of laugh. Like it’s such an antiquated feeling.

On the other hand, you know, when you experience these types of problems and you know that the app developer probably has little to no control over this or they barely know that it’s even happening, you really feel for them. Although to be fair, I think that most people look at ads when they say they don’t like them, not because of this experience that you and I are describing where we can’t actually X out. It’s more because they feel that ads somehow cheapen the product experience. 

To a degree, that can be the case if they’re incorrectly implemented. But, you know, if done well, they can offer a really good experience, especially to a subset of users who may not have the capacity to pay.

John Koetsier:

I think in the case of rewarded ads, it’s a perfect marriage. It can be a perfect marriage, which is I want something, you have something, you want to give it to me because you want me to be engaged in your game and to progress and to do better. I want that because I want to feel success. I want to feel better. I want to win all those things. I can get that by watching this 30 second ad. 

But it used to be, I don’t know, maybe it was 15 seconds at one point. It’s the 35, 40, 45. Last night in my game. And you know what? That was just the video part of the ad, and then I was in a playable. So there was a video stacked with a playable, and it was like a minute and a half chunk of my game time. Now that is disruptive to me enjoying that game. That is massively disruptive. 

But if we get it right, then it works. 

What’s driving this arms race for clicks?

Adam Jaffe:

So I think it’s a combination of factors, but at the end of the day, even within the same company, you’re going to have really divergent views on this topic. 

Let’s just take company A spending, I don’t know. Let’s say company A spends $100 million because its games make $200 million. And they make a significant, let’s say they make a ton of money from advertisement and a ton of money from in-app purchases to your 30% as let’s call it like that, that split. So they have a big incentive to continue to run ads, of course. 

But from the marketing perspective, you’re looking at that and you’re saying, OK, I want to grow my product. So I want to spend money and I want to get the best CTRs. I want to get the best IPMs, plus I want the most installs.

But you don’t pay for clicks. Mostly you’re paying for Installs, and anytime you end up paying for an install your mind shifts away from this idea of like: “Hey what’s my CTR is my click through rate? Is it 2%? Is it 1%?”

You don’t care. As long as those installs are coming in and the quality is there you’re super happy. What that translates into is that the companies that typically work off of CPI as the way that they monetize, they have no interest whatsoever in guarding that click. The click is not a valuable commodity at this point. It’s only the install. 

So if they can push as much traffic to that landing page, even if it’s an erroneous click, maybe 0.01% of those guys goes on to install. And for them, that’s a win. Now, they don’t really care because the game developer isn’t necessarily hurting so much because they do get paid for it, right?

I am placing your ads, I’m paying you for this experience. I think the race to the bottom has been that, oh, if I just put the X of it off and you tap and you go, oh, wow, CTRs went up, IPMs went up, like that’s a win for the advertiser, and it can also be a win for the game. 

Why? Because the game is showing that it has a better eCPM. I can translate more of my value, or more of my users can become valuable to other advertisers out there. So it’s a very unique problem because both sides can appreciate this process having a positive impact on both revenue potentially, but also on acquisition. 

On the other hand, you’re sort of behind the manager or your game designer or whoever is trying to look at retention numbers or in fact long term monetization … these can be very, very delicate situations because they do create churn.

And they don’t create churn because of the ads. They create churn because of what those ads are now looking like, what the UX is on these user experience.

John Koetsier:

And it’s very interesting actually because now we’re starting to see ads in apps that are promoting other apps that don’t have ads. 

So I actually saw that just the other night I actually put it in the blog post where I quoted you as well but they’re they’re literally advertising that they don’t have ads … it’s very meta … if you click on this ad, the app does not have ads.

Adam Jaffe:

Yes.

John Koetsier:

So that is becoming a differentiator.

So talk about this from a product perspective and a user experience perspective. I’ll say if I can’t get rid of an ad it’s a bad user experience. If the reward sucks – and you know that sometimes happens because sometimes you get a variable reward and it could be something that really helps you in the game 0r it could be something that is just irrelevant or barely relevant, and if the reward sucks, that sucks …

But also if I have this big gap in my gameplay, I’m playing a mobile game because I have five minutes, because I have seven minutes, because I need a mental break, right? If you’re going to take 10% of that time and make me go through this experience, that’s going to suck from a product perspective and a user experience perspective. 

What is that? What do product managers feel about this? What do game designers feel about this?

Adam Jaffe:

So it’s actually kind of an interesting topic because, and I’m going to answer this probably not in the way that you’re expecting because the way that the ads were typically formulated in the past was, you know, let’s just, you know, interstitials as an example, right? Just what a horrible UX. You know, just randomly pop a 20 second ad in there and you’re frantically trying to close it because it’s in the middle of your game potentially.

John Koetsier:

Out of context.

Adam Jaffe:

Exactly. And the banners and what, I mean it was just, but today what ads actually are, you know, allow for is to give players a taste of what the item purchase should look like. And if your ad integration is done effectively, essentially what you’re doing, you start users down the path of watching ads. Okay fine, you don’t want to pay and there’s going to be a subset of players who are like, I’m paying yes, here’s my money, take it, cool. It doesn’t necessarily preclude them from watching ads by the way, but that of course is going to be a type of player and God bless them because they make it all work.

