Lesson 8

Paid User Acquisition

As opposed to organic user acquisition, paid UA efforts depend on paying to access a channel you don’t control. Common examples are paid ads on Facebook, Google search or in the iOS App Store.

The truth is that even with the best organic efforts and execution, it is extraordinarily difficult to build a substantial, dedicated user base without investing in some form of paid acquisition. If you’re a newer publisher without much owned media yet, and particularly if you’re looking to scale quickly, it really is a paid game.

  • The Opportunity of Paid: Paid media gives you access to highly targeted, large numbers of users outside your direct control. Paid gives you access to scale.
  • The Challenge of Paid: Paid advertising is generally less trusted, comes at a much higher cost and can be significantly labor intensive. Still, a majority of app publishers rely on paid advertising, particularly at launch.

Remember, there is no one-size-fits-all approach to UA. You’ll have to test, track what’s working, make changes — and do it all again. Then you’ll be able to optimize your spend to favor the tactics bringing in the best quality users. In the next section we’ll look at the many different kinds of paid advertising.

Kinds of Paid Advertising

There are a wealth of formats you can use to advertise your app, and there are opportunities and challenges with each. Deciding what media mix (that’s the combination of channels you use to reach new users) best fits your app, your target audience, your budget and your acquisition goals will take some experimentation.

Banner Ads

  • The most common form of paid advertising, a banner ad, is a static image that appears on a website or in an app that contains a link. The Opportunity of Banners: They offer good control and flexibility in terms of cost, and how and where ads appear. There’s a reason these are so common — they’re easy to place just about anywhere in the mobile universe.
    • The Challenge of Banners: It’s relatively easy for users to ignore them, and users tend to click on them accidentally.

Interstitial Ads

Interstitial ads are full screen ads that cover the interface of their host application. They're typically displayed at natural transition points in the flow of an application, such as between activities or d between levels in a game.

  • The Opportunity of Interstitials: They’re attention grabbing, so users have to acknowledge and interact with the ad.
  • The Challenge of Interstitials: You risk of turning off users who find the ad too intrusive.

Native Ads

A piece of writing, video, or other material in an online publication that resembles the publication's editorial content but is paid for by an advertiser and intended to promote a product or service.

  • The Opportunity of Native Ads: They match the content your user is already consuming so it can sway them to explore further.
  • The Challenge of Native Ads: This type of content has been on the rise in recent years so users are becoming more savvy and avoid it.

Video Ads

Video ads can be highly engaging and give publishers a chance to show off key app features. In-app video ads are expected to generate $13.3 billion in revenue in 2020, and are already well on the way to reaching that number. Video is now often seen in two forms: rewarded video (a user watches a video as a form of payment for accessing the app/content) and skippable video.

  • The Opportunity of Video: Numerous studies show users are far more likely to click on a video than a static image. More importantly, video ads provide high lifetime value (LTV) users since they have a clearer understanding of the app before download, which leads to better retention..
  • The Challenge of Video: Many users won’t have their sound on, and video ads can be expensive to produce. The cost can be offset by attracting higher value users.

Incentivized Ads

An incentivized ad offers users a reward, such as a discount on a product or a game item, in exchange for completing a set task, such as installing an app, registering, or answering a survey question.

  • The Opportunity of Incentivized: It can result in a high, directly measurable response rate.
  • The Challenge of Incentivized: Because users are less organically motivated to engage with the app, they might be less likely to become long-term users.

Partnerships

A partnership designed for advertising purposes is an arrangement made with other brands or influencers in order to bring their audience to your app. One way to identify potential partnerships is to look at cross-app usage of your target audience.

  • The Opportunity of Partnerships: This can be a great way to bring in users who are likely to enjoy your app.
  • The Challenge of Partnerships: Assessing partnership potential takes time and research. You’ll also need to spell out the terms of the relationship.

Hyundai partnered with the hit TV-show The Walking Dead to feature the car in current episodes, and then released a Walking Dead themed app that vaulted to the top spot in the Automotive category. This somewhat unexpected partnership proves that a little creativity can get your app in front of new audiences.

Partnerships can also be based on mutual exchange. For example, a data security app agrees to contribute articles to a data security publication in exchange for links to its app.

Don’t Skip the A/B Test

Just like the creative assets you put together in the ASO section, you’ll need to constantly test your advertising to ensure optimal returns. A/B testing is also a way to keep your ad creative fresh, because very few potential users will click on an ad after seeing the same thing over and over again.

And no matter what kind of campaign you decide to run, you’ll want to think about the advantages and disadvantages of both burst and drop campaigns. For further reading on that subject be sure to check out our User Acquisition playbook.

External Module: Ready to develop, launch and measure a successful UA campaign? Download our playbook to: Learn how to acquire the best users for your app.

 

Keep Learning

Choosing the right network to reach the right users can play a large part in your campaign's success. Go on to learn more.

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