In-App Ads Key Element of Digital Marketing

Marketers are embarking on this mode of advertising apart from other channels to further fuel their revenue and capture a larger consumer audience for their brands.

Mahek Shah, who is head of media at airasia Move, told StarBiz that in-app advertising has emerged as a pivotal strategy for marketers and its remarkable efficacy in capturing a broader consumer audience.

She said this surge in the adoption of in-app advertising aligns seamlessly with the contemporary trend of prioritising a mobile-first approach.

“As consumers increasingly dedicate a significant portion of their time to mobile applications for daily activities and lifestyle needs, the inherent engagement within these apps makes them an ideal platform for advertisers.

“A critical facet of in-app advertising’s success lies in its capacity for precise audience targeting in a cookieless world.

By leveraging both deterministic data, such as first-party data, and probabilistic data, advertisers can tailor their campaigns to precise target audiences by building right cohorts. This enables the continuous improvement in their advertising strategies,” Mahek noted.

She agrees that in-app advertising should be complemented with other forms of advertising. She said relying solely on in-app advertising may not suffice for brands.

While in-app advertising is effective in targeting a specific audience within the mobile app ecosystem, she said a more comprehensive marketing strategy is essential for reaching diverse consumer segments.

“Incorporating in-app advertising into a broader spectrum of traditional advertising methods forms a well-rounded and integrated marketing approach. This diversified strategy ensures that brands not only engage with active mobile app users but also connect with audiences less immersed in the mobile app environment.

“While in-app advertising is a potent component of a digital marketing strategy, its integration with other forms of advertising is imperative for a holistic and impactful brand promotion,” Mahek said.

Resorts World Genting (RWG) senior vice-president of sales and marketing Spencer Lee said this channel of advertising allows marketers to gain more insights on the customer journey of targeted users with profiling data.

To this end, brands are able to be identified on viewer’s activities such as browsing and purchase patterns, he added. Lee also leads the digital team at RWG.

At the same time, he said it allows for higher conversion rate, noting that advertisements can be reached out to preferred targeted audiences which can lead to higher purchase rate and boost engagement rate as well.

A recent study by Pubmatic, among others, found that 70% of Asia-Pacific marketers are spending on in-app advertising, with eight in 10 marketers seeing improved brand awareness and are paying off for brands.

At 88%, Singaporean buyers are most likely to buy in-app, while Japanese buyers are doing far less in-app buying, at just 47%. Across countries, performance-focused buyers are more likely to advertise in-app than brand buyers, at 77% and 60% respectively, it noted. Pubmatic is one of the world’s leading scaled digital advertising platforms.

A great opportunity

The Association of Accredited Advertising Agents Malaysia (4As) acting president Ryusuke Oda said with a demographic of 30 million smartphone users, by volume this is definitely a great opportunity for brands to reach out to a wider audience.

“There is no straightforward way to determine whether a channel is truly effective, it really depends on numerous factors such as campaign objective, overall accompanying strategy as well as the creative feature.

“At the end of the day, it is another media channel, similar to YouTube, website banners, social media ads etc. Therefore, the same considerations are needed,” he said.

He said a holistic approach is always ideal to drive consumers down the marketing funnel, from consideration up to purchase and beyond. In terms of branding, this touchpoint alone is not strong enough to build trust.

“Currently, in-app advertising allows reach and awareness, and even direct eCommerce linking. But in general, it may lack credibility as a platform due to less ethical advertising.

“Therefore, advertisers should still utilise a 360-degree approach to reassure their audience and provide the information they need in order to convert to the brand,” said Oda, who is also Hakuhodo Malaysia managing director.

Complementing the market

IPG Mediabrands Malaysia chief digital officer Cindy Eliza Vaz said there is no one-size fits all with advertising, especially when the digital ecosystem in Malaysia is so diverse, with users accessing multiple apps in a single day, and spending at least eight hours a day on the Internet.

“In-app advertising in a mobile-centric market such as Malaysia should be complemented with other forms of advertising to give a more holistic and effective marketing strategy. This combination ensures a wider audience reach across various demographics and preferences, not limited to just mobile app users, for 360 campaign coverage,” she noted.

On the prospects of in-app advertising in Malaysia over the next few years, Vaz said the future of this mode of advertising in the country over the next three to five years seems bright.

She attributed this to the high mobile penetration, and the increasing use of popular social media platforms, accessed predominantly via mobile apps, provides a large audience for in-app advertising.

Looking in the long term, she said the young, tech-savvy population in Malaysia is likely to continue embracing digital technologies, including mobile apps.

“Growth in eCommerce and the availability of super-apps and e-wallets, with a significant trend towards mobile shopping, presents opportunities for in-app advertising to influence purchasing decisions in a bigger way.

“Additionally, the rise in digital media spending indicates a shift towards digital content consumption, where in-app advertising can be effectively integrated,” Vaz added.

RWG’s Lee said moving forward in-app advertising would see growth as more companies are aware of the possibility of reaching their target market through mobile applications.

“In-app applications allow brands to access targeted audiences based on targeted criteria ie: age, gender, location etc. due to target audiences’ high dependencies on mobile device usage in their daily life.

“More brands are moving to mobile channels for advertising options resulting in mobile ads more cost effective and accessible,” Lee said.

Low level of regulation

On a different note, Oda said the challenges for marketers using this channel of advertising, among others, is the low level of regulation which allows the influx of in-app advertising by almost anyone.

“This opens a plethora of unethical practices that may lead to scams and unlawful activities such as gambling. This could somehow lead to a lower credibility of this platform and deter brands from utilising this method of advertising.

“Most brands are seen utilising this space as a platform for more reach and impressions, as the platform is part of an overall digital and programmatic buy. The nature of the ads are generically used across all digital channels.

“Whilst this is good for consistency, it lacks the necessary hook that truly captures an audience’s attention.

“To do this effectively, it would require more creativity, but the question will come back to the return on investment for the brand. Which goes back to the holistic approach needed in the advertising space,” Oda noted.

Mahek said in the realm of in-app advertising in Malaysia, marketers may encounter hurdles such as fragmented platforms, where not all in-app ads are easily accessible through programmatic buys.

Additionally, she said challenges like ad fatigue, data privacy apprehensions, the need to establish industry-standard measurement metrics, and combating ad fraud and ensuring viewability further complicate the landscape.

“Overcoming these obstacles requires marketers to adopt a strategic and adaptive approach to effectively implement and optimise their campaigns in this dynamic environment,” she said.

Source Credit: https://www.thestar.com.my/business/business-news/2024/01/29/in-app-ads-key-element-of-digital-marketing