What is Mobile Ad Revenue?
Ad revenue generated from mobile apps through various forms of in-app advertising is one of the most popular monetization methods for app developers. There are other forms of monetization available to developers such as in-app purchases, but mobile ad revenue has become an increasingly important part of building and growing an app business. Since there are multiple ad formats and ad networks available to app developers, accurately measuring and optimizing ad revenue across each platform is essential to understanding the value and ROI of each person using your app or playing your game.
Unfortunately, tracking mobile ad revenue is more challenging than it sounds without the right tools and technology in place.
How to Maximize Mobile Ad Revenue
Unlike in-app purchases where you know exactly what people are buying, mobile ad revenue is typically calculated in bulk. IAPs are tied to individuals; ads are sold to groups or aggregated audiences.
As discussed in our guide to mobile monetization, in order to generate ad revenue, publishers and developers rely on ad networks and mediation platforms, which each provide different analytics at varying levels of granularity. As a result, understanding the worth of an individual user and even your overall revenue is much more challenging with ad revenue than in-app purchases. This challenge is further escalated when you’re dealing with revenue from multiple ad platforms and acquiring users from several sources.
Simply put, calculating mobile ad revenue is also not as simple as multiplying eCPM (effective cost per thousand) by ad impressions.
Adding to the complexity of ad revenue and revenue tracking is the multiplicity of ad formats available to publishers. Of course, the typical ad forms such as banner ads, interstitial ads, and offer walls are still important, although many mobile marketers have said that video ads are their most valuable monetization method. In particular, a survey from AdColony highlighted on eMarketer says that 75% of publishers rated video ads as their most valuable and effective technique for monetizing mobile apps. These publishers also stated that video ads offer users the highest quality user experience, making them a win-win for both parties.
As Lisi Gardiner, a Singular product manager highlights, optimizing an ad monetization strategy is more complicated than it sounds:
“Which ads do you want to show? Which networks do you want to work with? What mediation platforms do you want to work with? When do you show an ad? What is the value you expect to get for showing that ad? Which countries are you optimizing?”
In order to calculate ad revenue, you would think it’s as simple as adding up the revenue from each ad network. That can provide a total, but it does not give app publishers a complete picture of their profitability because it’s not connected to each individual or cohort of people and the cost to acquire that app user or cohort. Instead, in order to maximize profitability app publishers need to understand how much they’re making per user or cohort. By calculating per-user ad revenue data, mobile marketers can then understand the relationship between their customer acquisition cost (CAC) and their revenue, yielding profitability.
Since this per-user ad revenue data is not provided by ad networks, many mobile app publishers turn to third-party marketing analytics and attribution providers like Singular.
How Singular Calculates Mobile Ad Revenue
In order to improve ad revenue tracking and reporting, Singular collects data on the average revenue per session at the cohort level. This means that app publishers know exactly how much revenue is being generated from each new cohort of users. Singular also connects to various ad mediation platforms such as Ironsource, ApplovinMAX, Facebook, Soomla, and Admob in order to provide publishers user-level data on the ad revenue generated from each network.
In addition, Singular integrates with the in-app monetization platform MoPub in order to provide publishers with revenue data at the ad impression level. By combining data from multiple sources and aggregating it into a single dashboard, this gives publishers the most accurate user-level data from all revenue sources.
In summary, by providing mobile marketers with a complete picture of their ad monetization analytics, they’re able to easily uncover insights and find new opportunities to optimize the monetization of their apps. By automatically collecting, normalizing, and aggregating this ad revenue data, app businesses are able to increase their ROI and maximize profitability.