The latest index from mobile marketing firm Fiksu DSP shows that mobile ad costs are on the rise.
“(That’s) a result potentially due to iPhone 7 adoption as well as early holiday ad spend,” the Fiksu crew tells us. “The data also shows that as advertisers see sustained returns and recognize the opportunity to find high quality users on the maturing Android platform, the marketplace is becoming flooded with competition, especially as the holiday season approaches.”
Fiksu’s indexes — an industry favorite for keeping tabs on mobile — track year-over-year and monthly metrics, measuring cost per thousand impressions (CPM) and cost per purchaser (CPP) across mobile RTB advertising.
“Seasonal competition is evident in this data, but the numbers indicate that these trends may be sustained over the long run,” said Tom Cummings, the VP for new market strategy at Fiksu DSP. “It’s growing increasingly evident that Android represents a great opportunity to find users who are more likely to make a purchase, so while many advertisers enjoyed the opportunity to find the right users at a lower initial investment, the rest of the market is quickly catching on.”
At the moment, the latest iPhone launch is still affecting the market.
“It took about three weeks for the new operating system to take over as the most rapidly-adopted OS launch to date, and the index data reflects a rise in competition as advertisers fight to get in front of new users, including both recent iPhone 7 owners and those who upgraded to iOS 10 on older phones,” according to the report.
And then, of course, there’s holiday spending. That applies to both iOS and Android, where CPM is up. Over the past month, costs have risen by 26 percent for iOS and 6 percent on Android.
Expectations are that until the end of December, the numbers will climb as advertisers seek to reach the consumers most likely to purchase and activate new devices during the holiday season.
“Advertisers will be laser-focused on getting their share of the mobile surge around the holidays, driving up bids for higher-quality impressions and emphasizing lifetime value and loyalty,” said Cummings. “We already saw this start to happen in October, so those that wait much longer to launch holiday spend are likely to be left out to dry earlier than they may have expected.”
Marketers on both iOS and Android should also be aware of new developments in advertising content that could impact CPM and their return on investment.
“One thing we’re watching for is the impact of playable ads,” said Cummings. “CPM is typically high for playables, but users tend be very high quality which we see play out as lower CPP results. We’re beginning to see that impact and expect that the remainder of Q4 will reveal more of the same.”
More information about the Fiksu Indexes is here.