Mobile Retargeting: Why it Matters More Than Ever

Last year, Apple’s App Store generated a whopping $519 billion in billings and sales. Keep in mind that the company didn't launch this platform until July 2008. So in a relatively short period of time, the App Store has not only become a huge business, but has spun off a myriad of transformative businesses like Uber, Instagram, Tinder, Venmo, and Spotify.

Despite all this, however, the mobile industry remains particularly challenging and intensely competitive for app publishers. There are millions of apps available and users can be fickle, as there's about a 95 percent churn within the first 30 days of an install.

Because of this, mobile retargeting has become a must-have. Sending personalized ads to users can re-engage them — e.g., with app visits or in-app activities. Or if a user has already uninstalled the app, he or she may consider trying the app again. Consider that The State of App Retargeting 2020 Edition points out that, on a global basis, 30 percent of apps run retargeting campaigns (for the past year). The report analyzes a variety of key verticals. For example, photography apps reported a 250 percent spike in the share of retargeting conversions last year. There was also 50 percent-plus growth in finance, food and drink, and hard-core gaming apps.

Note that the report covers both paid and owned channels. Interestingly enough, owned media grew by an impressive 60 percent last year. However, this shouldn't be surprising since the costs of this channel are negligible.

However, there were categories that did lag. Just look at Casual Gaming, which posted a 25 percent plunge in retargeting conversions.

Then again, there's a good reason for this: the games generally have short usage periods. This is because users frequently check out new offerings. This makes it difficult for a retargeting campaign to get much traction.

By comparison, there has been robust growth in midcore, hardcore and social casino games. Yet all of these have long spans, which could go on for years.

Here are some other notable findings in the report:

• Retail marketers are leaning into retargeting. The shopping vertical’s adoption of retargeting share surged 35 percent from 2018 to 2020, to reach no less than 65 percent of conversions.
• COVID-19 has increased retargeting success in the shopping vertical. As lockdowns began, shopping apps saw owned conversions increase almost 50 percent.
• Retargeting has become a must-do across verticals. Almost four in 10 apps running retargeting have a share of retargeting that exceeds 30 percent, and 65 percent of conversions within shopping apps come from retargeting.
• Marketers lean on owned media retargeting. Owned media retargeting increased 60 percent from 2018-2019, and is popular for bringing users back at a very low expense.

The COVID-19 Factor

The report analyzed the impact of the COVID-19 pandemic by dividing the data into two time frames: a year-over-year comparison from January to February and a look at the end of February through April 2020. There was also no coverage of the travel vertical because of the big drop in activity.

The bottom line is that the pandemic hasn't slowed retargeting. Because of the lockdowns, there was actually an increase in app installs. For the most part, marketers didn't want to miss out on the opportunity to engage their users, and ramped up their retargeting efforts.

Conclusion

Again, as seen with the huge revenues from Apple’s App Store, the mobile world continues to be a source of growth — and this is likely to continue for some time. There will certainly be more mobile-first startups that disrupt massive industries. However, there will also be traditional businesses that transform themselves.

Achieving traction with mobile is getting tougher. This is why retargeting is essential for anyone’s marketing toolbox.

Mar Brandt is senior vice president at AppsFlyer, the global leader in mobile attribution.