It wasn’t until recently that publishers were responsible for managing multiple publishing platforms and monetization sources at once to maximize their overall ad revenue. Then, in-app header bidding came onto the scene circa 2015, rivaling Google’s waterfall method. 

Where the waterfall method left both advertisers and publishers hanging to a certain extent, in-app header bidding provided a more efficient way for mobile publishers to monetize their ad inventory via ad requests.

In this article, we’re going to tell you everything you need to know about in-app header bidding, including how it works, how it benefits publishers and advertisers, and more.

What Is In-App Header Bidding?

Also referred to as advance bidding or pre-bidding, in-app header bidding is a programmatic advertising technique that allows mobile publishers to provide ad space to multiple supply-side platforms (SSPs), ad exchanges, or networks simultaneously. It’s also a notably more fair method when compared to the waterfall model, which consisted of unsold ad inventory being offered to the highest-ranking platforms first and remnant inventory being offered to the rankings below.  

In-app header bidding automatically generates bids from multiple advertisers simultaneously by placing a publisher’s inventory across multiple demand-side platforms (DSPs). This is also in contrast to real-time bidding (RTB), which makes DSPs wait “their turn” to enter an auction. With in-app header bidding, DSPs can participate in equal measure, allowing publishers to receive demand-based bids for their ad space, leveling the playing field between the two parties in terms of traffic value bidding.

How Does It Work?

In-app header bidding works by gathering bids from everyone simultaneously. By “everyone,” we’re talking about DSPs, ad exchanges, and ad networks (as mentioned above). 

All parties can enter the auction at the same time to bid on the same inventory. However, unlike the waterfall method, in-app bidding doesn’t stop the auction at the first “acceptable” bid. Instead, the in-app header bidding method depends on a string of JavaScript code that is embedded into the header of participating publishers’ websites. The function of this string of coding is to connect publishers’ websites to all potential sources that may be interested in buying advertisements. 

So, every time a publisher’s page is loaded, advertisers and associated parties can bid on each impression on the loaded page. This allows the highest bid to win rather than stopping the auction at what’s been set as acceptable. 

It also happens in a matter of milliseconds.  

What Are the Benefits of In-App Header Bidding?

In-app header bidding comes with several benefits for both publishers and advertisers, which is why this method — along with header bidding — has become so popular. 

Let’s start with the main benefits of in-app header bidding for publishers.

Higher Earnings

In-app header bidding allows both web and mobile app publishers to present their ad inventories to even more advertisers, SSPs, ad exchanges, and other ad networks than ever before. This enables publishers to get more buyers to place higher bids to advertise to their intended audience. 

This allows publishers to maximize their earnings by selling their inventories at better CPMs.

Maximized CPMs

In-app auctions also enable publishers to see how much advertisers are willing to offer per impression in mobile apps before the ad is placed. This allows publishers to determine how much each ad impression is worthwhile, comparing the advertisers placing bids simultaneously. From there, the highest-bidding demand source will end up winning the impressions.

It’s like a systematic way of maximizing your CPM — with much less effort toward negotiations.

Higher Fill Rates

When multiple demand partners participate in an auction, fill rates automatically increase. This means publishers can place as many pop-under advertisements as they want on their website because these types of ads don’t occupy space directly on the web pages.  

Better Inventory Value

Another benefit of in-app bidding is that it allows publishers to optimize the actual value of their inventory via header bidding. This is because advertisers are more inclined to bid more during in-app header bidding auctions to win their desired ad placements.

With prices for premium inventory increasing, publishers can further increase their overall ad revenue.

More Consistency

In-app header bidding is also more dependable regarding the flow of bids — due to the variety of bidders added to each auction, willing to bid at different price points for a better chance of winning a bid on as many premium impressions as possible. 

Publishers can also use this opportunity to remarket cookie matches, which are some of the highest-paying CPM rates out there.

Lighter Tech Stack Load

Server-side header bidding offers a lighter tech load for in-app header bidding, reducing the need for multiple SDK integrations and shifting the SDK integration to the server. This simplifies the app’s codebase and reduces the SDK-related technical complexities.

Superior Management

The in-app header bidding ecosystem simplifies the entire auction management process. In header bidding, for example, a wrapper is implemented into the web browser and organizes multiple demand partners while also defining the rules for auctions. 

