The underlying design logic of App brand advertising

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This article uses a typical brand advertisement - splash screen advertisement , to explain in an easy-to-understand way the changes in commercial product managers in recent years. A more complete novel content will be interspersed in the middle to make it easier to understand.

This article/series will be quite long, so it is recommended that you follow and subscribe, or bookmark it and watch it multiple times.

The knowledge points that must be mastered in this article (you can skip if you have any):

• Brand Advertising-CPT Advertising: Cost Per Time, only supports brand advertising. It originates from offline brand advertising in the last century, such as bus stops, curtains, etc. Offline advertising is often counted on a monthly basis. After migrating online, in most cases it does not refer to the concept of days, but more to ensuring exposure, such as 1,000,000 exposures; there is also visibility, and the display position is stable.
• Brand Advertising-GD Advertising: Guarentee Delivery, only supports brand advertising, evolved on the basis of CPT, supports targeted exposure guaranteed SHOW delivery, and is lighter.
• CPM advertising: Cost Per Mille, generally a bidding advertisement, the billing point is charged based on the thousandth impression, that is, the advertiser pays for one thousand impressions. In addition, CPM also means unit, referring to the concept of one thousand exposures or 1,000 shows.
• CPC advertising: Cost Per Click, only supports bidding advertising , the billing point is the click charging method, that is, advertisers pay according to each click.
• eCPM : effective Cost Per Mile, from the platform's perspective, the revenue per thousand impressions. The most important core concept in bidding advertising and even brand advertising is used to measure the value/cost of each traffic. It is the final intermediate influencing indicator of various regulation strategies, traffic strategies, and interaction strategies.
• Incentive advertising: advertisements in which users can obtain certain rights after actively watching the advertisements, such as watching ads in novels to avoid 30 minutes of interstitial ads, watching ads in games to get resurrection cards, watching ads on the main site of the App to get gold coins, etc. It is the key advertising form currently at the forefront of competitive bidding.
• R&F: Reach&Frequency , a method of joint investment in brand performance advertising, which means charging according to the number of reaches, that is, advertisers pay based on the reach of the same user within a period. For example, users are reached 7 times in 30 days and 3 times in 7 days.
• BLS: Brand Lift Study, measures the true value of an advertising campaign through a scientific A/B diversion experiment (Group A is exposed to ads, Group B should be exposed but is not) and the specific form is to distribute questionnaires based on statistics.

1. A look at the advertising world

1. The status of advertising

Advertising can be said to be one of the most important business models on the Internet , which is basically beyond doubt. Including Baidu, Tencent, ByteDance and even Alibaba, they all rely on traffic-advertising monetization methods to make a fortune.

Using the two pictures below ( picture source: Huang Youcan’s "Youcan Academy", thanks for the in-depth and easy-to-understand compilation ), we can have a good understanding of all the monetization methods on our C-end Internet, among which advertising is the mainstay (originating from offline Marketing in the last century).

Since the launch of "mobile Internet" in 2013, advertising has ushered in the most crazy harvest and dividends. In addition to small and medium-sized companies, the most typical example is the rise of ByteDance, which is inseparable from the positive growth of traffic-advertising.

This article uses the most typical and common "splash screen" ads in brand advertising as an example to analyze how a commercial product manager actually designs products, including the impact of changes in supply and demand and changes in advertisers' mindsets as the times change (from 2013 to the present).

Therefore, next I will focus on "splash screen ads" and share the underlying design principles of brand advertising in recent years through 1 formula, 2 perspectives, and 3 drill-down points . At the same time, I will intersperse some original and fabricated "novels" in the middle to help everyone understand.

Without further ado, let me first present the conclusion (a formula I summarized).

