User acquisition 2023: 12 insights from 5 mobile experts

How will user acquisition change in 2023? 

We gathered 5 mobile experts in our most recent webinar to answer that precise question. The sad truth for all mobile marketers exhausted by all the ecosystem disruption in 2022? Everything is probably going to continue to change, and likely at an accelerated rate. (Sorry!)

Those experts include:

• Matej Lancaric, UA consultant
• Omer Gerzon, Director of Marketing & Growth @ PlayStudios
• Emre Bilgic, Apple Search Ads Client Partner @ MobileAction
• Yash Patel, General Partner @ Telsta Ventures
• Gadi Eliashiv, CEO and Co-founder @ Singular

All had great insights on the future of mobile marketing and user acquisition in 2023. Each sees from different angles depending on what they do and how they observe the mobile ecosystem and its challenges: 

• Adapting to privacy regulations and realities
• Recession
• Post-covid adjustments in the economy and in people’s lives
• SKAN 4 and Privacy Sandbox next year
• The crypto meltdown and its impact, if any, on web3
• The (still happening) supply chain issues
• War in Europe
• Technological change in the form of Meta and VR, AR, MR

More on what to expect, and what their advice is for marketers, in a moment.

First: what mobile marketers think right now

We asked the hundreds of marketers in the webinar some key questions, including what their top advertising challenge of 2022 turned out to be. The perhaps not-so-surprising answer? 

Privacy.

Technically, the recession and SKAN 3 tied as the top challenges in 2022, each with 31% of the vote, while planning for future privacy changes in SKAN 4 and Privacy Sandbox for Android trailed with 21% of the vote. But let’s be real: SKAN 3 and planning for future privacy changes are both about privacy-driven changes in mobile marketing. Add them up, and you get to 52% of the vote.

We also asked about marketing budgets for 2023.

In the current climate with plenty of talk of recession and doom and gloom, it’s easy to assume that user acquisition budgets will be down in 2023. But according to mobile marketers and what they know right now, that’s not going to be the case.

While 9% of advertisers said they’d spend less in 2023, 54% said they would not reduce marketing spend next year. 37%, however, said they simply didn’t know yet whether advertising budgets will be up or down.

Those numbers offer grounds for cautious optimism both for people in the mobile adtech space and for those who depend on advertising for mobile app monetization. 

Finally, we asked about SKAN 4.

SKAN 4, of course, is a massive new release of Apple’s SKAdNetwork framework for mobile attribution, and offers new capabilities for more post-install conversion data, for web-to-app marketing journeys, and for additional creative optimization, among other things.

But marketers aren’t quite sold yet on its benefits. Or at least its cost/benefit ratio.

Only a quarter of mobile marketers think that SKAN 4 will significantly help user acquisition managers in 2023. Almost a third think it just won’t, period. And almost half simply don’t have enough information yet to decide whether it will or won’t.

Marketers just don’t know what to think yet, apparently. Which means that Apple — and marketing analytics companies like Singular — need to up their game on explaining SKAN 4 and implementing it in a way that makes it easy for marketers to adopt it and understand the benefits of it.

User acquisition 2023: what to do and what to expect

1. Go beyond D7 campaign performance

Matej Lancaric says a major mistake of 2022 to not repeat in 2023 is to view D7 performance as the holy grail of user acquisition performance.

“Not looking past D7 … is definitely dangerous and, in my opinion, definitely wrong.”

Some users take time to produce value. Some channels are better over the long term. It’s challenging when you want immediate insights — and you can certainly learn the signals of future value in each app over time — but D30, D90, and even D180 performance is really important, especially in subscription apps, and especially in high-value verticals.

2. It will no longer be OK in 2023 to lose money

It’s probably shocking to some, but there were many companies that were very comfortable losing money in early 2022. And there were also issues with the accuracy of life-time value calculations and customer acquisition cost numbers.

Why?

Free money.