This provides more control on a per-impression basis with, once again, little effort.

Now, let’s talk about the benefits of in-app header bidding for advertisers.

More Transparency

The in-app header bidding method allows advertisers to access more and better inventory via header bidding. It also makes it easier for programmatic buyers to access this inventory because it doesn’t require tag-based integrations, making all the ad space available visible rather than leaving them with blind spots. 

In this type of bidding environment, advertisers will not only have access to all the inventory available from publishers, but they also have the ability to bid in several channels at once. Of course, if they’re not careful, programmatic buyers may bid against themselves.

More Access to Premium Inventory

Before the general concept of header bidding was introduced, web and mobile publishers had to sell their premium inventory in private marketplaces. This meant that the open marketplaces would only see lower-quality inventory. 

When in-app header bidding came around, all of this changed — for the better. With all the data collected in each web page’s header, advertisers can now view publishers’ premium inventories and quickly place bids to secure their desired ad space. 

Better Targeting and Further Reach

In-app header bidding allows advertisers to view ad inventories more effectively. Essentially, a website’s demographics and impressions get included in each ad inventory report, and all of this data directly help advertisers develop more effective targeting strategies to get the right ads in front of the right eyes at the right moments.

Moreover, this enables programmatic buyers to access their audiences on a much larger scale than ever.

Despite all of the benefits that advertisers are seeing with in-app header bidding, there are a few drawbacks. The main disadvantage for advertisers is the implementation of in-app header bidding. 

Put simply, whenever new technologies in the ad tech world are introduced, it can take a significant amount of time for new and old users to learn them and get used to how a new system works. Even publishers have difficulties setting up in-app header bidding because the technology is complicated to implement. 

Final Comments

In-app header bidding is one of the modern answers to demand source fragmentation, as it allows for multiple-party bidding at once. Advertisers can bid on ad impressions across as many sources as possible, while publishers can ensure that their inventories are sold at optimal prices. Not to mention, it offers a greater level of transparency in programmatic buying than ever before.

It’s essentially a more democratized advertising solution that benefits all parties involved. It also allows programmatic buyers to compete for ad space in real-time rather than being placed within a hierarchy of demand partners. This method completely levels the playing field by allowing advertisers and publishers to view each offering in detail compared to averages and limited data. 

Of course, in-app header bidding is hardly the final culmination. Ad tech technology is ever-evolving to make programmatic media buying and selling more efficient and safer for all the parties involved. Keep up with the ad tech industry’s current and incoming trends by watching our blog and other resources.

The post How Does In-App Header Bidding Work? first appeared on Freestar.

In this blog post, we will delve into the significance of MAU in-app monetization and explore why it is vital for app developers and publishers. We will discuss how MAU serves as a performance measurement tool, highlighting its role in evaluating user engagement, assessing monetization potential, determining market value, and aiding user retention and growth strategies.

Furthermore, we will differentiate MAU from another key metric, Daily Active Users (DAU), and explore how their distinct time frames of measurement offer valuable insights into app usage patterns, user behavior, and monetization strategies.

Understanding MAU and its importance is crucial for app developers and publishers seeking to optimize their monetization efforts, attract potential investors, and drive sustainable growth. So, let’s dive in and explore the world of Monthly Active Users and its role in app monetization success.

What is MAU?

Monthly Active Users (MAU) is a metric commonly used in in-app monetization to measure the number of unique users who engage with an app within a given month. It provides insight into the app’s user base and can be used to evaluate its popularity, growth, and engagement levels.

MAU is particularly important for app monetization because it helps app developers and publishers understand the potential reach and impact of their monetization strategies. By knowing the number of users who actively engage with the app monthly, developers can make informed decisions about implementing advertising, in-app purchases, subscriptions, or other revenue-generating techniques.

Having a high MAU count indicates a larger pool of potential users who can be targeted for monetization efforts. However, it’s important to note that MAU alone does not guarantee revenue. User engagement, retention, and the effectiveness of monetization strategies also play significant roles in generating revenue from app users.

Why is MAU important?

