Growth strategy for advertising monetization: splash screen ads

When I was searching for relevant information on advertising monetization strategies, I found that most of the information was sharing content about advertising placement, advertising bidding, and advertising content optimization. There is very little sharing on actual strategies or data growth methods for how to increase advertising revenue for small and medium-sized traffic products. This article will share some practical methodologies to address this issue.

In the Internet industry, the vast majority of C-end products will more or less involve advertising monetization business after accumulating a certain amount of user traffic. Those who understand advertising monetization actually know that the advertising bidding and trading system based on advertiser placement and traffic display only exists in its entirety in some of the leading companies. For most small and medium-sized traffic products with daily active users ranging from hundreds of thousands to a few million, there are very few complete advertising bidding systems built independently. The advertising monetization business of such products mostly does not directly take over the advertising resources of brand advertisers, but relies on advertising alliance platforms to assist in completion.

Advertising Alliance

As a media platform between advertisers and traffic owners, the advertising alliance meets the different fields and delivery needs of advertisers and provides them with more accurate delivery options to reach users. At the same time, it integrates a large number of mid- and long-tail traffic owners such as websites, APP products, and self-media to create revenue sources for them based on their own positioning and needs. At present, the digital advertising alliances with greater influence in my country's mobile Internet advertising market mainly include: Toutiao Pangolin Platform, Tencent Youlianghui, Baidu Alliance, Taobao Alliance, etc.

1. Advertising Type

Advertising alliances provide advertising resources for traffic owners through the following types of advertising positions.

1. Splash Ads

Splash screen ads are ads that appear on the startup page when a user first enters an app. The fixed display duration of the ad is generally 3 to 5 seconds. It not only brings profits to the product, but also enriches the content during the short loading waiting time when the APP starts, without disturbing the users, so users are more likely to accept it.

2. Feeds Ads

Information flow advertising is an advertising form that is interspersed in the APP content flow and is highly integrated with the content format. Information flow advertising can be in the form of pictures, graphics, text, videos, etc. Information flow advertising provides a relatively good experience for users, and advertisers can use user tags to accurately deliver ads to traffic platforms.

3. Rewarded Video Ads

Incentive video ads are ads where users choose to watch full-screen video ads in exchange for rewards within an app or game. Incentive video ads are currently one of the most popular advertising formats among three parties. For users, incentive videos have rich and interesting advertising content. You can get certain rewards by watching videos. For advertisers, incentivized videos can be accurately delivered to reach users and achieve high conversion rates. For traffic owners, incentivized videos can not only meet user experience requirements but also provide high conversion rates, thus ensuring good advertising returns.

4. Banner Ads

Banner ads are placed at the top or bottom of the APP page. Banner advertising is the earliest form of online advertising and is currently one of the most common forms. It can display advertising content very intuitively and quickly attract users' attention. However, it is easy to cause certain obstruction to content viewing, affecting the user experience.

5. Interstitial Ads

Interstitial ads usually pop up when a user clicks on a function page for the first time, displaying the advertising content. This form of advertising can bring a very strong visual impact to users and has significant effects. However, this will also interrupt the user's normal product usage and affect the user experience.

The editor will introduce the monetization strategies of the above different advertising types in traffic products through three to four articles. The subsequent content of this article will revolve around the monetization strategy of splash screen ads .

2. Splash screen advertising strategy

As a traffic platform, while considering business monetization, we must also always think about how to ensure the balance of user experience, so as not to reduce user experience due to advertising monetization of user traffic, resulting in a cliff-like drop in traffic. Therefore, when doing advertising monetization, the editor will think and design advertising strategies from two dimensions: business monetization and user experience .

1. Business monetization of splash screen ads

Let’s first talk about the dimension of business monetization. Here, we can ask ourselves two questions:

• Data issue : Is the product advertising data you see real and accurate? For example, what are the advertising pull rate, advertising fill rate, advertising exposure rate, etc.
• Display issue : How to display splash screen ads to achieve the highest revenue?

The editor will give detailed answers to the above two questions through several hypothetical cases.