John Koetsier:

Everybody wants them, yes.

Adam Jaffe:

But the ad as a general rule of thumb, a way in which you can sort of push users to experience a taste of what it feels like to pay that premium subscription or premium or whatever, you know, to get the sword, to get the booster, to get the power up. And you’re doing it for maybe a fraction of the time or maybe it gives you only a percentage increase versus if you were to pay for it, it would give you, you know, multiples above what you’re currently getting. 

And so in this way ads are a way to sort of peek under the hood a little bit or behind the curtain and show you, hey … there’s a different experience in this game, and it sits behind this paywall, this pay experience. And we want to offer you an opportunity to participate in a part of that process. And for me, that’s how I always approach it. Ads can be this opportunity to enjoy an experience which you don’t necessarily have to pay for, but if you do pay for it, you’re going to get an even more enhanced experience. 

That being said, I think a lot of companies don’t really understand how ads are meant to be integrated … treating them as kind of backfill for just any user who isn’t going to pay, we’re going to just spam them to oblivion essentially. And that’s also not a really great approach. And I don’t really want to get too deep into like impressions and how many impressions you send out has a big impact on your overall app CPM. 

So I’ll give you an example. Two apps: exactly the same, okay? But one has five ads, the other one shows 15 impressions. The CPM on that 15 impressions per day is going to be half. I’m just going to say it exaggerated. But it’s going to be significantly less than your five impressions. 

In fact, that five impressions per day app is going to make more money. 

Why? Because the companies mediating that particular app, they’re going to see that this app has a slightly lower CTR. And so they’re going to basically push down our CPM for that product.

And so you see these companies that are blasting ads, and you’re realizing like, not only does this not work out in terms of money, it also doesn’t work in terms of value for you. And ultimately those players will churn without ever really giving you the kind of value you would have expected.

John Koetsier:

So that’s super interesting. So basically, they’re not just shooting themselves in the foot, they’re shooting themselves in the hand, they’re shooting themselves in the leg, they’re shooting themselves in the head, they’re shooting themselves everywhere because they’re destroying their game experience. They’re reducing their monetization by blasting you with ads. 

Adam Jaffe:

Exactly, exactly. The difference between first impression and seventh impression is like 99.9% drop in CPI. It’s a massive drop. 

But it’s not just that you drop in CPI on a per user basis. If you are consistently showing tons and tons and tons of ads and nobody is converting on those ads – because of course they’re not, because you’re showing them 15 ads a day, they’re not clicking 15 different times, right –  your overall CPI of that product on a category level will just decline because people will know that that product, this is remnant traffic. 

And there’s a secondary component to this, especially if you’re on iOS and you don’t have IDFA, right? So IDFA allows, of course, for behavioral targeting which can say, if this is a high quality user, let’s make sure he’s getting kind of the $3 to $4 CPMs. But if that is a bit lax or you don’t have IDFA like we are experiencing these days – and in Android too, if you’re not buying quality traffic to supplement those users – then you basically are just scraping the bottom of the barrel with another bottom of the barrel. You have no way of growing that. It’s lower than low. 

For me, whenever I’m looking at how to increase value in a business or looking at ad stacks or trying to figure out the right way to support a business, I’m always trying to understand the relationship between how much money you spend marketing, what’s your retention of those users because obviously if you’re consistently replenishing that first time user experience a lot – 100 grand a day and you’re buying quality users, this might not be such a big deal – but if you’re not buying that great quality and you’re not spending a ton of money, so you’re really impressing upon the same user base consistently over and over with the same types of ads, you run a huge risk of causing major detriment to your overall ads revenue.

John Koetsier:

This is huge. This is absolutely huge because you have cases – essentially a sad case of a game developer, an app developer who doesn’t understand that – and is desperately trying to monetize and is essentially destroying his or her ability to monetize by the very things that he or she is doing to try to monetize. And so …

Adam Jaffe:

I would say that it’s not a rule of thumb that says if it’s like this, it’s like that. And because the world of advertising is quite opaque, in fact, it’s …

John Koetsier:

Quite, hey? Just a little.

Adam Jaffe:

Just a little, you know …

John Koetsier:

How many servers did that ad go through before it came to my app? 1535!

Adam Jaffe:

You don’t know anything. You don’t know the CPMs of your own users. At best, you’re getting an average across the market for a period of time. Some mediation partners will say, oh, we give you user-level CPMs, which is great, although to be fair, you’re not 100% sure why that CPM was like that. 

Because of course, you don’t have the device graph. You don’t have access to a device graph to know that that player has gone on to do something else in this game, and we really want him. So there’s not even much you could even do with that information, other than to understand the amount of ads I should be sending to a user. 

I can’t even tell you what that is. 

I can’t tell you if it’s three or one or ten because again each user is different but I can tell you that the more ads that you send you’re going to hit a point of diminishing return and this conversation isn’t specifically about just blasting users with ads but I think it’s also about opening up yourself too. And I think a lot of companies also don’t necessarily realize this but you know mediation isn’t like you have one mediation SDK and then that simply is just there all the traffic goes through this and so you only have one SDK. No, you still have all of the SDKs that are sitting inside your app right, and so if there’s any issue with any of those SDKs it will break the waterfall and ironSource or MAX or whoever could detect that and move on to the next one. 