Monthly Active Users (MAU) is an essential metric for several reasons:

1. Performance Measurement: MAU allows app developers and publishers to measure the performance and success of their app over time. By tracking the number of active users monthly, they can assess whether their user base is growing, stable, or declining. This information helps them evaluate the effectiveness of their app’s features, content, and marketing efforts.
2. User Engagement: MAU provides insights into how engaged users are with an app. Apps with a high MAU count generally indicate that users find value in the app and continue to use it regularly. It measures how frequently users return to the app, interacts with its features, and potentially generate revenue through ads, in-app purchases, or subscriptions.
3. Monetization Potential: MAU is a critical factor in determining the monetization potential of an app. A larger user base means there are more opportunities to generate revenue through various channels, such as advertisements, sponsored content, freemium features, or premium subscriptions. Advertisers and potential business partners often consider MAU when assessing the attractiveness of an app for partnerships or advertising campaigns.
4. Market Value: MAU is an important metric that potential investors or acquirers consider when evaluating an app or app-based company. A higher MAU count suggests a more extensive user base and can positively impact the perceived value of the app or company, potentially leading to investment opportunities, partnerships, or acquisition offers.
5. User Retention and Growth: MAU helps app developers identify user retention patterns and areas for improvement. By comparing MAU figures over time, they can assess whether their app is retaining existing users or if there is a churn rate (users leaving the app). Understanding user retention helps optimize user experience, address potential issues, and implement strategies to enhance user engagement and growth.

MAU is important because it provides valuable insights into an app’s performance, user engagement, monetization potential, and market value and helps guide decision-making for app developers, publishers, investors, and advertisers.

Difference between MAU and DAU

The main difference between Monthly Active Users (MAU) and Daily Active Users (DAU) lies in the time period over which user activity is measured.

• Monthly Active Users (MAU): MAU refers to the number of unique users who engage with an app or platform within a specific calendar month. It provides a measure of the app’s overall user base and is commonly used to assess long-term trends, growth, and user engagement over a monthly period.
• Daily Active Users (DAU): DAU, on the other hand, represents the number of unique users who interact with an app or platform within a single day. It measures user engagement and activity daily and provides insights into the app’s immediate usage patterns and retention.

The key distinction is the time frame of measurement. MAU provides a broader perspective by considering user activity over a month, which helps capture long-term trends and patterns. It helps assess overall user growth, engagement, and the impact of marketing initiatives over a longer period. On the other hand, DAU provides a more granular view of daily user activity and can be valuable for understanding immediate user engagement, identifying usage patterns, and evaluating the app’s ability to retain users daily.

Both MAU and DAU metrics are essential for app developers and publishers, as they provide different insights into user behavior, engagement, and the effectiveness of app features or monetization strategies. Depending on the specific goals and context, app owners may prioritize one metric over the other or analyze both to gain a comprehensive understanding of their user base.

In Conclusion

The monetization potential of an app is closely tied to its MAU count, as a larger user base offers more opportunities for revenue generation through ads, in-app purchases, subscriptions, and partnerships. Moreover, MAU influences the market value of an app or company, attracting potential investors and acquisition offers.

MAU plays a crucial role in-app monetization, offering valuable insights into app performance, user engagement, monetization potential, market value, and user retention. By analyzing and leveraging MAU data, app developers and publishers can make informed decisions to drive success in the highly competitive app ecosystem.

The post What Are Monthly Active Users? first appeared on Freestar.

There are tons of key performance indicators (KPIs) out there for measuring app performance. We could easily run you through a list of the best KPIs for mobile apps, however, a ‘best of’ list wouldn’t necessarily be accurate.

Why?

Because not all KPIs will apply to every in-app scenario — nor are they of equal importance for each app owner or app marketer.

App marketers and owners alike rely on in-app purchases, advertising, upgrades, and subscriptions for their monetization needs. However, they tend to ignore the finer points of data analytics. For example, which users are worth holding onto or which monetization methods need improvement.

So, which KPIs and strategies for measuring your mobile app’s performance should you focus on?

Let’s discuss.

Mobile App Benchmarking 101

Before we can jump into the KPIs you’ll want to focus on, it’s important to understand what exactly it is you’ll want to measure. This is known as mobile app benchmarking, and it’s characterized as the process by which you would compare your own mobile app’s performance compared to others of a similar function and size. 