An APP that earns revenue from advertising:

=SUM( user value x space x style x creativity x traffic strategy ) gain - SUM( user life time ) loss

Example:

a. Information flow advertising revenue = DAU * IPU (how many ads each user sees on average) * AdsLoad (the proportion of information flow advertising) * SSR * CPM2 (or broken down into CTR2 * ACP)

b. Search advertising revenue = PV * PVR * ASN (number of ads that appear in the search term) * CPM2 (CPM2 or CTR2 * ACP)

Let’s use this formula to deduce the development of “open screen ads”

2. Micro brand advertising - taking splash screen advertising as an example

Chapter 1: 2013-2016 - Splash screen advertisements blown out by the strong wind

(1) Platform perspective version 1.0 formula

Benefit = User Value * Space * Style

Supply and demand relationship: supply (referring to user attention) < demand (referring to advertiser marketing)

The design focus of this stage is: supply exceeds demand, and expand inventory to sell.

① User Value: Selling every exposure (called show/inventory in the industry), that is, selling PV, maximizes profits. This results in users being likely to see the same ad repeatedly at the same location, and even seeing it twice within 5 seconds is counted as two exposures. This practice is still applicable to many small apps/websites in 2021. Even the opening point of the screen will shorten the interval between each user watching the advertisement, so as to achieve the goal of selling more PVs.

② Space: Develop advertising spots as much as possible, including the splash screen, information flow, banner, last frame of the details page, and other places that can be filled with ads.

③ Sales form: CPT sales, the PV level of a certain point is sold according to a certain unit price, such as 40 yuan/thousand exposures.

(2) Advertisers’ perspective: buy or give up traffic for this APP

The purchase is made by a group of people and the purchase amount is large.

①Who will buy it: Generally only large companies/brands, multinational groups, such as Estee Lauder, Mercedes-Benz and BMW, etc.

②How to buy: adopt budget allocation system and contract procurement.

An ad in a prime position in an APP's information flow is sold for 30 yuan per thousand impressions. Assuming the DAU can provide 15,000,000 impressions a day (assuming that each person views it 3 times, it actually only covers 5,000,000 users), then you can reserve all the attention of this space on a certain day in the future by placing an order and paying in advance, with a total price of 450,000 yuan (excluding discounts).

③How to measure advertising effectiveness: Theoretically, it affects the user's mind, but in reality, there are only data on exposure (SHOW) and click-through rate (CTR). Similar to offline large-screen advertising, advertisers can only choose to trust.

(3) Attached: "The Ultimate Way to Make Money from the Splash Screen Ads in APP Factories" - Chapter 1: Splash Screen Ads Blown Out by the Strong Wind ( Original Fiction)

This was the first decade of the 21st century, and it was no less bloody than the martial arts world. The imported product "Internet" attracted many heroes to join in China. In later generations, a big man named Lei said that these people were people who followed the trend and were slightly better than pigs. Advertising became a huge profit point. At that time, it could be said that there was no content in the advertisements on the Internet.

Who could have thought that the wind would come even more violently in the second decade, when smartphones brought about the so-called mobile Internet. It was the same group of Internet people who were so smart that they exclaimed as soon as they smelled the smell: I know this! Add advertisement.

Insightful Internet people pursue demand, traffic, and user experience. They discovered an experience problem at that time and even today: the Internet speed is too slow. It takes 5 seconds to start the APP. Emmmm, it’s not good to wait for 5 seconds. It’s better to add advertisements.

Among them, the most representative figure is a man named Zhang. He is a man of deep thinking, foresight and pursuit of efficiency. He resolutely decided to add advertisements in his app, including on the opening screen. Who would have thought that it was this decision in 2014 that created the largest unicorn ten years later.

"How to add advertisements?" a question came from the Toutiao conference room the next day.

“It’s just 5 seconds, and it can only be sold by exposure,” said the person in charge of commercialization.

"I think it affects the user experience..." someone questioned.

"Let's do the math. If we sell 1,000 impressions for 10 yuan, and our current Dau is 1 million, and each user opens their phone once a day, we'll make a net profit of nearly 4 million yuan a year." The head of commercialization interrupted, "And we can raise the price. Besides, a user will watch more than once a day."

The conference room fell silent. In this way, all PVs on the opening screen of Toutiao the next day were sold as advertisements, based on a contract, once a day.