“There was very fuzzy, optimistic math around LTV/CAC ratios,” says Yash Patel. “It was okay to lose money as long as these companies were growing 2X to 3X year on year because you knew you had a lot of late stage investors and equity market investors that would eventually foot the bill.”

With low interest rates and plenty of venture capital looking for companies to invest in, some companies lost discipline on acquisition cost and put rose-colored glasses on for their LTV projections. Now interest rates are higher, and VCs are much more careful.

3. Web and desktop are not dead

Mobile is where everything’s at, right? Wrong.

“We saw a lot of success with companies that launched web and desktop based experiences and saw higher retention rates and better user acquisition ROI as well,” Patel says.

The benefit of having a VC who invests in the mobile space on a webinar about user acquisition in 2023 is that you get a big picture global view. And part of the interest in web-to-app and app-to-web customer journeys and user acquisition flows is that there’s additional opportunity at sometimes-lower costs.

And, of course, not all your customer acquisition or player acquisition has to be for mobile. Some of your experiences can live on the desktop too.

4. Delaying SKAdNetwork learning and implementation will no longer be an option

Probabilistic matching is going away, says PlayStudio’s director of marketing and growth Omer Gerzon. And it will longer be a viable option to avoid learning SKAN.

“I hear a lot from other advertisers that are … saying, ‘I don’t need to deal with SKAN today. I will wait for the moment that SKAN will be forced on me,’” says Gerzon. “It’s not going to work for you. It’s just not going to work for you. SKAN is complicated. It’s complicated to understand. It’s complicated to understand how it works initially and it’s hard to run those campaigns.”

While it’s hard, some of the greatest success PlayStudios has is thanks to internal knowledge that the team has built around SKAdNetwork, Gerzon says.

And that’s becoming a competitive advantage that is more and more important.

5. Don’t underutilize Apple Search Ads

Apple Search Ads is both huge and hugely effective. We’ve always known search is a key avenue to enable relevant advertising thanks to the way it naturally surfaces intent, and doing that right where you can actually convert and install an app — and where you feel most comfortable doing so — is why ASA makes sense.

“Most marketers were underutilizing Apple Search Ads in 2022 despite all of the new placements that were coming out,” says MobileAction’s Emre Bilgic. “The biggest marketing wins for all of our partners have been utilizing the custom product pages that came out throughout the previous year … basically allowing us to match the messaging and the imagery that we have through the product search [and]  just making the experience for the user more relevant.”

That improved overall tapthrough rates and conversion rates, Bilgic says. And the vast majority of marketers, he adds, have never used it. Many — 60% of the mobile marketers he’s talked to — haven’t even heard of it.

Properly utilizing custom product pages is going to be one of the biggest wins in 2023, Bilgic says.

6. Leverage the galaxy for Android wins

This might be one of the best-kept secrets in mobile marketing: use third-party app stores for big user acquisition gains in 2023.

At least, use one of them:

“The Samsung Galaxy store actually was a good way to drive Android downloads,” says Patel. “And it touches about 34% of the U.S. population.”

Do I sniff a hint of a blue ocean, a competitive backwater that avoids the hyper-competitive red ocean of Google Play and provides an opportunity for potentially cheaper Android user acquisition? Definitely something to try in 2023 for your Android apps.

7. Story-telling is the new targeting

Targeting is gone. 

Whether that’s due to black boxes at Facebook or Google, or due to privacy shifts like Apple’s App Tracking Transparency or the coming Privacy Sandbox for Android, the way mobile UA marketers target users is massively changing.

PlayStudios’ marketing chief Omer Gerzon suggests story-telling is the new targeting.

“The new targeting — or actually the old targeting — is just to tell your story right because eventually, if you look at the most traditional marketing way to reach the audience that you want to reach … is just to tell your story right.”

This sounds crazy soft and brand-focused and la-ti-da for hard nosed performance marketers, maybe.