But there are other times where they can’t detect it and so you have the experience for instance like I experienced right where there was a bug in that SDK, which didn’t allow for an X out. I was contacted later by the CEO and he was saying, yeah, hey, you just caught us on an off day and we, it’s no issue and we’re trying to fix it. 

I see you laughing, so maybe you don’t believe that statement, but I believe that that was true. 

And so at the end of the day, I think companies aren’t necessarily aware and there are companies out there that kind of do this, checks and balances system … a pre-check to say, hey, does this app actually work? Will it serve an ad? Well, yeah, I got an ad for sure. So it works. And I think that’s probably the extent to which that technology kind of goes. Now, there are other ones that really look at it. They pre-cache the ad, and they check the X’s there. But again, if there are problems, the user suffers.

John Koetsier:

Yeah.

Adam Jaffe:

It’s always the user who’s suffering in this scenario. Right?

John Koetsier:

It’s a high speed business. There’s so many different layers to it. There’s so many different ways and things that can happen to an ad, an ad impression even happening. Many, many things can go wrong there. 

Okay. 

So there’s a lot of issues there. I want to get back to kind of where we started, where we have this experience in an ad that is not optimal. What is the solution to that? 

How do we fix that?

Adam Jaffe:

So I think it goes back to truly understanding your business and figuring out where your… where your users are finding real value in your product. And you can monetize that experience, right? And I think that’s ultimately what you’re trying to get to, right, hey, you ran out of lives, you wanna continue, you know, pay a dollar or watch an ad, you know, to continue this, you know, be a little jumpstart on that, want an extra boost or whatever. 

And I think if you consider that the ad, not as a simple monetization tool, but actually is a product tool, it’s a tool to allow a player an insight into an aspect of your product. That’s what adds, allow for. And if you approach it like this, then you wouldn’t just blast ads all across your product, right? Because you wouldn’t be looking at it from the product perspective. You look out for the monetization perspective. 

So I always try to get people to understand that ads are not a monetization tool, right? It’s a product tool to help you push users further in your game, to increase retention, to improve session length, to do all the things which your general KPI structure is meant to support and to have these view-throughs. 

Most companies, as I mentioned, have a different view and I’ll tell you the reason why.

John Koetsier:

But before you go there … if you have that mindset, if you have that mindset that ads are part of your product experience, then you’re going to be very cautious about who you allow into your product experience to deliver ads. And you’re going to have some parameters for who you’re going to allow in there. 

Now that’s complex as well. And picking is, is hard in a lot of cases, but you’re going to want to say to those people: the kinds of ads I want are these, the kinds of ad experiences I want are these. And if more product people and game developers had those types of conversations with more of the ad tech companies and the ad networks, we might get better experiences as well.

Adam Jaffe:

You know, I don’t know if this is actually true. I’m glad to tell this story. Somebody told me the story, and I don’t know if it’s true. But I always liked this. It actually happened in Vancouver, as I recall. 

But they came out with this thing where you could put a colored sticker on your mailbox, which would basically preclude you from getting spam mail. And so all these people put them up there, and then they saw that people were sort of taking them off. And the reason was that for some people, spam mail was better than nothing right?

I know this is a little bit of a weird tangent, but all of this technology exists you can call up any company Apple, Applovin, ironSource … whoever and you can go into their dashboards and you can blacklist advertisers I don’t want to see this stuff. I don’t want to see it. 

There’s a problem with that though. The problem is that you then hurt your own business.

 And we used to do that all the time, right? In the early days of ads, you know, when I was working with Facebook, I’d say, I don’t wanna see casino ads in my game, you know, that’s not what I want. I’m a casino product, I don’t wanna see DoubleDown, I don’t wanna see Big Fish Casino, right? It’s not what I wanted. So you would blacklist those products. 

And then you know what would happen? Your monetization would tank.

Why? Because those guys pay the most money for your traffic. They know your traffic is good. And so then of course it became this race but to make the best product. My product is better than your product, then you’re gonna just pay for somebody to watch your video. 

And I love this idea. Like, if your game sucks, then your ads are gonna work really well at driving players out of it. So it’s not necessarily a problem of not seeing the right stuff. It’s like your game experience sucks. You put that ad, you lost the level, and then you show me an ad and you’re like, yeah dude, I guess I’m out. This looks like an interesting game. So I’ve always …

John Koetsier:

Yeah, I buy that. I 100% buy that. What I was talking about more than who is in the ad or what the ad is advertising is the ad architecture, the ad infrastructure around that X button … around how long is this ad slot? 

Is this a playable that every time I try and play it kicks up SKOverlay? So I can’t play the playable because it’s interpreting every touch as a click ..

Adam Jaffe:

Technically, it’s not a playable. It’s probably just an ad. It just looks a playable … it would be cheaper to make something that looked like a playable than you could just click on that would bring you to the App Store.

