September 3, 2014
Why are mobile ad click-through rates so low? Simple. Mobile advertising is broken.
Standard banners, unbelievably, persist to be the dominant ad format regardless of the studies or industry feedback that would agree that they are largely ineffective. With media eyeballs rapidly shifting to mobile devices and publishers reporting 50 percent of traffic is now generated from phones and tablets, mobile ad budgets from agencies are not following the change in consumer behavior at the same pace.
Down the banner
With publishers, there exists an interruption issue where ad placements are prone to compromising the user experience: placing ads at points during the in-application user experience where there is not a natural break for an advertisement.
Nonetheless, advertisers and publishers need to do more to contribute to juicing up some of the low-hanging fruit.
Time and time again, we have all seen what looks like online ads re-purposed for mobile with little consideration for the mobile user experience and with messaging that is cluttered and unreadable on small screens.
Advertisers need to be more accountable for delivering high-quality ads specifically created for mobile devices versus quick fixes that reuse existing assets.
The industry needs to break away from the ubiquitous standard banner that offers advertisers limited space for communicating messages. It needs to explore ad formats that for advertisers are proving to be far more effective in terms of engagement and, for publishers, generate higher CPMs.
Other ad formats include rich media and video, with the latter already proving to deliver significantly better results.
Just as important as it is in other media such as television and radio, the timing of advertisements on mobile devices plays a critical role in determining the click-through-rate or effectiveness of an ad.
Game for change
Taking gaming apps as an example vertical – and the largest earner for mobile ads – the obvious and logical place for an ad has been to place 320x50 banners at the bottom or top of iPhone and Android phone screens.
For consumers, they see this ad placement as an interruption and they do not like it.
An alternative placement for an ad in a game could be between levels where publishers can integrate larger and higher-performing ad formats. Even that ad placement navigates gamers away onto external sites, thereby interrupting the gaming experience they are currently enjoying.
A natural and logical progression could be to place ads at the start and at the end of a game – for example, pre-roll or post-roll ads – when consumers are more receptive to accepting advertising. This improved timing results in higher user engagement, which generates improved advertising campaign performance for advertisers and monetization for publishers.
The latest buzzword in advertising circles and no doubt beyond is native. The challenge for mobile advertising is how to apply native concepts that scale across all application verticals.
Native presents both advertisers and publishers with tools for delivering far more effective advertising that can integrate seamlessly with the flow of the app or site.
One native concept that is promising and has the ability to scale across all verticals is a sponsorship wrapper – “ABC app has been brought to you by XYZ advertiser” – at the end of the app session.
TODAY’S MOBILE users are turned off by ads that are too intrusive. However, they are showing high levels of engagement if the ad is shown in a timely, relevant and respectful way.
If app publishers adopt this philosophy, they are sure to get their users’ attention and significantly increase their ad monetization.
Jim Wolfinger is CEO of IQzone, Scottsdale, AZ. Reach him at email@example.com.