Guest post by Kathy Pattison, Senior Vice President, Marketing, Fiksu
While every marketer faces unique challenges when running mobile campaigns, some obstacles arise so often they deserve special consideration. One of these common mistakes is the assumption that the channels that generate the greatest number or downloads or impressions at the lowest cost are the best performers, and should be the primary focus of campaign spend.
It’s any easy trap to fall into. For app-focused campaigns, for example, CPI buying is generally seen as more secure, as the advertiser is only charged when an ad leads to an installation. In those cases, the thinking goes, lower costs per install equal better performance? After all, an install is an install, right? This same more-for-less-is-better logic also extends to marketers who judge success by download volume.
Where this strategy falls down is if the users fail to interact with an app in any meaningful way. In another words, an install isn’t worth much if the app is never launched. Relying on volume as the sole metric for measuring a campaign’s success will result in overspending and a less-than-stellar ROI.
To avoid this undesirable result, marketers need to emphasize long-term value (LTV) as their primary indicator of success. To do so, they should start by identifying and tagging the events (registrations, completion of tutorials, purchases) that are associated with long-term, high-value customers. Then, as campaigns run, those defined events should be tracked in conjunction with the sources they originated from.
From there, optimize to the sources and creatives that produce the greatest amount of positive LTV returns. So, for example, if you find users from Facebook purchase at a greater rate, marketing efforts should be optimized towards it. Users from Facebook spend three times more than other users? Then you should be comfortable spending twice as much to get them in the door.
This is not to say CPI is worthless—far from it. . App store visibility is a component of many marketing programs, but the goal is ultimately LTV An exorbitantly high CPI could negate the impact of a high purchaser rate—and can often indicate the opportunity for cost savings. Instead, the idea is that by using deeper metrics to guide your spend, you virtually guarantee a better return on investment.
Learn more about this mistake and others in our ebook, The Top 5 Mobile Marketing Mistakes and How to Avoid Them.