Ultimately, the goal is to improve your app’s performance so that it not only rivals the competition but surpasses them. Mobile benchmarking will look different for everyone, but it will always consist of selecting the competitor apps you want to make comparisons with and using a few specific KPIs such as the following:

• Downloads
• Daily active users (DAU)
• Monthly active users (MAU)
• Retention revenue
• Session length
• Average session per DAU
• Lifetime value (LTV)

Essentially, mobile benchmarking allows you to set your own performance standards (benchmarks) for your app. If your app is performing below the market standard, then you know there’s room for improvement whereas if the performance is above your standards, then you can use this information as motivation to double down on the activities that are driving your app’s success. 

Your benchmarks are what will keep you and your mobile app on track, starting with how you want your app to perform. Once you have something to compare your app to, your KPIs are how you will measure that performance moving forward. 

The KPIs You Want to Focus on For Mobile App Performance Success

So, above we listed some common KPIs you’d want to use alongside your benchmarks to monitor and improve upon your mobile app’s performance. However, the list of KPIs you want to pay attention to for optimal mobile app performance is a bit longer. 

We’ve categorized KPIs by engagement and monetization. Engagement metrics give you an opportunity to improve user experience and proactively avoid churn whereas monetization metrics help to understand how effectively you are monetizing your app. The following are the KPIs that matter the most when it comes to owning and maintaining a successful mobile app:

Engagement KPIs

Monthly Active Users (MAUs)

Understanding how many MAUs you have is one of the best ways to gain insight into what your audience looks like when they engage with your app. 

The MAU KPI looks a bit different for everyone as it depends on what you consider to be ‘user activity’. For example, if a user logs in to your app at least once over a 30-day time period, this would count as a measurable MAU. 

More importantly, it’s best to think of MAU as a directional signal since a user can fail to engage with your app in a meaningful way despite logging in or not coming back to use it until a month later. Therefore, keeping an eye on the rise and fall of your MAU count can give you a general sense of whether your acquisition and retention efforts are successful.

Daily Active Users (DAUs)

Understanding your MAUs is important, as it’s a reflection of your acquisition and retention efforts. However, knowing how many people are engaging with your mobile app each day is even more important. 

This is because your daily active users refer to the people using your mobile app on an individual basis — not the number of login sessions. You can also calculate your DAU for specific days to get a better understanding of what exactly your users were doing or looking for. This will allow you to better serve them and their needs in the future.

Daily Sessions Per DAU 

Once you get a picture of how many users are engaging with your mobile app each day, you can narrow down the data even further by taking a look at how many times per day users are accessing your app. This will give you a more nuanced view of your audience’s daily habits concerning your mobile app as it reflects on your desired level of user activity as a business.

To calculate daily sessions, you’ll first need to have tracked your DAUs. From there, you would just divide the number of daily active sessions by the number of daily active users for the same day.

Average Session Length

Session length is a pretty straightforward KPI. It measures how much time users are spending on your app on average per session. In simpler terms, it’s how long a user has your app open and how long they’re actually engaging with it versus simply having it open in the background.

You can calculate your average user session length by dividing the total amount of time spent in your mobile app by the total number of users logged in during a given time frame.

Stickiness

Your daily sessions per DAU can provide you with micro-level insights into repeat user activity. Stickiness, on the other hand, expands on this insight by offering you a monthly perspective. Stickiness is a critical KPI because it’s the metric that lets you know how engaged and likely your audience is to stick around — hence the name.

To calculate your app’s stickiness, divide your DAU by your MAU. The closer the two KPIs are to each other, the more effective your mobile app is at getting users to come back over and over again.

Retention Rate

User retention is arguably the most important KPI for mobile marketers and app owners. After all, users won’t engage with your app if they’re no longer using it. Therefore, understanding if and when churn is happening is your first step towards reducing it to ensure that you keep as much of your audience coming back.

There are several ways to define retention. One of the most efficient ways is to consider range retention, which compares the number of users from the previous weeks, months, or other date range against the next appropriate date range. This will allow you to see how many users continue to return to your app and engage with it over certain time frames.

To calculate your range retention rate, all you have to do is divide the number of users from your time frame of choice — let’s say one month — and divide it by the number of users that engaged with your app continuously the month before that. From there, you can see how your retention rate varies over the course of a few months.

