Despite an expected slowdown in overall ad spending, in the year ahead mobile ad spend will continue to grow. This growth is being driven by many factors, including app and ad format innovation. Here's a look at a few of the bigger trends at the intersection of advertising, mobile apps, and mobile technology that will factor into how brands allocate their ad budgets in the coming months.
Playable ads are a relatively new entrant into the mobile ad ecosystem, but something we expect to see more of. The format is exactly what its terminology suggests: high-quality advertisements that audiences can play and interact with.
Playable ads offer app users a snippet of interactive gameplay, ranging from 15 seconds to one minute. Once the snapshot of the game ends, the ad gives users an opt-in opportunity to install the advertised app or game. Playable ads are currently seeing strong conversion rates of up to seven times higher than video ads. By letting users try out the app before installing, playable mobile ads also reduce app uninstall rates, which can be as high as 90 percent after two or three months.
Playable ads represent a more balanced value exchange between advertisers and users -- a huge advantage in the era of ad blocking -- and form part of a much wider trend of more innovative, engaging and interactive ad units emerging. While they're mainly confined to the gaming space at the moment, the appeal of ad units that see high-conversion rates and that delight users will see the format quickly cross over into other categories.
More than any other format, virtual reality lends advertisers the most promising canvas for creative since the advent of television. Brands like PepsiCo's Mountain Dew and Post's FruityPebbles have tested the VR waters this year, creating a series of moments that allowed audiences to emotionally connect while shaping their own experiential journeys and stories.
The sight, sound, and motion of VR combined with the extension of control, choice, and total immersion to audiences helps to create a powerful marketing channel for brand advertisers. The hope is that virtual reality improves user experiences on mobile -- to make ads so engaging that consumers don't even realize they're watching advertisements.
In order to continue to integrate the technology with mobile advertising, and to truly push the boundaries, virtual reality will have to overcome the adoption barrier. In every pocket, there's a smartphone, but we're not yet walking around with VR glasses on our heads. The coming year could hold promise for new virtual reality platforms to augment HTC's Vive, Samsung Gear, and Google Daydream.
App publishers and advertisers will continue their intricate give-and-take dance around effective ad formats and enjoyable user experience. App publishers have historically been worried that overly aggressive, intrusive or interruptive ad experiences will drive users away, while advertisers have struggled with the fact that passive ad experiences can't effectively catalyze users to engage with their brand.
Rewarded video has emerged as a possible happy medium. Rewarded video ad units, which are increasingly being embraced by both performance advertisers and brands, reward users with in-app currency in exchange for watching a video ad. Users can choose to opt-in or out, and receive concrete value in exchange for interacting with an ad. App publishers benefit from a seamless integration with their in-app economy and high eCPMs, while advertisers enjoy the guaranteed viewability of an opt-in view. This unit's ability to make the value exchange clear and obvious to an app's end users also helps solve part of the ad blocking puzzle, and in some cases users have gone so far as to complain when rewarded ads are removed from their favorite app.
Brandformance isn't just the union of two words -- it's the integration of traditional brand awareness campaigns (typically purchased and measured by impressions, or CPM) and campaigns, more often found on digital or mobile, which have specific engagement points and user actions as end goals (typically bought and measured by installs CPI, or engagement, CPE).
These call-to-action campaigns are highly effective at driving measurable consumer actions (like purchases, for example) that support real business goals. They can also work to drive brand awareness, like increasing the ranking of a brand's app to help raise visibility and in turn increase transaction volume, subscriptions and user retention. Advertisers can also tap in-app advertising and mobile video advertising for additional KPIs, including registrations and logins, social sharing, wish lists and checkouts.
The broader vision of brandformance is to inject more measurability, whether in the form of engagement, revenue or other metrics, into traditional brand awareness campaigns, such as broadcast advertising. Put another way, traditional brand advertising campaigns, which are rooted in less measurable concepts, like emotional engagement and marketing to a consumer's subconscious, will evolve to embrace more measurable, quantifiable metrics.
Conversely, or perhaps even ironically, larger mobile companies like Machine Zone have made massive traditional ad buys to help drive brand awareness around their flagship mobile game titles. They've been on the record that these traditional brand awareness TV buys were made after, and only after, they saturated the digital media ecosystem with ad buys.
In the future we can expect to see the lines between the brand awareness and performance advertising worlds continue to blur.