1.1. Splash screen ads: data issues

Some readers may wonder about the above data question: " Are the product advertising data you see real and accurate data? " Those who have been in charge of advertising products know that the advertising revenue data reports provided by Pangolin, Youlianghui or other advertising alliances mostly calculate advertising revenue based on the statistical value of the display volume. The quality of the advertising monetization business of most traffic products is evaluated through the daily ARPU value of the advertising business. The simple calculation formula for ARPU of advertising business is:

The total daily revenue of advertising in the ARPU formula can be directly obtained from the data dashboard of the advertising alliance, so how do we determine the total number of users covered by the advertising business? Some readers here may think, " Isn't the total number of users covered by the advertising business the daily active number or monthly active number? " Is this really the case? Let’s think about this through a simple case:

Case: The splash screen advertising strategy of an e-commerce product is to display a splash screen ad when the screen is first opened every day, and it is only displayed once. The splash screen ad will not be displayed when the user first opens the screen after installation or upgrade. Daily active users are defined as users who have visited the app once on the same day. Assume that the product has 10,000 daily active users, of which 2,000 are users who install the APP on the same day and 1,000 are users who upgrade the APP. The fill rate of splash screen ads is 80% and the ad exposure rate is 90%. The total revenue from the splash screen advertisement on that day was 1,000 yuan. So at this time, what is the daily ARPU value of the product’s splash screen ad?

In the above case, although there are 10,000 daily active users, only 7,000 users are actually covered by the splash screen ads, and the number of users who actually see the splash screen ads is only 7,000 × 80% × 90%, or 5,040 people. As can be seen from the figure, when the user group I choose is biased, it will seriously affect the final result of the measurement standard. The virtual case I gave is a very simple combination of conditions. In actual work, especially for small and medium-sized products, due to the subtle differences in advertising strategies, version updates and compatibility, user habits, logical loopholes in embedding points and many other factors, we are unaware of the obvious deviations in our final evaluation of advertising monetization effects. For example ,

• Xiao Wang made a macro judgment based on the daily active users and new users that the pull rate of splash screen ads is 90%. On this basis, Xiao Wang continuously optimized the fill rate of splash screen ads as well as the advertising frequency control and user experience risk control strategies. But the final effect was not good and the ARPU value did not increase.
• After Xiao Zhang used data tracking to clean and deduplicate daily active users for the splash screen advertising scenario, he found that the user pull rate for splash screen advertising was only 60%. Xiao Zhang discovered through data analysis that the low pull rate was caused by version incompatibility, program bugs in display logic, and other reasons. After increasing the user acquisition rate to 90%, the ARPU value of the splash screen ads has also increased significantly.

Through the explanation of the above cases, readers and friends understand the meaning of the editor’s initial question: “Are the product advertising data you see real and accurate data?”

1.2. Splash screen ads: display issues

After we briefly talk about the data issue, let’s talk about the display of splash screen ads. Since the definition of a splash screen ad is to display an ad when the app is launched, in theory, there is an opportunity for a splash screen ad to be displayed every time a user launches the app. So how can we display ads better? If you focus on business monetization, you definitely want to display a splash screen ad every time the user launches the APP, regardless of whether it is a cold start or a hot start. This strategy will definitely have the strongest monetization capability.

Cold start : When an application is started, there is no process of the application in the background. At this time, the system will recreate a new process and assign it to the application. This startup method is called cold start. Hot start : When an application is already open, but the back key, home key, etc. are pressed to return to the desktop or other programs.

However, since most APP products pay great attention to user experience, the crude strategy of displaying splash screen ads every time the screen starts is obviously not feasible. PM should consider the balance of user experience when formulating the display strategy for splash screen ads. This brings us to the following topic.

2. User experience of splash screen ads

The so-called user experience strategy is actually the experience risk control strategy of advertising display. When we pursue the ultimate in business monetization, we use experience risk control to balance the adverse effects of advertising on users, continuously optimize, and achieve a balance between business monetization and user experience. Some readers may think:

• As small and medium-sized traffic products, when we access the advertising resources of advertising alliances, we cannot control and adjust the quality of advertising content. So how can we balance the user experience?

The editor also gives two directions for thinking here: product positioning and user analysis .

2.1. Splash screen ads: product positioning

First, let’s talk about product positioning. The splash screen advertising display strategies for different types of products are different.

• In efficiency products such as calendars, weather, and air and hotel reservations, users use these products at low frequency and low stickiness because they need to solve clear needs. Once their goals are achieved, they will not visit the products for a long time. This type of product needs to maximize its commercial value in the few screen launch opportunities. Therefore, in most cases, a splash screen ad will be displayed during each cold start.
• In time-based products such as social networking, content communities, and information, since users use the products frequently and have high stickiness, the purpose of users using the products is to consume time. The core value of this type of product is to ensure user stickiness and activity. Advertising monetization will not become a means of monetizing its core business. Therefore, in most cases, no splash screen ads will be displayed when the screen is turned on.
• In transaction-based products such as e-commerce and finance, although users use them frequently, their stickiness is not strong. After their own transaction needs are met, users will not continue to use the products with high stickiness like time-based products. For transaction products, the core value is the ability to monetize. Splash screen ads can provide strong decision-making guidance for its monetization business. Therefore, when the screen is turned on, the splash screen ads will be displayed in a controlled manner according to business needs.

