How to Start in Mobile Programmatic Advertising for App Publishers

Oleksii Sakhno

In the 2024th competitive app landscape, maximizing your mobile app monetization strategy is crucial. Now, 70.6 percent of programmatic digital display advertising spending in the United States is expected to be invested in mobile ads.

Each year the focus on mobile programmatic advertising grows. The most important reason for it is the shifting need of the vast network of advertisers seeking to reach targeted audiences. This guide will equip you, the app publisher, with the knowledge to start your path in the world of mobile programmatic advertising and increase the revenue streams for your app.

Key Components Of Mobile Programmatic Explained (SSPs, DSPs, Exchanges)

Mobile programmatic advertising thrives on a complex ecosystem with interconnected players. Here's a breakdown of the key components:

Supply-Side Platforms (SSPs). As an app publisher, you partner with an SSP. This platform acts as your sales representative, managing your ad inventory and sending it out to potential buyers through ad exchanges.
Demand-Side Platforms (DSPs). On the other side, advertisers use DSPs to manage their ad buying campaigns. DSPs connect to ad exchanges to bid on ad space that aligns with their target audience – potentially including your app users.
Ad Exchanges. These marketplaces act as neutral intermediaries, connecting SSPs offering ad inventory with DSPs bidding for that space. Real-time bidding (RTB) happens here, where the highest bidder wins the right to display their ad in your app.

Now comes the exciting part – the RTB auction. This process is crucial to understand how your app can start generating more revenue instreams with programmatic ads. It is how RTB happens from the user perspective.

Ad Request. When a user opens your app and encounters an ad slot, your SSP sends an ad request to the connected ad exchange. This request includes details about your app, its audience, and the available ad space (size, location).
DSPs Enter the Fray. Ad exchanges broadcast the ad request to all connected DSPs whose advertisers might be interested in reaching your app's audience.
Bidding. Based on pre-defined parameters and targeting criteria set by the advertiser, the DSPs representing interested advertisers participate in a fast auction. Each DSP submits a real-time bid for the ad space, considering factors like your audience demographics and the value they see in reaching those users.
Highest Bidder Wins. The ad exchange awards the winning bid to the highest bidder's corresponding DSP.
Ad Delivery & Revenue Generation. The winning ad creative (the actual ad content) is delivered to your app and displayed to the user. As the publisher, you earn revenue based on the agreed-upon pricing model (e.g., CPM - cost per mille, where you earn a set fee for every thousand impressions).

Common Pricing Models:

Cost per Mille (CPM). You earn a set fee for every thousand impressions (ad views) served. This is a popular option for brand awareness campaigns. (e.g., $0.50 CPM means you earn $0.50 for every 1,000 times an ad is displayed)
Cost per Click (CPC). You earn revenue each time a user clicks on an ad displayed in your app. This model is often used for driving app installs or website visits.
Cost per Install (CPI). You earn a fixed amount for every successful app install generated from an ad click. This is ideal for promoting new apps or games.

While RTB forms the core of programmatic advertising, there are additional strategies to optimize your experience. Firstly, please have a look at the header bidding. This technique allows multiple ad networks (including programmatic ones) to compete for the same ad space simultaneously, often leading to higher fill rates (percentage of ad requests filled) and potentially increased revenue. For example, if you historically had a 70% fill rate with a traditional ad network at a $0.50 CPM, programmatic header bidding could increase your fill rate to 80% with an average CPM of $0.60. This translates to a 14.2% uplift in revenue (70,000 impressions $0.50) vs (80,000 impressions $0.60).

Secondly, consider using a mobile ad mediation platform to seamlessly integrate various ad networks (including programmatic) within your app. They are integrated into an app by the developer using a pre-built SDK (software development kit). The mediation platform manages the ad delivery process, ensuring optimal ad fill and revenue generation.

Quantifying the Revenue Boost from Programmatic Advertising

Here's a breakdown of how programmatic advertising can translate into real numbers:

Scenario 1: Traditional Fixed-Rate Deal. Imagine you have a website with 1 million monthly impressions and a fixed-rate CPM of $1.00 with a single advertiser. Your monthly revenue would be: 1,000,000 impressions * $1.00 CPM = $1,000.

Scenario 2: Programmatic RTB. Through programmatic advertising, your 1 million impressions enter an RTB auction. The average winning bid might be $1.20 CPM. This translates to: 1,000,000 impressions * $1.20 CPM = $1,200.

Factors Influencing Your Programmatic Revenue

Fill Rate: This refers to the percentage of ad requests that are filled with an ad. Higher fill rates translate to more revenue opportunities.
Click-Through Rate (CTR): The percentage of users who click on an ad displayed in your app. Higher CTRs can lead to increased revenue in CPC and CPI models.
Bidding Landscape: The competition among advertisers for your ad space directly impacts the bids you receive in RTB auctions. More competition often leads to higher CPMs.
Ad Format: Different ad formats (e.g., banner ads vs. interstitial video ads) can command varying CPMs. Experimenting with different formats can help optimize revenue.

Programmatic Deals for Revenue Optimization

Programmatic advertising goes beyond the standard RTB auction. Here are key deal options to consider:

Open Marketplace (OMP): An open auction attracting a wide range of advertisers. Leverage header bidding within OMPs to maximize fill rates and revenue.
Private Marketplace (PMP): A closed auction with pre-approved buyers, offering publishers more control, potentially higher CPMs, and brand safety for advertisers.
Programmatic Guaranteed Deals: Direct negotiations between publishers and advertisers for a fixed price and volume, ensuring predictability and stability.

Choosing the Right Programmatic Platform for Your App

Selecting the right SSP is vital for your success. Consider factors like:

1. App Category & Audience

Gaming App: Focus on high fill rates, vast gaming advertiser networks. Examples: AppLovin MAX, ironSource

Finance App: Prioritize precise targeting capabilities. Examples: Magnite, OpenX

Publishers looking to monetize their website or app with Blasto have two main options. Prebid, an open-source tool, allows publishers to integrate Blasto alongside other ad exchanges, potentially leading to higher bids through real-time competition. Alternatively, publishers can connect directly with VAST integration. Regardless of the method chosen, Blasto offers publishers access to a wider pool of advertisers, potentially increasing their revenue through programmatic advertising.

2. Features & Functionality

New App: Look for user-friendly interface, excellent support. Example: Unity Monetization.

3. Reporting & Analytics

E-commerce App: Focus on in-depth reporting for optimization. Examples: Verve Group, Amazon DSP.

The Benefits of App Monetization Through RTB

Real-time bidding is the heart of mobile programmatic advertising. Here's why it benefits you.

Increased Revenue Potential. With multiple advertisers competing for your ad space, RTB can drive higher eCPMs compared to traditional ad networks.
Global Reach. Programmatic platforms connect you with a vast pool of advertisers worldwide, expanding your monetization potential.
Granular Targeting. Target users with laser precision, ensuring ads are relevant to your app's audience, leading to better user experiences and potentially higher ad engagement.

In Conclusion

Mobile programmatic advertising offers a powerful and automated way to maximize your app's revenue potential. By understanding the key components, choosing the right partner, and continuously optimizing your campaigns, you can unlock new revenue streams and achieve sustainable app monetization success.