Adam Jaffe:

I think you bring up a good point, John, and I think that’s ultimately kind of where we find ourselves, is that there really is no standardization at this moment. There used to be 15-second non-skippable ads and skippable ads. CPMs would be different depending on that, skippable again different types of CPMs because when I was buying media I’d say I want a 30-second non skippable ad … that’s more expensive.

But I feel like what ended up happening was that people realized that they didn’t necessarily have to differentiate. That they could charge the better stuff even because basically there was no differentiation – 15 second, 30 second, skippable, not skippable – that didn’t matter.

The reality is that you can bypass all of that just by what you’re describing right? You have the ad and the end card and the end card links to a thing and all of a sudden you’re like 45 seconds. You know we were allowed to skip it to the end card right and now from the end card … basically it literally won’t leave the screen until you x out of that right corner … so essentially so you could have that X not appear for 15 seconds.

John Koetsier:

Just to get to that point, the lack of standardization: I think that hurts the industry. 

Because if I know what I’m in for, when I accept to view a rewarded ad, I know the deal I’m making. And I’m more likely to make it. But if I don’t know, there’s some ads in the game that I’m currently playing most that are 15 to 30 seconds in, out, done, excellent. There we go, fine, excellent. 

Others are literally a minute plus a playable following them. And that makes me less likely to tap into that ad experience.

Adam Jaffe:

You are 100% true, and I’m going to say something right now that sort of throws a stick in the whole wheel of all this conversation is that is that nobody fucking cares. 

The reality is, is that you as a player, I care so little about you. Because this is one of these weird industries in which I don’t see my customers, I never meet them. If they have written a review, they might get a response, but most likely it’s not gonna happen. You know, we don’t work in a one-to-one relationship. 

We work in a one to … I need 50,000 people, right? And if one guy or 10 people, people have a bad experience … oh well. 

Most games, I mean think about it, like we released a version, we split test, half the population is going to get something that doesn’t work. Okay cool, we’ll just roll it back. Like that’s a pretty typical common response. We’ll just roll back the version, we choose the best performing one, we’re doing constant testing. 

I mean, you live in Canada. Not unfortunate because it’s not a beautiful country, it’s unfortunate because every game that’s released in Canada is essentially a soft launch of what it could be in America.

My point with this is that it is the marketing guys who have all the budget, the product has no budget. They’re the ones who make money, but they really have no budget. Whereas me, I’m the marketing guy. I got $150 million to spend. People want to listen to me. When I say, get me more traffic, and they’re like, how do we do that? He’s already paying the most. He’s paying the top CPM, his IPM, whatever, to find.

We’re not going to talk about creative optimization, because that’s not the purpose of this station, but okay, what if we just force people to click on the button or make that button a little bit harder or extend and so then they do a little test and oh, lo and behold, who’s super happy now? I mean, I’m like over the moon. Wow, what did you guys do?

How many times have I actually called publishers and been like, what did you guys do? That was amazing. How did you get me so much traffic? And they tell me something about some optimization or whatever. 

Now, that may be true. I’m suspicious now that I’ve worked in the industry long enough that it could have just been like … we had a bug and all of a sudden everyone who saw the ad had to click on it you know and that’s why you got all this traffic!

And so this is where we’re in a weird twilight zone type of moment where you need the ad revenue in most most cases to be profitable. 30% is often the difference also because it’s you’re getting a better margin generally speaking, and you need that for profitability. You have very little control over what’s shown. And you also don’t necessarily care too much as long as you’re making the money and you can sort of optimize that. 

It’s like, you know the game is rigged, but you’re playing it anyway, right?

John Koetsier:

Yeah.

Adam Jaffe:

I don’t know, I think the song goes, it’s like, you know, the dice are loaded, but I’m still rolling them, you know? Because it’s the only game in town, so I gotta play it. And I think that’s kind of where we find ourselves. There is no other alternative than to what exists. 

John Koetsier:

I have to keep some hope. I have to keep some hope that if you do actually care about the user experience, as we talked about initially, if you actually do care about users, and I know it’s hard to care about an individual because you have to deal in tens of thousands, hundreds of thousands of millions, billions in some cases, if you do care, that will be rewarding. 

I think there are some examples of games that do it well and do it right and keep users for literally years and those are primarily mid-core to hardcore. 

But I acknowledge the reality of what you’re talking about and that is just this is the world we live in. Churn and burn.

Adam Jaffe:

I wouldn’t say that it’s all doom and gloom, because I think that what I experienced in that game, in that moment, is something that a lot of companies just don’t have much visibility into. And so I wanted to mention what we were talking about before, which is that ironSource has come out with this system called ad quality. 

And when you update that SDK, you get to start to see which providers provide what level of click quality. Like, hey … this is the level of click quality. These were hasty clicks, people who clicked too quickly, which is less than five seconds, most likely that’s something a bit fishy. Here’s the people who thought they were clicking on an X button that they get redirected to and here’s the ones that were just auto redirects. You can see by publisher which ones are the ones driving this type of stuff and you can go down and see which ads. 