Churn Rate

While your retention rate paints a picture of how many loyal users you have, your churn rate can show you how many users have stopped using your app. Essentially, your churn rate is your user loss rate.

To calculate churn rate, all you have to do is subtract the number of users you have at the end of a given time frame from the beginning.

Monetization KPIs

Cost Per Acquisition (CPA)

Whether you’re running an app or a brand awareness campaign, one of the main goals is to continue acquiring new customers. Of course, customer acquisition requires a certain amount of monetary investment, which is why it’s helpful to understand how much is being spent to acquire each new user. This way, you’ll know whether or not you’re budgeting correctly for this type of event.

To get your CPA, just divide the costs associated with your last campaign by the number of acquisitions that took place throughout its course. Do this for every mobile app marketing campaign so you can compare the relative impact of each one so you can manage your marketing spend more efficiently.

Average Revenue Per DAU

Getting users to download and use your mobile app is only part of the battle. The next step of the process is to turn those users into value — specifically, revenue generation.

You can think of your app as a tip jar. Every time your user interacts with you in-app monetization model (ex. views an ad, purchases a subscription, etc.), you receive a tip which adds up to your app’s revenue over time. ARPDAU helps you understand how well your app is generating revenue. By revenue, we are talking monetization generated from ads, subscriptions or/and In-App Purhcases (IAP).

ARPDAU is calculated by dividing Daily Income by Daily Active Users.

Customer Lifetime Value (LTV)

This is another KPI that will look different for everyone. Overall, LTV will help you determine your brand’s customer relationship based on how much value can be generated by the average user over the length of time they spend as a customer. The better the relationship, the more you’re getting out of your acquisition costs.

To determine your LTV, take the ARPDAU and multiply it by lifetime. To calculate the average user’s lifetime, you can look at retention rate and incorporate that into your calculations. Lifetime may differ based on how an app defines and tracks user lifetime.As more time passes, you’ll have even more valuable data to measure for your KPIs. Don’t expect to get the best view of your mobile app performance within just a few months. It takes time to gather valuable information that you can build upon to make your mobile app a success.

Return on Investment (ROI)

ROI is the holy grail of KPIs across all industries and marketing efforts. Understanding how much value is generated per campaign compared to how much was spent on it is the very key to future mobile app marketing strategies.

However, there are a lot of variables involved, which can make calculating your ROI a bit tricky. The most important thing to remember is that when calculating your ROI, there needs to be an internal alignment on what’s being valued and what the investment costs were for it to make sense. We recommend publishers focus on ARPDAU, LTV, and CPA to calculate the ROI for marketing campaigns of their app. Using these metrics can help you determine if your app is revenue efficient. For example, if your LTV is lower than your CPA, your app is unprofitable because you have a negative return on your investment. These metrics can help you improve your business model and become more profitable.

Key Takeaways

If you have an app, monitoring your KPIs are important to improve your app’s performance. These are the KPIs you should be monitoring regularly:

• Engagement KPIs
  • Monthly Active Users
  • Daily Active Users
  • Retention Rate
  • Churn Rate
  • Stickiness
  • Average Session Length
• Monetization KPIs
  • Average Revenue per DAU
  • Cost Per Acquisition
  • Customer Lifetime Value
  • Return on Investment

There’s always time for improvement and the opportunity to address these KPIs. Other performance metrics to consider are uninstalls, ad latency, app load time, crashes, ratings, reviews, etc.

As more time passes, you’ll have even more valuable data to measure for your KPIs. Don’t expect to get the best view of your mobile app performance within just a few months. It takes time to gather valuable information that you can build upon to make your mobile app a success.

The post KPIs For Measuring Mobile App Performance first appeared on Freestar.

So What Exactly Is an SDK?

SDKs help to standardize the development of app creation and functionality to make them work more seamlessly on different types of hardware, operating systems, and in conjunction with other apps. Not to mention, they save software developers a lot of time and frustration regarding tedious bits of coding. 

In short, SDKs allow developers to create software without having to write every bit of code from scratch. They are installable packages that carry the specific tools that the developers will need for jobs regarding the foundation of an app or its functional components. 

