Real-time bidding explained
Posted Jul 29, 2014
Trademob’s Chief Product Officer, Dr. Matthias Schoen gives us an update on what mobile real-time bidding (RTB) is, best practice on RTB and why you should pay attention.
Mobile real-time bidding (RTB) is a type of automated buying of advertising placements. It is the next big thing hitting mobile in-app advertising and has been likened to the high-frequency trading on Wall Street.
Over the past 18 months RTB has significantly ramped up for in-app traffic with an increase in inventory over the last six months of 210 percent. This development has been triggered by big AdExchanges such as MoPub, Google AdX and Nexage moving into this field.
For advertisers the emergence of mobile in-app RTB allows a more direct interaction between an app developer and its user base. It offers advertisers direct control combined with full transparency of their pricing strategies for mobile retargeting, and their publisher selection and choice. Advertisers are also able to directly address specific audience segments and RTB gives them flexibility to combine different ad formats to reach them.
Because complex datasets are automated, advertising techniques such as retargeting can easily be done in real-time, allowing for higher campaign efficiency and a dramatically increased ROI.
Conversion rates and KPIs for retargeting campaigns compared to new acquisition campaigns vary across different verticals such as e-commerce, travel, classifieds. However, all verticals have shown outstanding results.
We’ve already seen four to six times as many in-app purchases compared to classical user acquisition campaigns (app download campaigns) with up to 300 percent higher conversion rates compared to display advertising and 95 percent lower cost to re-engage a dormant user through retargeting than to acquire a new one.
Our campaigns so far have also shown that 77 percent of returning users are more willing to make a purchase than new users so it certainly makes economic sense to look into retargeting.
When using RTB, advertisers need to clearly define what they want to achieve and if their provider has all requirements for success, namely global reach, cohorting, flexible ad display and full automation.
For those who are starting out with their first RTB retargeting campaigns, I would recommend working together with an experienced mobile demand-side platform (DSP) and attribution provider as they can provide guidance and help you make the right decisions.
There are several things to think of such as user lists, territories, URL schemes, and hundreds of possible banner formats, to name just a few. You’ll probably want to start out with a little A/B testing and this should also be programmatic – it is all about efficiency.
Your provider should be able to offer real-time optimization based on fully automated programmatic buying algorithms. I always advise optimizing towards individual, cohorted KPI targets and not just CTR.
Experienced marketers who are satisfied with their ROI should then focus on how to efficiently scale. This is all about achieving more volume without sacrificing ROI.
Since mobile RTB is still new, experienced marketers can be innovative and take calculated risks through testing new formats. For example, we were one of the first companies offering native ads via our DSP.
Programmatic advertising is currently rising with enormous speed on mobile and I expect this to continue. For example, in the US there have been a lot of mobile DSPs that have been founded in the last 18 months – all with a different focus to fulfill advertisers needs. As a result, the advertising market will become more transparent and innovative. The age of the classical mobile ad network will come to an end and in-app advertising companies will need to innovate and prove that they can deliver a value add for advertisers and publishers.
Trademob is an Adjust preferred partner
Trademob is Europe’s leading technology expert in mobile app marketing. From planning an app launch to re-engaging users and maximizing revenue, the technology company helps build an app marketing strategy from day one and finds the right media mix for every stage in the app marketing lifecycle. Coupling the world’s largest mobile inventory with its own pioneering mobile advertising technologies, the company achieves a maximum volume of high-quality users and revenue for its clients. By leveraging real-time bidding and retargeting through its proprietary technology platform as well as unmatched industry expertise efficient and effective app marketing is achieved. Trademob plans, tracks and optimizes mobile user acquisition and re-engagement campaigns across more than 250 mobile ad networks, RTB exchanges and media partners, reaching over 1 billion iOS and Android users. Founded in 2010, the venture-backed company is headquartered in Berlin, servicing a multitude of international clients. Trademob serves world-renowned brands such as eBay Classifieds and bwin.party.