All of a sudden you get to start to see like, okay, this is interesting. I shouldn’t have, and I’m not going to call out anybody here, that’s not the purpose of this call …, but I think the end result is: visibility is good.

But I’m not a hundred percent sure that it might change much. 

Right … if a person sees it they might say: Hey, maybe I should be prioritizing that particular SDK the problem will be then they may suffer … they may not have enough fill for that particular market. Maybe that SDK is super good for this particular market or this segment of users in which their game happens to be strong? In which case they may suffer. So you take that with a grain of salt …

John Koetsier:

It actually would work if you have remnant, if you’re part of a large studio or conglomerate and you’ve got hundreds of games, and you can say, hey, remnant goes to cross promotion, right?

Adam Jaffe:

Right.

John Koetsier:

And then you can do that in a way that is super respectful and super useful from the end user, the game or the player perspective. 

I’m not sure we’re solving this world, but I do like that look at ad quality. And part of that would be, and I don’t know how much data that SDK can collect (and especially I don’t know when Privacy Sandbox for Android comes in and SDKs are going to be basically firewalled in a location where they can’t grab everything) but you know, if I’ve got a video ad and somebody says, okay, I’ll watch the ad, puts the phone down, does something else, right? 

That would be interesting to know: is the phone moving? Is it flat and level? You know, because we always move a little bit when we’re holding our phones. I don’t know if you can get that level of information and what, where you cross the creepy line as well. So there are lots of issues there, but knowing …

Adam Jaffe:

I think it’s, you know, I’ve worked in gaming for a long time. It’s coming up on like 17 years now. And the thing that I’m always sort of shocked at is like when I meet people who are like, it’s, you know, they get so deep into like what you’re describing, you know, the, you know, the tilting, the thing that, and I’m always like, cool, man. 

Like I like that somebody’s out there thinking about that stuff because 99.9% of that doesn’t matter. It just has no practical implication. 

What are you gonna do? You’re going to say, hey, we see that that phone has been put down when I give you your reward. You know what that’s going to do? It’s going to nullify that entire experience. Not just for that player, but for every player. 

John Koetsier:

You can’t not give the reward, but you can report it to the company that’s paying for the ad.

Adam Jaffe:

Yeah, but so here’s the problem with that. And again, this is where this whole thing, it’s the same company who’s paying for the advertisement, who you’re gonna report it to, right? So you’re like, I’m company A. 

So I get a phone call from the people who are also running ads in my game and saying, hey, that money you’re spending isn’t really, so sorry, so …

John Koetsier:

You paid for crap. And I have more crap to sell you tomorrow.

Adam Jaffe:

Here’s the problem, here’s the biggest issue, right? Who would call you in this scenario? IronSource would call you and say, hey, by the way, just want to let you know all that traffic we sent you, well, actually they didn’t even do anything so probably shouldn’t have to pay us.

I guess what we already paid those guys for those impressions so … sorry actually you had to pay for it even though …

John Koetsier:

It’s almost like we need a measurement partner who kind of doesn’t care who gets paid. I can tell you what traffic caused the most actual impact and conversions. It’s almost like, you know, this, this podcast might be by a company that does some of that. 

But I get your point.

Adam Jaffe:

But you know what I’m trying to say is that the problem is that it’s a bit, you know, the lights are off, man. The lights are off and the person who potentially could be in charge, and by the way, I would never advocate for them to be in charge, and as a business owner, I would never do what I just described. 

I wouldn’t call the person and be like, hey, by the way, that quality is not so great. I mean, hell, you don’t want to have to go into device graph manipulation. But it’s a big reason why we’re in this position of IDFA deprecation to begin with, because companies could mix and match and fraud and do whatever they wanted. 

And game developers knew nothing. It’s OK, I got paid. Or on the other side, if I told you now, John, you want to buy media for me, and I tell you, OK, CPI is actually $35. But yesterday, you told me it was $2. You’re like, well, it is $2-ish. But if you want to pay the real price, without any of this malarkey, it’s $30 and people go … yeah my board won’t accept that.

Why would I do that? I would literally just because that guy telling me $2 and like yeah well that guy is also sending you 500,000 clicks and 15 installs. Where do you think those clicks are going? Who do you think those people are? So that in the end is this thing that we’re up against and I feel like …

John Koetsier:

And you have just described the adtech ecosystem, where you’ve got people who want everything for nothing and people who wanna give you nothing for everything. And somehow in between, its sort of kind of works out. 

Adam Jaffe:

I do think that if more game developers are calling these guys out as I did, then you will see something happening. If Zynga were listening and they were listening …

John Koetsier:

There were people from Unity who pinged in on that. I’m not going to name the company that you particularly called out there, but I suspect they reached out.

Adam Jaffe:

The CEO reached out to me and so did a few board members and a few other people that I knew and they said, hey, what’s going on man? They thought I had something against them and I was like, no, it’s not a personal thing. As I say, I love ads. I’m a huge proponent. It’s like the first thing I’m looking at. How can we put more ads in your game? These things are things which go unseen.

Adam Jaffe:

By the way, it wasn’t like that company all of a sudden was sending an email to that other company I was working with and saying, hey, by the way, we’re really sorry, our SDK introduced this bug which had this inability to click out of an ad. 

