In today’s post, we share Black Friday 2021 and holiday mobile app advertising best practices and insights:
- Expect to see CPM increases of 30-40% between Black Friday and Christmas across social channels.
- Non-eCommerce advertisers should consider reducing spend from Thanksgiving until December 26, 2021, and then accelerate into January to take advantage of CPM drops.
- Bulk up on creative production and testing to have enough high-performing assets for late December spend increases.
User acquisition in mobile app advertising is always fiercely competitive during the holiday season. However, last year UA managers could reliably build LTV models and scale profitable iOS spend using lookalike audience targeting. But with the loss of IDFA, mobile advertisers hoping to succeed in the Black Friday 2021 fray are facing a uniquely challenging holiday season. The devastating impact of IDFA loss and the erosion of lookalike audience targeting has affected revenue across the mobile app industry and the holidays won’t be any easier. Additionally, the normal CPM drops that happen on December 26th didn’t happen in 2020 mostly due to advertisers maintaining spend to get ahead of then-pending IDFA removal.
CPM Trends for Mobile Apps in the U.S. (Optimized for Installs)
Perspective on the mobile advertising ecosystem
The Wall Street Journal recently highlighted how the loss of IDFA has impacted ad networks differently in Q3 2021: “Google, the world’s largest digital-ad company by revenue, tallied its highest sales growth in more than a decade in the third quarter.” Other social ad networks were negatively impacted by IDFA loss, supply chain disruption, and labor shortages. A dozen eCommerce companies interviewed by WSJ reported they now must spend a lot more money on ads to get the same number of sales prior to IDFA loss. Without enough data to know how effective ads were at driving purchases, many eCommerce companies reduced their ad spending. In a July poll of 118 e-commerce store owners by eCommerce Fuel, 62% said they had decreased their Facebook ad spending since the loss of IDFA.
UA and Creative Best Practices for Black Friday 2021 and Beyond
To supplement our Q4 Creative Best Practices for Facebook, Google, and TikTok, we bring you Consumer Acquisition’s Guide to Post-IDFA Holiday UA. Based on our experience managing over $3 billion in creative and social ad spend, we are sharing insights on mobile ad trends to maintain advertising efficiency through the performance peaks and valleys of the holiday season, including Black Friday 2021.
Riding the Q4 2021 CPM waves
Since 2019 we’ve seen a decrease in CPMs right before mid-November. With eCommerce and brand advertisers reserving their budgets for Black Friday 2021, there is less competition causing CPMs to go down right before the holiday burst. This year, the decrease may be more extreme because the advertising ecosystem is impacted by IDFA loss.
We consistently see CPM increases of 30-40% between Black Friday and Christmas. CPMs then decline immediately after Christmas and typically stay lower through the middle of January, marking the lowest time of the year. With eCommerce advertisers putting major budgets behind holiday retail, most non-eCommerce advertisers can gain efficiency by reducing their spend until after Christmas and then accelerating into January.
After gifts have been exchanged, many consumers turn on new phones and load mobile games and apps. As retail and eCommerce pull back on their marketing budgets, other mobile app advertisers can take advantage of what we dubbed as Q5 last year. Q5 referred to the 10-day period starting on December 26th and running through about January 10th. We recommend gaming, entertainment streaming apps, meditation and fitness apps, DTC, and others to bulk up on creative production and testing to have enough high-performing assets to take advantage of the CPM drops during this time. After Christmas is a great time to target new device users, and device-specific creative can result in an extra relevance bump. If you’re going to spend money in December and you’re not an eCommerce company, try to save your spend for the last week of the year.
Mobile Traffic Replacing Foot Traffic
Last year due to COVID-19, foot traffic to stores was down 33% from 2019. This accelerated a move to online advertising for retail businesses during the holidays. We saw eCommerce brands advertising as long as possible on Facebook and Google during the holiday shopping season to make up for the loss of foot traffic. This year, while brick-and-mortar stores may have more foot traffic than 2020, predictions are still 10-15% lower than 2019. Therefore, we expect increased interest in mobile advertising to persist across categories. First-time eCommerce spenders who successfully entered the mobile advertising ecosystem last holiday season will likely participate again this year.
