Table of Contents Hide
- How ads work
- Getting started
- How to interpret performance metrics
- Identifying poor results and what optimizations to make
- Other ways to optimize your ads
- Using ads for Marketplace success
Ads on the Froxt Marketplace launched in February 2021 to provide a new way for app developers to accelerate their business growth by directly advertising to merchants looking for apps. For those taking advantage of this new channel, learning how to optimize ads in the Froxt Marketplace is the key to finding success.
In this article, we discuss the different considerations to take into account when planning an ad campaign for the Froxt Marketplace.
How ads work
Before we dive in, let’s take a quick refresher on how ads in the Froxt Marketplace work.
Advertisers compete in an auction on specific keywords to serve ads to merchants searching those keywords.
When you create an ad, you specify which keywords you want to bid on. When a merchant searches for that keyword in the Marketplace, an auction occurs with all participating apps who bid on that same keyword. The winner(s) of that auction gets to show their ad to that merchant.
A cost is only incurred if a user clicks on the ad, and the cost per click is the bid amount at the time of the auction.
Before you get started with ads, there are some essentials that you should have ready so that you are clear on what you want to achieve, how you measure results, and how you go about achieving these results.
To help make your first foray into ads a bit more fruitful, think about the following three considerations.
Do keyword research. This is really important because this determines your starting point for optimization—for example, do you already know what keywords your customers are searching for or is there some discovery still remaining?
Choosing strong keywords to bid on means understanding what kind of terms and phrases your potential users search for in the Marketplace. To figure that out, you’ll need to understand your users’ needs and problems at every stage of the conversion funnel, so you can figure out how to best target users at each level.
The conversion funnel
The conversion funnel is a way of visualizing the steps a user goes through before deciding to buy (or in this case, install) your product.
At the first stage, users have a specific problem they want to solve and are looking at different ways they can solve that problem. At this stage, you’re really just looking to become one of the potential solutions your user considers.
At the second stage, users have a set of features they’d like to learn more about and are searching for more information about those specific features.
At the third and final stage, users have a clear idea of what they’re looking for, and are looking for more information specifically about those offerings.
Users at different stages of the funnel search for different information, which means that depending on the stage you choose to target, your keywords will change.
Conducting market research for your app will help you get closer to your users and better understand the terms they may be searching for at every level of the funnel.
An important facet of planning your ad campaign is figuring out how much you’re comfortable spending. When you’re starting out without any historical performance data, the best way to get familiar with ads is to set aside some money to experiment with and increase or decrease the amount as you exceed or underperform expectations.
As you start to get results on how many installs you acquire at what cost, you can start to make more long-term adjustments to how much you should spend.
If this is your first time advertising on the Froxt Marketplace, you might be eligible for a $150 ad credit to get you started.
3. Key performance indicators (KPI)
The key metric for most advertisers looking to grow their installs is going to be the Cost per Install (CPI). You’ll want to start developing a performance benchmark for your own ad account. That is, keep track of your lowest and highest CPI ads and keywords, as well as your overall average CPI. Knowing these numbers will tell you what cost per install you should be striving for, and whether your overall average is improving overtime or not.
How to interpret performance metrics
On the Ads page in the Partner Dashboard, you have access to visibility, average position, CPI, CPC, spend amount, the volume of impressions, clicks, and installs metrics. Each of them tells you something different about the performance of your ads. Below, we look at each of these metrics.
The visibility metric tells you how often you’re winning a position on the first page in the auction. Generally speaking, you’ll want higher visibility where possible. Higher visibility means getting your app in front of more merchants on the first page, which means more opportunities for clicks and installs.
Typically, visibility is correlated with bid amount and relevance, but other factors can make 100 percent visibility not possible for certain keywords. These factors include relevance, overlapping bids, and others. If you’re getting an average position of one, but your visibility isn’t increasing no matter how high you bid, chances are the bid is not the limiting factor.
2. Average position
The average position metric tells you which position in the search results you appear on average. Like visibility, this is correlated with bid amount and relevance, but unlike visibility, there are no additional factors that prevent advertisers from achieving an average position of one.
It’s important to keep your CPI in mind when you look at and make adjustments to bids and keywords for the sake of improving the average position. A good average position does not guarantee a good CPI, so you’ll want to strike the right balance between a good average position and CPI.
For example, an average position of two may yield the same CPI as an average position of one. In such a case, it may not be worth it to bid the amount needed for the first position. You’ll need to experiment with your bids and monitor results to see if this is true for your particular app and keywords.