…

In just a few years, Toutiao became popular and its DAU increased tenfold.

In 2016, an e-commerce brand owner wanted to buy the opening screens of major apps to "dominate the screen." What he didn't expect was that the price had reached 50-70 yuan per thousand exposures, and all PVs were randomly divided into N equal parts. The total price of one part was ridiculously high. There were not many parts on weekdays, not to mention that important marketing nodes had already been booked by others.

Chapter 2: 2017-2018 - GD advertising broken down into smaller pieces

(1) Platform perspective 2.0 formula

Revenue = User Value * Space * Style * Traffic Strategy

Supply and demand relationship: DAU is increasing rapidly and the supply of user attention is increasing. Supply <= Demand

The design focus of this stage is: crowd premium, launching GD ads, selling more information about users, raising prices by 10-20%; optimizing C-end ad display interaction.

① User’s own Value: drill down to the user’s value and sell at a price. Although PV is still sold, the construction of DMP supports advertisers to target user attributes, such as gender, region, and population groups. However, on the one hand, this function charges an additional fee of 10-20%, and at the same time lowers the threshold, with the minimum purchase threshold being 100,000 impressions. However, this type of GD advertising cannot guarantee the position where the advertisement will appear.

② Style: Finalize the most basic interaction logic. For example, after AB experiments, it is determined that the button will appear 3s after the information flow video is played, and the best effect is that the button appears after 7s.

Extended meaning:

1) Will the AB experiment be more effective if the advertising elements have more content, a larger proportion, and are more native? NO, Baidu search ads and information flows have tried at least 30 combinations of elements, and ultimately the style that can maximize ecpm is still the simple information-focused style that has the best conversion effect, which is some of the common styles that everyone sees now.

2) In 2021, the focus of major companies will be on providing a thousand faces for a thousand people. Each element of each position will be broken up, and a candidate set of elements will be piled up. The algorithms will select them, and the A/B returns will be positive.

Summary: The innovation in style makes good use of the characteristics of each space, allowing users to easily exchange cognitive capacity and information.

③ Traffic strategy: fair distribution strategy for both CPT and GD ads on the opening screen, information flow GD avoids opening bidding ads through algorithms to ensure maximum market returns

④ Sales form: CPT/GD are sold at the same time, and the price per unit is generally increased. The opening screen price has increased to a minimum of 50 yuan/1,000 impressions, and the information flow price has increased to 40 yuan/1,000 impressions.

(2) Advertisers’ perspective

ByteDance traffic is getting bigger and bigger, so we need to seize the traffic quickly. However, CPT is too expensive. We can choose GD advertising with a low threshold, which is targeted but has poor visibility.

① Who will buy: Introduce more small and medium advertisers to try brand advertising

②How to buy: basically unchanged, still based on contract. For example, the GD ads in a certain APP information flow are sold at 30 to 40 yuan per thousand impressions. The total price can be calculated based on the volume that the advertiser wants to purchase, and the ads can be put on the market after payment is made.

③How to measure advertising effectiveness: through exposure (SHOW) and click-through rate (CTR) data; based on the users who are actually exposed to the advertising, provide customers with a user attribute analysis report of the hit users - discover that the advertisers are not so easy to deceive, and start telling stories.

(3) "The Ultimate Way to Make Money with the Open Screen Position of APP Factory" - Chapter 2: GD Advertisement that is Broken Down into Small Parts (Original Fiction)

“What should we do now? DAU is growing too fast. It’s totally not feasible to divide the splash screen PV into three rounds. Many customers can’t even afford one round. Our sales rate continues to decline. Should we continue to divide the rounds?” The next day, the debate about splash screen ads rang out again in Toutiao’s conference room.

“It has to be demolished, but what’s more important is to find a fundamental solution.” A deep voice sounded, and everyone stopped discussing and looked at the man who had been sitting in the main seat and had not spoken the whole time—the man who had decided to be the opening screen advertisement for the next day’s headlines.

