Increase your ad eCPM by running house ads
This post is part of my ongoing series on App Monetization Strategies.
Many popular (and successful!) app monetization strategies include using ads as a revenue source. I’ve personally used ads to help monetize many of my apps very successfully, but even so, I share a complaint many other developers have about ads: eCPMs from ad networks usually suck (if you’re not sure what an eCPM is, check out my intro post on ads).
Even with ad optimization and geotargeting – a necessity to make real money off of ads – eCPMs from ad networks alone aren’t spectacular. So how can you increase your ad eCPM overall? One great way is by adding house ads to the mix alongside your ad network partners. You’ll definitely see a noticeable jump in eCPM almost immediately. So what exactly are house ads and how can they increase your eCPM? Read on to find out!
So what exactly are house ads?
House ads are ads you run in your apps for content / services you own. For example, you can run an ad for the paid version of an app in the free, ad-supported version of the app. House ads aren’t limited to advertising other apps, though. One of the best use cases I’ve found is using house ads to advertise in-app purchases since you can target users with purchases that are more relevant given their app usage. This benefits both the user because s/he has the opportunity to buy relevant content / features and the developer since s/he will receive additional revenue of the user purchases the content / features.
Why house ads will increase your eCPM
Your house ad eCPM will be higher than your ad network eCPM primarily for two reasons:
- You’re cutting out the middleman. Instead of sharing 40-60% of your revenue with a third-party partner, you get all the revenue associated with the ad. This is huge. How huge? Not having to share 40-60% of your revenue instantly increases your eCPM by 66%-150%, all things held constant.
- House ads are more relevant. Unlike search ads, which I do click on occasionally because they offer me a product, service, or discount that’s relevant to my search, I rarely click on mobile ads. Why? Most mobile ads are advertising things that I have no interest whatsoever in. This is where house ads shine. Imagine downloading a lite version of an app and seeing an ad for a similar app and then seeing an ad for the full version of the app. You’re much more likely to click on one of these ads and download the app versus a blindly-served ad advertising an app that you have no interest in.
How much will house ads increase your eCPM? Your results may vary, but I’ve seen eCPMs that range from 2 – 5x what I received from ad networks running in the same app’s ad space.
Running house ads in your ad space
It’s easy to run house ads in your ad space. Many ad providers allow you to create house (or custom) ads that advertise your own apps / content. One key feature to look for, though, is download tracking. If you’re advertising your own apps, you have to know which sales are linked to which ads so that you can calculate an eCPM and run ads that work more efficiently (i.e., have a higher eCPM) more often. Without download tracking, you simply can’t make an informed business decision as to which ads to run when and where.
Also, it’s important to note that unless you have many different targets for your house ads, you can’t run just house ads in your ad space. You’ll soon start depressing your own eCPM because users will see the same ads over and over again. It’s very important to prevent this phenomenon by running ad network ads alongside your house ads. Keeping your app’s ad space fresh will help better-engage users, yielding higher eCPMs.
Have any questions about running house ads? How about a success story to share with your fellow developers? Let us all know in the comments!