John Koetsier:

Yeah, yeah, yeah.

Well … what we have done is we’ve kind of pulled back the curtain a little bit today on some of the things that go on in between all the competing industries in the mobile gaming industry. It has been a lot of fun. It’s been somewhat depressing. There’s also a ray of sunshine there. There’s light at the end of the tunnel. And that is hopefully …

Adam Jaffe:

You know, it’s the only game in town, so everyone’s playing it. So, you know, it’s like, if you want to be in it, you got to just sort of be in it.

John Koetsier:

In it to win it, obviously. Excellent, wonderful. Adam, thank you so much for this time. It’s been really enjoyable.

Adam Jaffe:

Thanks, John. It’s been a pleasure.

iOS alternate payments: court tells Apple not to block alternate payment messaging

Apple just won another round in the antitrust case Fortnite-maker Epic brought against its App Store rules, but it didn’t get everything it wanted. The significant exception: apps should be allowed to tell users about iOS alternate payment options. This is a huge deal for games with heavy-spending “whale” players and apps with significant subscription charges.

The relevant App Store guideline

App Store guidelines currently have a stipulation against telling users about alternate ways to pay for in-app purchases. It’s in section 3.1.1 — “apps and their metadata may not include buttons, external links, or other calls to action that direct customers to purchasing mechanisms other than in-app purchase” — and it applies to all apps except “reader” apps such as magazines, music, books, and streaming video.

Legally, this is called “anti-steering.”

As things sit legally today, that will have to be changed.

The court’s ruling on iOS alternate payments

Here’s the relevant part of the ruling by the Ninth Circuit Court of Appeals court:

“The court then applied the [Unfair Competition Law] to Apple’s anti-steering provision. The court found that Epic is sufficiently injured to seek injunctive relief because Epic is a competing games distributor and would earn additional revenue but for Apple’s restrictions. On the merits, the court applied the competitor-suit ‘tethering test’ and consumer-suit ‘balancing test’ and found the anti-steering provision to be ‘unfair’ pursuant to both. The court concluded that Epic satisfied all the requirements for injunctive relief and the nature of Epic’s injury warranted an injunction preventing Apple from enforcing the provision against any developer.”

That’s pretty clear: telling app users about other ways to pay for in-app items cannot be enforced. Which means you could provide a link to a web store to buy IAPs.

What this means for games and apps

If you’re a game publisher and you sell items for $1 to $5, not much is likely to change. But if you’re a publisher who sells in-game items for $30 or $50 or $150 — and there are many — you could now tell players that an item is $100 in-app via Apple’s purchasing methodology, or $80 online on your app’s web store.

Users save money.

Publishers potentially make more money.

Everyone wins … except Apple.

This won’t be interested for small payments. It’s extra work and hassle for players, and that’s hardly worth it to save 30 cents or a couple of dollars. It’s also guaranteed, as another step in a purchase funnel, to incur some drop-off. Some percentage of people will get distracted, think twice, have a problem with the e-commerce functionality, or otherwise fail to complete what would otherwise be a single tap-plus-confirmation purchase.

So marketers need to be cautious here.

But if you have a sufficiently compelling offer to your players — enough of a discount or benefit — it’s probably going to be worth it to try. Once they’ve set it up, it should be seamless. And surely there will be stores set up by white-label services that you can simply drag and drop into your workflow.

For non-game apps with subscriptions or large purchases, the same applies. An app with a $150 or $300 annual subscription will have plenty of incentive to set up alternate forms of payment and collect a larger percentage of users’ payments. The same caveats apply, of course.

Your user is (now) your customer

Another massive benefit: your user/player/subscriber is now your customer, not Apple’s. You now know your customers and have a one-to-one commercial relationship with them, including email address, credit card information if they choose to save that with you, and all the other benefits. Upsells become possible. Cross-promotion. A level of platform independence.

But this benefit of iOS alternate payments comes with caveats.

There’s likely some customer support to deal with. Some refund processes to figure out when a customer’s kid buys $5,000 worth of in-game goodies. Security and personal information handling considerations. Legal considerations around privacy.

The extra revenue you’re looking at acquiring could end up being very costly.

But wait, Apple could appeal

An Apple spokesperson told The Verge that “we respectfully disagree with the court’s ruling on the one remaining claim under state law and are considering further review.” So Apple has a chance to fight this issue, if it chooses, all the way up to the U.S. Supreme Court, Ars Technica says.

That’s probably unlikely.

I think Apple’s reading the tea leaves in the EU’s Digital Markets Act and the UK’s draft legislation on providing more powers for its Digital Markets Unit to stop anti-competitive behavior, which many think would include a close look at how app stores are being run by major global companies. Also, two courts now in this ongoing Epic v. Apple battle have rules that the anti-steering provision for not telling customers about alternative payment methods is illegal. Any challenge to the Supreme Court would have to overcome this weight of precedent.

Then there’s the Netherlands and Korea, and probably other countries who are trying to force Apple to open up payments.

This horse is likely out of the barn.