"Essentially, customers think that the user value they buy is too low, and at the same time, the sales threshold we set is too high. In this case, we will simply break it down into smaller units and sell it as a minimum of 1,000 impressions. Refinement is the trend, and the targeting capabilities of bidding are now mature. Let's introduce brand advertising this year," he paused and continued.

"If there is no threshold at all, the technical risk is too high, and too many small orders will result in insufficient sales," the technical director had to say, "Should the minimum order be 100,000?"

"Okay, that's it. By the way, remember to discuss the pricing after the meeting, and sell it at a price that's at least 10% higher."

"Boss, how do we allocate traffic? If we buy too little, should we downgrade the priority?"

"Of course it's still randomly divided. It's reasonable that the probability of display is low when buying less. It's a simple logic. You can't give rotten apples to the former and good apples to the latter just because you buy a box of apples and a truck of apples, right?"

The final word was given, and the opening screen GD advertisement appeared on the headlines the next day.

…

This year, splash screen ads are still annoying in the eyes of most users, and there are more and more types of them, all kinds of brands that have never been heard of have appeared. But for many small and medium-sized advertisers, this is good news. They can spend a few thousand yuan to have their products appear on the startup page of a national-level APP, which gives them both face and value (an extremely high click-through rate of 9%).

Chapter 3: 2019 - 100 Months of Bonus Money Announced

(1) Platform perspective version 3.0 formula

Revenue = User Value * Space * Style * Traffic Strategy * Creativity

Supply and demand relationship: DAU is increasing rapidly, the supply of user attention has increased significantly, supply > demand.

Design focus: style premium, increase unit price; initial attempt to shift from ensuring show to ensuring reach & frequency, which in theory will significantly reduce platform costs.

① Style: Focus on innovative styles and harvest customer budgets. Douyin Toutiao launched the Topview series (information flow linked to the opening screen). The excellent effect of Douyin attracted the budget of billions and won the company's 100-month bonus that year. This year, the opening screen advertisements on the entire network were fancy and all kinds of ingenious interactive designs emerged.

② Creativity: In addition to compliance and legal review, an independent creative team is established. Evaluate the quality of creative materials provided by advertisers, especially the extremely high standards required by Topview.

③ Sales method: In addition to CPT/GD, we began to try R&F sales method.

(2) Advertisers’ perspective

Different types of products can be purchased, but they are increasingly dissatisfied with brand measurement and price value, and are increasingly interested in innovation and content marketing. Smart small and medium-sized advertisers have begun to spend money on cooperation with influencers, that is, the marketing strategy of 3,000 Xiaohongshu and 5,000 Douyin and Kuaishou videos.

①Who will buy: The customer base remains unchanged.

②How to measure advertising effectiveness: exposure (SHOW) and click-through rate (CTR) data; provide customers with a user attribute analysis report on the hit users based on the actual exposure of the users; performance advertising is prevalent, so provide some brand and effect joint delivery solutions.

(3) "The Ultimate Way to Make Money at the Open Screen Location of APP Factory" - Chapter 3: 100 Monthly Bonuses Go to the Open Screen (Original Fiction)

The time came to 2019, and the next day Toutiao was called an APP factory by the outside world. The rotating flywheel of "user side-User Growth-commercialization" not only brought unbeatable cash flow, but also created a truly national-level application - Douyin.

"I am a new employee," a confident voice appeared in Douyin's work area.

Ji Guang looked around the crowded and small work area. Everyone was talking incoherently with headphones on. Obviously, he was being ignored. Embarrassed, he took out his cell phone to contact his supervisor before sitting down. It seems that the app factory is not simple.

“Topview must be promoted this year and developed to the highest quality. Based on the results of the first phase online, customers from many industries are buying it. If the second phase is not sold after it goes online and you come to me, if there are not enough resources, then we can escalate the discussion,” Jiguang’s supervisor shouted as soon as he returned to his workstation.

Later, Ji Guang learned that the splash screen advertising strategy that year was to lead the industry and redefine the splash screen based on Douyin. Indeed, it was done.