The bid suggestion is the approximate bid that is required for your app to be competitive in auction. For exact match keywords, the bid suggestion represents the bid range required for a first-page auction win. For broad match keywords, the bid suggestion represents a measure of competitiveness against other advertisers. Because broad match keywords match so many different search terms, actual performance in terms of average position and visibility may vary greatly.
Use these bid suggestions to help guide your bid setting. They do not guarantee results but are meant to give you a more accurate starting point to better performance.
3. Cost per install (CPI)
If the objective of running ads is to grow your user base, CPI is likely one of the most important metrics. Compare your actual CPI to your historical CPI range, and you have the direct measure of how your ads are performing relative to your own benchmark.
Look at where your average CPI falls in your range. What you want to see is your average CPI sitting at the lower end of your range. If not, you’ll want to identify which ads or keywords are high cost and make the requisite adjustments or optimizations.
For accounts with a lot of history that have been heavily optimized, it’s okay if the CPI sits in line with your average vs. at the lower end of the range.
4. Spend amount or install volume
CPI the metric by which you measure your success, but by itself, it can lack context. That’s where the spend amount or install volume comes in.
Some keywords can have very low or very high CPI but represent only a small fraction of your total spend or total installs. Ideally, you want to see both a high install volume or spend amount and a low CPI on the keyword or search term. Bid adjustments made to your largest spend and highest install volume keywords tend to have the largest impact.
Identifying poor results and what optimizations to make
In this section, we provide some examples of what poor results look like, and what you can do to improve them.
By itself, the low visibility metric simply shows that you’re not winning a large portion of your first page auctions, and in many cases is directly influenced by two factors: your relevance score and your bid. Raising your bid is the most direct way to improve visibility, but as mentioned above, relevance and other factors also impact visibility.
It’s best not to make changes based on only low visibility. Instead, you’ll want to look at this metric in conjunction with other indicators, like average position.
Poor average position
Poor average position is usually defined as the average position of four or greater (average impression showing up on page two or three).
Low average position combined with low visibility and medium or better relevance likely mean that your bid is not high enough. You can increase your bid to try and improve both. If you’re able to get a first-page average position and visibility, this can lead to improved performance as you have much greater visibility with merchants.
When you start to see high overall CPI (relative to your historical range), it’s a sign that you need to make some optimizations. Some causes and the optimizations you can make include:
- Continuing to bid on keywords with no installs that have a high spend amount or high impression volume. Each advertiser needs to set their own threshold for what they determine to be sufficient spend or impression volume. The solution here is to pause this keyword or substantially lower the bid as it’s not worth the cost to keep this keyword active.
- Overpaying for clicks. If your average position is already one or under 1.3, it’s unlikely that increasing your bid further will yield much improvement on CPI.
- Relying only on broad match keywords. This can lead to high CPI because of all the search terms that often match to a broad match keyword. Identify which search terms for each broad match keyword are driving installs at or below your target cost, and add them to a new campaign as exact match keywords.
If you’ve tried experimenting with bids and match types, and still can’t lower your CPI, it might be worth looking at a different set of keywords to see if you are able to acquire installs at a low cost that way.
No impressions served
When you’ve added a keyword to an active ad and see zero impressions for a given ad or keyword, there are usually four reasons. Here are some actions you can try to show ads for certain keywords:
- Very low relevance. Having low relevance does two things: increases the bid required to win auctions, and decreases your ability to participate in the auction.
- Incorrect date ranges selected: The ad was only created on June 2nd, but the date range you’re looking at is May 1 — 31.
- Low bid: Try gradually raising your bid in controlled increments to see if it’s a low bid that’s causing this.
- Keyword added as a negative keyword: If you bid on the keyword [marketing] and have [marketing] added as a negative keyword, this will prevent any impressions from being served.
Other ways to optimize your ads
Outside of the poor results identified above, listed below are some optimizations you can make to improve overall performance.
If you can’t achieve your target CPI with the keywords you’re currently bidding on, try adding other keywords from your research or from our keyword recommendations in the Partner Dashboard and see if you can acquire installs at a lower cost.
If your ads are constantly out of budget, and you feel your high-performing keywords aren’t getting as much of your daily budget, it might be worth reorganizing the way you group your ads so that your best-performing keywords get allocated as much budget as possible.
The best way to think about this is to organize your ads by performance groupings, and allocate budget according to what performs best, rather than have all of your keywords lumped together in one ad. The thinking is that some keywords perform better than others—you want to isolate and maximize how much budget is allocated to those.
Using ads for Marketplace success
We hope this optimization guide was useful, and that you’re able to identify some actionable optimizations for your own campaigns so you can better achieve your growth goals and improve your overall advertising efficiency.