Move slowly on iOS alternate payments

There are definitely already games and apps that have chosen to quietly circumvent Apple’s guidelines and risk punishment. Publishers of these games will now be emboldened to continue.

For others, take a few deep breaths and wait for updated guidelines from Apple. Apple will probably take a few weeks to consider whether an appeal is likely to succeed before updating the App Store Guidelines, and it’s better to stay on the side of the angels than risk punishment.

And who knows? Maybe in a year or two there will be multiple app stores on iOS.

Multiple app stores 2025: welcome to the multiverse of marketing

It’s 2025. Welcome to the multiverse of marketing on iOS with multiple app stores, perhaps even too many to count. You had close to 400,000 reported new installs — most of which are fake — across 167 different app stores that you bother to track and better than expected D7 ROAS of 10% across all marketing efforts.

multiverse-of-marketing

Some highlights:

  • Mr Beast is roaring
    A recent $50K activation on Mr Beast’s app store is showing real promise with strong pick-up and outstanding D7 revenue
  • The original App Store is king
    The original Apple App Store is still your major source of monthly average users
  • Facebook loves data
    Working on 100% first-party data, Facebook returns to ROAS supremacy 
  • 157 flavors of fraud
    Over a hundred app stores are telling you they’ve supplied you with over 350,000 new installs and want your ad dollars to make it even more. But your MAUs with these fly-by-nights total just a miniscule 3.

A brave new world of mobile app advertising

We’ve talked about it before. The European Union’s Digital Markets Act is an attempt to open up competition in app stores, and it’s likely to be just an early warning wave in a coming tsunami of global legislation demanding the same from both Apple and Google.

Google has plenty of experience with third-party app stores thanks to China, India, and global competitors like Samsung and Amazon.

Apple, not so much. There are third-party app stores for iOS like BuildStore, AltStore, EonHub, CokernutX, Cydia, Xabsi, and more. But none of these app stores have really hit the bigtime. None of them are top of mind for a significant number of iPhone owners. And many of them, like iOS Haven, offer “tweaked, modded, and covert” apps. In other words, games that don’t require payment for IAPs, apps that do things their designers and developers never intended, and — most importantly — apps that can’t really be fully trusted by end users.

But by 2025, we’re likely to have multiple legally available and commercially interesting app stores.

Amazon is a no-brainer. So are Facebook and Google, who can take advertising, sales, and analytics all in-house, completely removing the sting of App Tracking Transparency and operating on their own rules in an earned and owned first party data platform.

All of it means much more opportunity for mobile advertisers to take advantage of, along with much more complexity for mobile advertisers to manage. Amazon has a different audience than Facebook. Massive influencers have their own demographics, and a Mr Beast is big enough to spin up an influencer-focused white label of an app store platform that rabid fans would likely embrace.

Just think: the Mr Beast lifestyle, the Mr Beast app for this, the Mr Beast app for that. Other big brands — think sports leagues like the NFL or NHL — already have “official” brand partnerships. Their own app stores would be just one step farther. This new world really starts to make sense when you go global, and you work with a big brand in Germany versus one in Nigeria versus one in South Korea and yet another in Australia.

Now marketers have the option to target specific audiences based on their affiliations. 

But now marketers also have to gather data from dozens or even hundreds of different platforms to get a holistic picture of their global performance.

Multiple app stores: A brave new world of mobile app management

Of course, it’s not just marketers who get all the fun. Developers will get more than their share as well.

Different app stores will have different requirements. Different approval processes, both automated and manual. Some might sign lucrative partnerships that privilege one specific app or game in a category, and potentially even prohibit competitors from publishing their apps on the same store.

They’ll have different marketing strategies, ASO opportunities, search and discovery pathways. They’ll have different commissions, costs, and internal ad networks for promotion.

And shocker: they’ll also have different reporting.

Being able to assemble data from all these different outlets will seem familiar to old-school marketers in physical retail or multiple digital storefronts, but that won’t lessen the pain of aggregating and normalizing and standardizing all the different data points.

Developers won’t have to just navigate app submission requirements, but also updates, payments, notifications, refunds, reviews, and more. It will be a significant effort for each new app store, potentially, and it won’t be limited to app stores you choose. Many upstart app stores will look to grab apps and games off other stores and add them to their virtual shelves to bolster their own value proposition and revenue opportunities … and they won’t stop to ask permission.

Multiverse of madness: app fraud in so many new ways

App marketers know all about ad fraud that steals their ad dollars and shaves their ROAS margins, but it’s mostly Android developers who feel the special pain of hijacked or stolen apps marketed under different names in small, regional, or underground app markets.

Not to mention the blame they get when a hacked app does something nasty to an end user who then blames the original publisher.

With multiple app stores, iOS will join that party, and publishers will need some form of the always-popular (yes, this is sarcasm) digital rights management to ensure their apps aren’t stolen, altered, or hijacked in any way. Nothing they use for this, of course, will be 100% effective.

Multiverse of marketing: MMPs for sanity

All with aggregating all the various types of data from each platform, MMPs will also need to support and build integrations with app stores that matter. 