“It’s well established that mobile social media is vital for product discovery,” says Vincent DeSantis, director of Retail Facebook Business Group. “And best-in-class retailers have learned that their online shopping experience must be, well, experiential. They’ve taken the “wow” factor from their stores and brought it to life in their customers’ mobile feeds.”
WPP, the world’s largest advertising group, lifted their sales forecast for the third time this year, based on strong advertiser demand in Q3. Another sign of a robust holiday advertising season, advertisers want to capitalize on the global economic recovery from the pandemic. This past August, WPP reported they had reached 2019 business levels a year ahead of plan. Chief Executive Mark Read said the uplift was well beyond cyclical recovery from the pandemic, giving them “confidence that there’s momentum in the business.”
While the U.S. travel industry is showing some signs of recovery, American travelers are choosing houses over hotels, and local adventures over international destinations. This poses an additional opportunity for mobile app advertisers to reach millions of people staying in or staying home. Gaming, entertainment, health, and fitness can all enhance time at home. Similarly, people staying home turn to shared experiences on social sites like Facebook, Google, Snap, and TikTok. We expect social platforms that offer a way to play and engage with friends and family will continue to surge.
As the cost to acquire a user/customer rises due to CPM increases and loss of targeting and measurement, advertisers can preserve profits by raising that acquired user’s value. Bundles, premium features, and tiered spending discounts (spend $X to get a percentage off) are all ways to increase average order value. Fortunately, this behavior maps perfectly to Q4 consumer activities. People are already spending more, both on themselves and others.
Focusing on Android
Even prior to IDFA loss, we tested on Android because it was less expensive and easily translated to iOS. We saved iOS testing for the rare clients without an Android app or those who were solely targeting iOS users. Testing creative for both IAP and IAA continues to work effectively on Android.
Fortunately, advertisers with Android apps who are NOT using Facebook’s AAA algorithm can follow our A/B testing best practices and maintain their deterministic efficiency. Advertisers maintain the ability to A/B test and see results at the individual asset level. Once a winning creative is identified, move it to iOS or other paid social platforms.
Much of Google’s sales success in Q3 2021 came from the value of knowing a user’s intent: a search term reveals their interest or motivation. Other social networks that rely on app and web tracking are working through the complexity of losing deterministic targeting and measurement. Mobile advertisers that tailor ads to user motivations through persona-led ad creative, can scale efficiently and profitably by focusing on the positive attributes of contextual advertising while growing high-quality top-of-funnel installs.
We have performed over 100,000 A/B and multivariate tests on Facebook, Google, TikTok, and Snap and have learned that 85-95% of new creative concepts fail to outperform your best ad. We also learned why it can be hard to beat your control video. So how can you keep those creative concepts coming?
Consumer Acquisition’s Ad Concept Model is designed to systematize creative development and UA targeting based on iterative testing. Our model ensures advertisers always have new creative concepts to stay ahead of creative fatigue. From niche to mainstream, our creative concepting model means our clients get reliable top-performing creative in the most cost-efficient and scalable way. The model can help you:
- Systematize creative concepting
- Utilize user motivations to tailor ad creative
- Use creative trends and user motivations to create defined paths for new ad concepts
- Find the creative trends popular within specific categories
Why trust our recommendations?
Our market insights and creative expertise come from managing over $3 billion in creative and social ad spend for the world’s largest mobile apps and web-based performance advertisers. Since 2013 we’ve worked with Roblox, Glu Mobile, Disney, SuperHuman, Rovio, Jam City, Wooga, NBA, MLB, Ford, Sun Basket, Lion Studios, MobilityWare, and many others. We provide end-to-end creative and user acquisition services for mobile app marketers via performance-oriented creative storytelling, integrated UA, and creative optimization.
Contact firstname.lastname@example.org to discuss our user acquisition and creative services.