I don’t know who came up with the idea of ​​Topview, but it’s a simple video content that opens the screen and continues to play in the information flow. But the real soul lies in the "sound", which amplifies the sound of Douyin's own full-screen information flow, breaking the premise that splash screen ads cannot have sound.

This simple interaction is rumored to be worth 100 monthly bonuses, which shows that he is indeed quite skilled.

…..

"Jiguang, do you want to work on the third phase of Topview or participate in another new project R&F?" the supervisor asked

What is R&F? New project? emmm adult "I can do it. I have more energy now," Ji Guang replied youthfully.

“Okay, but you should focus on the third phase optimization. I’ll take you to listen to R&F when I’m free. It’s also a strategic project that aims to revolutionize this industry and redefine user value,” the supervisor said after a moment of silence.

"No problem, how about the third phase?" Ji Guang asked naively.

"This is something you need to think about on your own. It's already relatively complete now, and you can try to innovate on this basis. Run the data and make a demo for the customer to see and get their feedback. Then we'll review it at the meeting next week," the supervisor frowned.

“Okay…” That day was Sunday.

User Value Drill-down Attempt 1: "Reach&Frequency" is also a popular and mature method abroad (launched in China at the end of 2019, but no successful cases have been seen so far).

Let's analyze the three premises that were verified at that time:

① During the cycle, users’ attention and spending power are limited. When watching advertisements in a certain space, the exchange will be weakened in other spaces.

②Perfectly adopt the concept of economic cost. The cost of brand advertising depends on the performance bidding advertising, so the overall market revenue can be increased by adjusting the traffic strategy.

③The N+Reach concept proposed by the academic community, that is, within a window period (usually one month), the reach effect reaches its peak when users see 3 to 5 consecutive ads (not too few, not too many), and FB & Tiktok abroad have been running very well.

Brand advertising and performance bidding advertising are two completely independent systems that cannot be integrated. At this time, the R&F concept abroad triggered thinking, attempting to better integrate bidding and brand by switching advertisers' cognition (brand - buy exposure; bidding - buy conversion) to buying reach frequency, leaving more room for traffic strategy and being able to dynamically adjust the exposure time of each time.

On the surface, it looks like linking brand and bidding advertising resources and allocating them in a reasonable order to expose them to users.

In essence, it is about cutting the value of user attention from vertical to horizontal.

Unfortunately, I later spent a lot of effort trying the Reach&Frequency product, but it ultimately failed and my income was almost zero. Why? On the one hand, this is due to the fact that the awareness level of domestic customers has not yet been improved, and most people do not recognize advertisements that are highly uncertain and cannot guarantee quantity. On the other hand, the algorithm could not achieve the global optimal state at that time, and the ROI was too low.

Chapter 4: 2020-2022 - Splash screen ads are no longer strong

(1) Platform perspective version 3.0 formula

Revenue = SUM (user value x space x style x creativity x traffic strategy) revenue - SUM (user life time) loss

Supply and demand relationship: Customer budget shifts have intensified, supply >> demand has become apparent, and excess inventory cannot be sold.

Design focus: Excessive traffic, redundant inventory and waste, efforts should be made to prove value; an independent department should be established to control the advertising experience and monitor user losses.

① Style: Having tasted success in 2019, the company continued to make periodic efforts in innovative styles and launched a number of interactive styles with novel gameplay, but the gap was huge compared to Topview in 2019.

② Traffic strategy: The opening screen location strategy was changed from a fair distribution strategy to a preferential strategy. Giant companies also launched a "bidding" attempt, and information flow brand advertising was sold at a lower premium rate.

Extension and conclusion: From the perspective of commercial platforms, traffic strategy is the key to maximizing profits. Grasping the behavior of key groups is the core of traffic strategy adjustment. For example, if information flow advertising changes from hard-coded adloads (ad fill rate) to hard-coded ecpm, the overall benefit will be +2%. If the splash screen advertising experience is optimized, the overall benefit will be +0.5%. The reason behind this is that users have limited attention and the monetization efficiency of the splash screen unit is not high. If incentive advertising is proactive advertising with extremely high monetization efficiency, giving users choices in advance and sending more incentive ads can increase the overall benefit by 10%, with less decline in user experience.