Which, of course, could number in the dozens or hundreds, and which might implement their own type of digital advertising identifier, or provide no means for any marketing measurement whatsoever. And which, also of course, will need to operate in an iOS environment where Apple grudgingly tolerates them for legal reasons, if at all, and locks down iOS in new ways to protect against a more open (and more vulnerable) ecosystem.

Which will make MMPs even more essential.

MMPs already have to integrate with thousands of ad partners, but they’ve only had to connect with two major app stores. Now, likely, the ad-mediated nexus between consumer demand for apps and platform supply of those apps likely becomes much more balanced, with hundreds of app stores taking up the role of supply ads for iPhones. (And, of course, Android as well.)

A big question: consumer uptake

The current system is simple. It’s trusted. It’s safe: one place to get apps, no thinking, no pre-installing of a new store, no wondering if you trust a new app store with your credit card, and all payments coming from one brand.

So it’ll be a big change for iOS users (and most Android users) to get apps from multiple places.

Once they start, though, it might just open the floodgates. And that will be a massive change to an industry that’s already gone through ATT and will have just made the GAID to Privacy Sandbox for Android switch.

It’s the new multiverse of marketing, and it won’t be easy.

SKAN 4 transition early days: not even 1% of iOS installs using SKAN 4 measurement right now

The SKAN 4.0 transition is definitely starting, but perhaps not yet at Formula 1 pace. Fewer than 1% of all iOS postbacks are SKAN 4 postbacks right now. And only 7 of the thousands of ad networks and platforms that Singular measures are actively adopting SKAN 4 at this point in time. 

Still, now is the time to get your SKAN 4 conversion models set up, for a number of reasons:

  1. SKAN 4 is completely backwards compatible with SKAN 3
  2. SKAN 4 is incredibly easy to set up
  3. SKAN 4 is going to only see increased adoption: bid requests are hitting almost 20% and growing fast

Let’s see what’s happening on the technical side …

SKAN 4 transition: what’s happening

Most ad networks and platforms are testing the last version of SKAdNetwork for their ad inventory. That’s why Inmobi’s DSP  is seeing over 19% of bid requests come in as SKAN 4 compatible as of April 2023 … a massive change from less than 2% just 4 months ago.

Some data that Sara Camden, InMobi’s head of product marketing, shared with me:

SKAN 4 transition

But it’s worth reminding ourselves what’s required to get a SKAN 4 conversion.

SKAN 4 conversion

You need:

  1. A SKAN 4 ready device running iOS 16.1+
  2. A SKAN 4 capable SDK from Singular or another MMP
  3. A SKAN 4 conversion model set up and running
  4. A SKAN 4 click, which requires the ad network’s set-up

Miss one of the required elements, and you get SKAN 3 postbacks. (Note: you can get SKAN 4 postbacks without having set up a SKAN 4 conversion model, but you’ll only see the first postback because SKAN 4’s second and third postback won’t have been set up.)

So the ad networks are (mostly) setting up, testing, and preparing. But now we need advertisers to also start setting up, testing, and preparing … which of course they haven’t been able to do until very, very recently.

Low numbers of SKAN 4 postbacks so far …

The result is predictable: very low numbers of SKAN 4 postbacks, with a few spikes as ad networks ramp, evaluate, and then pause testing efforts.

This is Singular data from January to the first week of April:

SKAN 4 adoption pace

Currently, SKAN 4 is seeing a .2% adoption rate when we look at all the variables: a SKAN 4 capable device with a recent iOS version, a SKAN 4 click from an ad network, and an active SKAN 4 conversion model from an advertiser. The spike in the graph above drives the percentage temporarily to almost 2% as one large ad network ramped up testing.

SKAN 4 transition: Time to pick up steam?

What we essentially see now is that many ad networks are starting to get ready. Ad networks that we see testing SKAN 4 recently include ironSource, Moloco, Smadex, Unity Ads, Appier, and Google AdWords. We’re also seeing “ad networks” that are essentially large publishers’ internal cross-promotion efforts testing SKAN 4 capability, boosting the SKAN 4 transition numbers.

Interestingly, the ad network that caused the spike in the chart above ran 86% SKAN 3 clicks and 11% SKAN 4 clicks in the second week of March (plus a few SKAN 2 and some null SKAN models to make up the 100%). By the beginning of April, that ad network was 97% SKAN 3.

In other words: there’s testing, evaluation of results, and then a pause. But also, ad networks need advertisers to jump on the SKAN 4 train and get conversion models set up so that they can evaluate the entire loop and advertisers can provide feedback on the results.

One reason to set up your SKAN 4 conversion model today is that it doesn’t impact any active SKAN 3 campaigns, as long as your SKAN 4 first postback conversion model is aligned with your only SKAN 3 postback conversion model. Additionally, as there’s increased ad network adoption of SKAN 4, you’ll start seeing the extra data from postbacks 2 and 3 show up in your dashboard … data that you’ll miss out on if you only have a SKAN 3 conversion model active.

Need some help getting up to speed?

You’re in luck. We’ve put together a complete SKAN 4 transition guide that highlights the changes, lists the strategic decisions you’ll need to make, and gives you a suggested plan for how to set up your SKAN 4 conversion models.

Get it for free here.