On the heels of forecasts by research firm eMarketer that Facebook is losing younger users at an alarming rate (2 million users under the age of 25 will flee the social network in 2018), the question arises: which rival network will benefit from the shift?
When it comes to social media interaction, eMarketer places its bets on Snapchat and Instagram, noting that Snapchat may get the edge over Instagram and even attract more older users thanks to a redesign that emphasizes ease of use.
But social networks are more than spaces where people connect and communicate. Facebook, in particular, is also an advertising platform that is insanely successful at driving mobile app installs. In this scenario, Facebook app install ads, which look like posts from friends, expose users to apps they are likely to love and download. Mobile app marketers can choose to pay only when someone actually installs the app. (And they have to take Facebook’s word for it, by the way.)
Overall, it’s a lucrative business that is seeing explosive growth, which is why analysts at Citi reckon Facebook was responsible for over 4 billion cumulative downloads in 2017. But new data from Berlin-based mobile measure and attribution company Adjust reveals that Facebook may be the ad network bringing app users in early on, but Google is the ad network that is keeping them engaged.
Tracking premium ad network performance
The Mobile Benchmarks Report 2018 draws from Adjust internal data from January 1, 2017, through December 31, 2017, data that spans 1.29 trillion events, and 10.7 billion installs across 11,000 apps.
The report is chock-full of compelling numbers and insights around app activity and performance, which it breaks down across categories, regions and operating system.
But the hidden gem is the data that looks at the quality of an app install (measured in events) delivered by the top premium ad networks: Facebook, Google, and Twitter.
Courtesy of Adjust
Data suggests Facebook might be a better source of users for app marketers that want quick wins, but Google is the better long-term bet.
Over a typical month period Google, not Facebook, is the network that brings in the more engaged users. Specifically, users from Google are ahead in events–to the tune of one event per app per day. Put simply, Google averages nine events per day, and Facebook trails with eight.
If you don’t think one event is significant, then think again. That one extra click could be a purchase for a commerce app, a booking for a travel app, an order for a food delivery app or just an ad impression for an entertainment app.
Facebook kicks off with high engagement, a real plus for app marketers in categories such as Casual Games where wins have to be quick because user attention spans can be short. However, for marketers with apps that build momentum and retention over time, Google is what the Adjust report calls the “better bet.” Indeed, the report states, user interest is slightly higher initially, but “it drops a little quicker too.”
Google may have a leg up on Facebook when it comes to longer-term app engagement, but app marketers also complain performance comes at a price. Google’s move to migrate advertisers to Universal App Campaigns (UAC) in Google AdWords (effective November 2017) may make it easier for app marketers to drive installs, but it also makes it harder for them to control campaigns and their outcomes. Before it was up to app marketers to make informed decisions on targeting, bid adjustment, ad creative, ad scheduling and device allocation. Now all these tasks are the domain of Google, which optimizes ads on behalf of marketers and shows them across Search, Display, and YouTube.
It’s a “black box of advertising” that has Oliver Kern, noted growth guru and advisor to a number of mobile game startups, wondering if the results are paying dividends or costing budget. “Google has a very deep understanding of user behaviour because it owns the (Android) operating system,” Kern tells me. “Visibility into how people use their devices and apps allows Google to constantly improve their advertising platform so that advertisers can get more value from their advertising spend.” But there is a trade-off.
Currently, Kern explains, Facebook is hands-down the platform for marketers to acquire the valuable users that allow them to “kickstart a campaign in a successful way.”
Google, on the other hand, is where Kern sees marketers (himself included) have to “waste a significant budget in order to train the Google algorithms to target and address the high-quality users that spell high performance for user acquisition and engagement campaigns.” It’s a learning curve that can try marketers’ patience and syphon budget. “It takes some time before I see good results in Google, and the lack of transparency makes it doubly hard to wash, rinse and repeat my success.”
Positive engagement trends
The lack of transparency across all ad networks is a major marketer complaint and the main reason why Adjust is determined to shine a light on performance data it sees from its unique vantage point in the mobile ad ecosystem. (It’s also why Adjust is spearheading the Coalition Against Ad Fraud, an industry organization of 15 mobile ad networks and app marketing platforms with the common purpose of fighting mobile ad fraud.)
Significantly, the Adjust benchmarks report has good news for all networks. It observes that “across the board, user engagement increased over time, regardless of source.” The upshot: 2017 was a banner year for app retention overall, even if it did see Facebook lose its dominant position.
“Compared to 2016, we’ve seen an increase in retention, by as much as 10% on Day 1 after the install, and 5% by day 30,” Adjust Co-Founder Paul Mueller tells me. After seeing a lower performance in the company’s 2016 benchmarks report, Mueller says the market is firing on all cylinders. “With our new findings, we’re back to 2015 levels, where, for instance, Gaming apps retained around 40% of their users for a day after install.” In 2016 Adjust reported this figure was closer to 30%.
The latest data from Adjust joins the body of must-read material app marketers should factor into their strategy as they map out user acquisition campaigns and allocate budget.
The numbers suggest Google is a better bet for apps that are in for the long haul, but marketers that want quick wins might want to stick with Facebook. Either way, it’s a trade-off. But there is one constant to consider: the lack of transparency across all ad networks. Fortunately, Adjust—a company on a mission to give marketers a “full picture” of app performance– will continue to call them as it sees them.