But using the right creative and messaging to ensure the right kind of users — the ones who will be high-value — notice your ad and install your app is genius. It’s a mix of using whatever targeting you can by channel, partner, and context, and then applying a mass marketing strategy to narrowcast to specific audiences within the crowd.

8. Events are the new targeting

Stories are great, and they work. To optimize ad campaigns in real-time, you also need signals. Matej Lancaric suggests those are events.

“I think we are moving … towards event-based targeting: event meaning anything that you can actually capture from your game and then send back to the UA channels … the first 24 hours for you to maximize the number of events you can actually get and capture from your players … and then send it back to UA channels and then optimize your campaigns based on those events, that is basically the new targeting. It’s going to happen. It’s already happening to a certain extent.”

In other words, bring in users.

See what key events happen: events that signal monetization. Send those back to user acquisition partners. Tell them you want more like that, and let them sort out how to find and get them.

Targeting, circa 2023.

9. Look deeper into your funnel

Gerzon essentially agrees with Lancaric on going beyond D7. In fact, he thinks that going deeper is going to be one of the major changes to user acquisition in 2023.

“The main change for most advertisers is going to be the ones that are more looking at deeper funnel events or optimization,” Gerzon says.

In other words, drop the clickbait ads. Ignore easy top-funnel wins like CPI or install rate. Focus on engagement and retention and all the things that happen deep down in the funnel. And really work with product to optimize user experience and onboarding.

10. Grab more granularity

We lost the age of granularity when the IDFA walked out, right? Sure, but not so fast …

“The good news is that next year with SKAN4, at least in theory, you should be able to get more granularity on your down funnel events,” says Singular’s CEO Gadi Eliashiv. “More granularity is good news.”

Learning SKAN 3 now is smart, because it sets you up better for SKAN 4. And deeply understanding how to use SKAN 4 will optimize the amount of insight you can derive from user acquisition campaigns.

The other good news: the mobile ecosystem is coming to your help.

“There’s probably 1,000 people in Meta working on optimizing their ads engine because it’s the biggest revenue driver,” Eliashiv says. “They’ll find ways to use those bits that will make their way to advertisers.”

And not just Meta. 

Google as well, and all the other titans of adtech that you might partner with.

11. Embrace multiple measurement methodologies

Mobile marketers might be able to get some of their missing granularity back. But what’s not coming back is the sole reliance on IDFA for ROI, LTV, CAC, optimization, retargeting, and basically everything else in mobile marketing on iOS. And GAID on Android is going the way of the dodo as well.

What’s replacing it?

Hybrid measurement.

“Now you need multiple methodologies to understand what’s going on,” Eliashiv says. “You’ll find yourself where you’re not just using one method anymore. It’s gonna be a combination of tools that you use for different purposes.”

First-party data? Sure. Consented IDFA? Yes. Partner viewability, delivery, and cost data? Absolutely. And media mix modeling or marketing mix modeling as well.

And, of course, the frameworks from major platform owners:

“Buckle up for SKAN 4.0 and Google Sandbox and the privacy changes,” Gerzon says. “This is the future of measurement. Don’t be afraid of it. Just embrace it and start working on it if you haven’t. All the traditional targeting and measurement is going to fade away.”

12. Embrace generative AI for mobile marketing

What are the biggest game changers going to be for mobile marketers in 2023?

One just might be generative AI, says Patel.

What for?

Testing, images, ads … pretty much everything.

“Using generative AI to scale AB testing in terms of creatives and ad performance across a whole bunch of channels,” will be a major difference maker, he says.

So go get your Stable Diffusion, your ChatGPT, your MidJourney, and all the other tools. And expect some generative AI startups that are laser-focused on delivering the benefits of these tools specifically in a marketing and advertising context.

So much more in the full webinar

As usual, I can only excerpt a few fragments of the value in a full webinar in a recap post. Go check out the full on-demand webinar here to get all the insights from the experts we assembled.

If you’re taking some time off around the end of year holidays, this is a perfect time to cue it up, grab a drink and a snack, and chill out to enjoy the show.