Mobile CPA is one of the biggest growth hacking opportunities for app marketers because it is relatively cheap and covers wider audiences.
You've probably heard about CPA and want to find out more about the benefits it has to offer for mobile marketers. CPA is a performance-based advertising strategy where a publisher or affiliate gets paid for a measurable action a user takes when interacting with an advertiser’s app, for example, when making in-app purchase or subscribing.
As Ron Brightman once said, ”The shift has already happened.” CPA-based advertising strategy is the fastest way to launch and grow an app even for beginners. Performance advertising offers app marketers a winning strategy for app growth.
Nowadays mobile CPA is one of the biggest growth hacking opportunities for app marketers because it is relatively cheap and covers wider audiences, comparing to desktop ads.
Mobile usage stats
According to Businessinsider, two-thirds of the world population are using mobile phones. In 2018 Pewinternet published research showing that 95% of Americans own cell phones of some kind and 77% of them are using smartphones.
In other countries, a smartphone tipping point has already passed. There are more than 50% of mobile users in Singapore and Sweden that have been using smartphones for 5 years.
Statista predicts that with a stable development of mobile technologies the number of mobile phone users is expected to pass the 5 billion mark by the end of 2019, and the number of smartphone users will reach up to 3 billion.
In a recent report
of PwC, it was showed that by the end of 2019 a majority of mobile connections worldwide will be on smartphones.
The popularization of smartphones has completely changed the way we access information, as well as our consumption behavior. Thanks to this, business owners revised their attitude to app marketing and saw how mobile advertising implied a whole change in paradigms.
Mobile is a big marketplace with big possibilities. The industry is not just a whim but a necessity. So, why mobile marketing became so trendy and why marketers prefer to invest in it?
What’s the high-level goal of app marketing?
While the number of mobile users is growing, app marketers are searching for new opportunities in digital advertising. They are trying to find a perfect recipe of customers attraction for a long period.
Marketers want transparency into their ad campaigns and performance.
Lifetime value (LTV) is a KPI that underlies in-app marketing. LTV is essential to measure investments in user acquisition, engagement, and retention. Another important indicator is ROI. To calculate return on investment and see which marketing investment delivers positive index, app marketers use the LTV data.
Everything is interconnected in mobile marketing and all the measurements are aimed at achieving a high-level goal to improve their performance.
Benefits of app marketing
Any business can benefit from advertising that goes directly to your customer’s phone. However, before the actions, better understand the specific advantages of app marketing so you can adapt your advertising to this method.
The first benefit relies on accessibility because people used to utilize their mobile devices many times during the whole day. It means that you can reach potential customers anytime wherever they are. In substance, you have round-the-clock access to your customers.
And one more thing is the number of mobile users. Try to count how fast the mobile user rate grows. It increases in a geometric sequence. So, if you need to market to a wide range of target audience, do it with the help of mobile advertising.
According to Google
, 2015 was the first year when mobile traffic overtook desktop traffic.
The next benefit will be time relevance. No other advertising medium can offer this “always on” advantage. Because people used to keep their phones with them, the messages from advertisers are time-sensitive.
Mobile marketing offers a budget type promotion for advertisers. It costs less than other types. Simply put, you can reach more people for less money.
According to oneAudience
, app marketing gave marketers more than just another way of advertising. It’s all about deterministic matching
. As you know, each mobile device contains a unique ID that can provide information about online and offline customer habits of the user.
Consideration of your target audience habits will make your marketing campaign more accurate. Having this data you can boost precision, relevancy and targeting ability of your future campaigns.
When it comes to the performance of your business, your ROI is crucial to your success. And what if instead of focusing your mobile ad spend on awareness-metrics like impressions and clicks, you could spend your money on real business results like leads, conversion, and sales?
This is where CPA marketing joins the game.
CPA marketing is an attractive business model because of unlimited offers, fantastic ROI, and long-term residual income. It allows to allocate the budget more effective on advertising and is often the most profitable payment model.
CPA advertising models
Performance marketing can include different actions that are needed for advertisers or app managers. It all depends on what purpose the advertising campaign follows. CPA can include: visit of the app page, feedback receiving, view video, app install, etc. CPA advertising differs from the types of actions performed by users.
1. Payment per install:
CPI model gives information about the price of generation a single app install on a smartphone or a tablet. Simply put, app manager pays each time an app is installed.
CPI model can help advertisers reach high-quality users and their target audience, allow to measure ROI for app marketing efforts and budgets.
- Install the app
2. Payment per engagement
A pricing model in which app advertiser choose a post-install event and pay for users who were engaged in that specific event.
In CPE advertising, the event can be defined as:
- Reaching level X
- Writing a review
- Filling out an application
- Indication of a phone number or email
Advertiser has to decide several moments: what the money will be paid for and what the involvement procedure will include; the user has to understand what he should do; you have to understand how the participation of the user will be measured.
3. Payment per sale
This is another variation of the CPA model where advertiser pays the affiliate in case of purchase of the product or service.
- Making a purchase through the app
- Online payment-service
- Return to the order in progress (items left in the basket or liked)
With CPS strategy companies generate money with the help of new sales and pay for the success of the campaign. It helps eliminate unnecessary costs while expanding new sales and growth.
Mobile CPA marketing is designed as a lead generation tool. It collects all the required information. For instance, app advertising offers users to improve the character in the game or offers similar clothes in the application.
Who’s involved in mobile CPA marketing?
The CPA model is simple and has clearly defined roles:
Affiliate or publisher plays a role of the influencer that promotes a service or a product in order to drive traffic to a certain app and make specific conversions.
Advertisers or app managers are those guys that want so that their target audience knew about the brand. They desire a partnership with affiliates to drive quality traffic, increase sales, generate leads or boost conversion.
CPA networks are platforms that bring together affiliates who want to make money by promoting their products and services. Some of the CPA networks have the ability to manage the partner search process and help with fraud detection.
CPA: benefits for advertisers and app marketers
CPA marketing is based on KPIs optimization. Performance-oriented marketers are focused on actions like leads, sign-ups, conversions, and sales. That is why mobile CPA is a winning decision because it aims to fulfill the most important task of the advertiser.
CPA marketing payment model is advanced for the business because advertisers pay only for a successful conversion is made. The payouts differ depending on competition and average commission rates in each vertical. That is why performance marketers always trying to optimize, rethink and try new things.
The cost-per-action formula is a low-risk method for advertisers as they pay only for the desired action after they occur. For example, with the paid traffic it doesn’t work like that. You just pay to get people on your app page through ads.
The cost-per-action for the advertiser can be determined by dividing the total cost of the marketing campaign by the number of completed successful actions. You don’t pay for traffic that doesn’t convert.
CPA platforms help to find needed influencers or affiliates to decide on the right targeting and audience. It takes a little time and money to use this marketing technique.
You always can change affiliates that offer low-rate conversion or don’t bring needed profit at all. Shift your focus to more successful affiliates.
Since you only pay for results, there is a low risk to be fooled by scammers. You also can use special tools that help to monitor how the affiliate promotes your offer.
It works with small and large budgets, it’s more accessible to small organization or brands that just starting figure out their marketing strategy. Together with this performance marketing gives you a real-time measurement of ROI. You can see a snapshot of your ROI at any time you need: CPL, CPS, CPI, etc.
The research of CJ Affiliate
showed that customers spend more money shopping at the recommendations of someone they know. CPA marketing campaign drives a better quality of traffic and offers a better value
than other traffic sources.
It is an innovative space that helps app marketers move forward. With CPA advertising you can expand your audience and scale your app brand faster.