The Importance of SDKs For Ad Monetization

Many ad-tech companies have built their own SDKs enabling developers to render ads on their apps, and create a new revenue stream for their business. 

SDKs are used in app development for the same reason that professionals are called upon to build homes — because a job well done is best done by the people who understand how to build something out of accumulated knowledge and experience. In this case, the ad-tech companies are the experts – and they’ve harnessed the power of their SDK technology to make desirable ad inventory available directly to advertisers. For app developers, the ad monetization SDK gives an easy way to implement ads, without building from scratch and needing to become an ad-tech expert. 

SDK technology gives ad-tech companies access to useful signals when it comes to showing ads in an app; such as access to a user’s location, device type, operating system, Device ID (in some cases) and more. Those signals can help to improve ad targeting/decisioning for advertisers buying the inventory – and arms ad-tech companies with the ability to make ad inventory more desirable to advertisers. 

As a developer, there are many factors to consider when choosing which ad SDKs to partner with. However, prior to choosing partners, it is important to understand the types of ad monetization SDKs that exist within the ecosystem. 

Understanding Ad Monetization SDK Types

There are various types of ad monetization partners you can work with, and as a result their SDKs can serve different purposes for your app. Check out the list below:

• Ad Network/SSP (Supply Side Platform) SDK – an ad network builds their own SDK that serves ads sold by their direct sales team or through programmatic connections. Developers can integrate any number of these SDKs to compete with each other. 
• Server-Side Bidding SDK – a technology that allows publishers to work with multiple different ad networks/SSPs without integrating their specific SDK. 
• Mediation SDK – enables competition between multiple ad network/SSP SDKs, direct sold and server-side connections for ad inventory on an app. Developers only need one mediation platform to manage the rest of the SDK’s integrated. The mediation SDK controls the ad auction logic, ultimately determining and selling an ad impression to the highest bidder. 

In some cases, there are entities facilitating a combination of their own Ad Network/SSP along with server-side bidding. There is also a possibility that an entity supports their own Ad Network, server-side bidding while also operating as the mediation platform. 

The mediation SDK is among the most important of starting points – it controls the auction logic for which networks/SSP’s compete for ad inventory, and contains tools that enable developers to earn the most out of their inventory (i.e. segmentation, performance data, a/b testing, optimization capabilities, etc.). You can think of the mediation platform as the foundation of your house. Once chosen, you can start to build on top of that foundation by introducing other partners to compete on your inventory. 

As previously mentioned, mediation SDKs can operate their own ad network/exchange that competes with other demand partners. Conflict of interest? Perhaps. It is hard to know if the mediation platform is favoring their own exchange to win more impressions to help their bottom line – especially if they don’t disclose their rev-share. When vetting your potential mediation platform, this is an important factor to consider. When vetting which ad monetization SDKs to include in your ad-stack, keep in mind how they fit in as well. 

Too many SDKs? Oh my! 

Each time you add an SDK to your app it can increase the size/weight of it. Meaning, it will take users longer to download, open and use your app the larger it gets. A key component of the ad SDK world is making sure you integrate the right partner SDKs into your app to maximize your revenue potential, while limiting the negative potential impacts to your users. 

That’s where leveraging server-side bidding technology can be helpful. The server-side bidding SDK allows you to enable an ad network/SSP to compete on your ad inventory without their SDK present. At Freestar, we typically recommend a mix of client side SDK integrations, along with server side connections to compete on your inventory. Doing so will result in an app that isn’t too clunky, while also maximizing your revenue through increased competition. 

Quick Tip: integrate the market’s best performing networks/SSPs SDKs into your app – but leverage server side technology to bring on additional demand partners. 

The Freestar Way

Freestar offers a single, unbiased SDK powered by proprietary tech. Our SDK provides app developers the most complete fully managed demand ad stack in the industry and offers nearly every in-app ad product. At our size and scale, we are able to secure incredibly favorable terms which we pass along to our partners. 

We do not have an exchange. Our platform is unbiased and our goals are aligned with our clients’ goals; to earn the most revenue possible. We provide clients with customized recommendations from the ad implementation to the demand stack that will make our clients the most revenue.

The post What Is an SDK and Why They Matter in Ad-Tech first appeared on Freestar.