Summary: The exchange ratio must exist, and a cost-effective exchange ratio conforms to the behavior of most users in a certain scenario.

③ Sales form: 20 years of CPT/GD are sold at the same time, and the bidding method of performance advertising can be tried. Starting from 21 years, we will abandon CPT and only sell GD advertisements.

(2) Advertisers’ perspective

Feeling that traffic is too expensive and "cheated", people are more cautious when purchasing brand advertising and shift their budgets to performance advertising.

①How to measure advertising effectiveness

Exposure (SHOW) and click-through rate (CTR) data; based on the users who are actually exposed to the campaign, provide customers with a user attribute analysis report on the hit users; some industry operation teams provide some joint brand-effect delivery solutions; combine the crowd asset solution to compare the differences before and after the campaign.

② User Value Drill-down Attempt 2: "ByteDance's O-5A Theory of Crowd Asset Measurement", "Ali's AIPL, DeepLINK Theory) etc.

The biggest drawback of brand advertising is that it is impossible to measure the impact on users well, that is, what did they buy with their money? ——Advertisers need to be given an answer.

In one sentence: Describe the value of advertising within a period through the changes in the AA population before and after the launch.

Taking ByteDance's O-5A group as an example, they directly use the 5A theory of Kotler, the father of modern marketing, in "Marketing 4.0" - awareness, appeal, inquiry, action and advocate.

③User Value Drill-down Attempt 3: "Efficiency Measurement & BLS (Brand Lift Study)"

In a nutshell: measure the true value of an advertising campaign through scientific A/B diversion experiments (Group A is exposed to ads, Group B should be exposed but is not)

It can be understood as the real Ground truth. There are two specific product forms. The first is CLS, which is used to measure advertising performance. The brand enhancement measurement is a measurement method that uses the "user cognitive difference" indicator as the core difference indicator. For different user cognitive indicators, 250 to 300 questionnaire surveys are conducted to help advertisers understand the advertising effect in multiple dimensions, thereby providing guidance and suggestions for the next launch. In theory, it is a very good way.

(3) "The Ultimate Way to Make Money with the Splash Screen Ads in APP Factories" - Chapter 4: Splash Screen Ads Are No Longer Strong (Original Fiction)

The story is always full of ups and downs, and in 2020 the epidemic hit.

The DAU of Douyin and Toutiao continues to set new highs. This is a year of change. For major advertisers, they have cut their offline advertising budgets and many brand advertising budgets. In order to "survive", they have pointed their spears directly at performance advertising.

Splash screen advertising, the king of 2019, unexpectedly suffered a setback.

The sales fill rate has fallen from nearly 90% to 60% and now to 40%.

It is worth mentioning that to make matters worse, in 2021, the Ministry of Industry and Information Technology of the People's Republic of China took strong measures to rectify the splash screen ads across the entire network, requiring that only one clearly visible button can jump, and no others can jump. This change directly reduced the click-through rate of splash screen ads by 80%.
…

"R&F, stop it. Let's see how to change. In this situation, we can try bidding ads on the opening screen and you can promote it."

"To add, the background is that the revenue from brand advertising, especially the splash screen, has dropped significantly in the past few bimonthly periods. In addition, the DAU is too high to sell out, so we are considering using bidding ads to fill the splash screen spots."

"In addition, we have to think of ways to convince advertisers and let them know that brand advertising is useful. This is also very important. There are several directions we can try. Recently, we have contacted some scholars and experts to study methodology. We must lead the Chinese market!" The man's voice was heard again in Toutiao's combat meeting room the next day.

…..

In 2022, splash screen ads will not be stopped, but if you find that the app will jump when you click on it randomly, you can report it to the Ministry of Industry and Information Technology for the benefit of the people.

Author: A Cheng demolishes the product

Source: Achengchai Products