After we determine the product positioning and business characteristics, we can make better decisions on how to formulate the strategic direction of splash screen advertising.

2.2. Splash screen ads: user analysis

Once we have determined the macro direction of the strategy, we need to determine the micro details of the strategy based on user data analysis. In the case of splash screen ads, we need to analyze user data such as the average daily usage time of users, the average daily usage frequency, the daily single usage time distribution, the daily user access time distribution, etc. Why do we need to analyze this data? Let’s take a look at this through a hypothetical case.

Case: Suppose you are responsible for the design of the splash screen advertising strategy for a composite product that combines tools, content, and e-commerce. How should you conceive and design at this time? Because it is positioned as a complex product and has a business demand for splash screen advertising. Then according to the product positioning in the first step, the macro direction of the strategy design is to display the splash screen advertisement when the APP is launched. In the second step, the micro direction of the strategy design - user analysis, you need to determine the following issues:

• On which number of screen startups each day should ads be shown? What are the rules between two splash ads?
• How many times a day are splash ads displayed?
• How long does it take for an ad to be displayed from the start of the screen to the splash screen?
• Do the above questions need to distinguish between cold start and hot start? Do you want to differentiate between iOS and Android?

Question 1: On which number of screen startups each day should ads be displayed? What are the rules between two splash ads?

As we all know, the first screen launch of the day has the greatest impact on users. Because the user's network loading efficiency must be considered, the user must wait for the ad request to succeed before it can be displayed. The request timeout for the alliance's splash screen ads is generally set at 3 to 5 seconds. The fill rate is affected by the timeout and is generally between 70% and 90%. If ads are shown when users first open the screen every day, it will take at least 3 seconds for users to click on the APP and enter the APP landing page (1 second to load APP configuration data + 1 second to wait for ad request results + 1 second for ad display and user clicks to skip). The display time of an advertisement within 3 seconds may be less than 1 second. The user experience here is very unfriendly. At the same time, we have to consider two special cases :

Case 1: Whether to distinguish between cold start and hot start when the screen is turned on for the first time. Due to the system characteristics of the Android side, when the user exits the APP to the system background, the APP is likely to be killed by the mobile phone due to system memory problems. Although iOS also has a memory protection mechanism, it is rarely triggered. Therefore, the first launch of the iOS APP on the same day may be a hot start. A normal hot start to the APP landing page may only take 1 second, but due to the ad pull loading, this time period becomes longer, at least 2 seconds longer.

Case 2: The user's use of the APP product happens to span two natural days, that is, from 23:59 yesterday to 00:01 today. Suppose the user launched the app for the first time at 23:59 yesterday and saw the splash screen ad, and used the app at 00:01. At this time, he received a WeChat message. The user put the app into the background and spent 1 minute replying to the WeChat message. When you enter the APP product again at this time, for the APP system, this hot start is the first screen startup of the day. At this time, if it takes 2-3 seconds to show the splash screen ad to the user, will the user's mentality explode instantly?

Based on the above case thinking and analysis, the splash screen advertising display strategy of this composite product is optimized as follows:

• No ads are shown on the first cold start of the day. In most cases, splash screen ads are shown on the second or third cold start.
• Without distinguishing between cold start and hot start, the display duration of two adjacent splash screen ads must not be less than 30 minutes.

Question 2: How many times a day are splash ads displayed?

The daily display limit of the splash screen ads on general affiliate advertising platforms is 10 times per IP address. If the number of times exceeds 10, any subsequent request to pull the splash screen ad will result in a failure. After thinking through the above issues, this issue can be maximized as much as possible while ensuring user experience. Most traffic products do not only undertake one advertising alliance platform, so it is unlikely that a large number of users will fail to return after the number of times the splash screen ad is displayed reaches the upper limit.

Question 3: How long does it take for the ad to be displayed from the start of the screen to the end of the screen?

This question is actually a more technical one. As mentioned earlier, the request timeout for the alliance's splash screen ads is generally set at 3 to 5 seconds. The fill rate is affected by the timeout and is generally between 70% and 90%. If an APP product does not load a splash screen ad, it generally takes 1 second for iOS to launch the APP and enter the landing page, while it usually takes 1-3 seconds for Android due to differences in mobile phone performance. If a splash screen ad is added, it will take 3 to 9 seconds to enter the landing page within the APP. Therefore, in order to ensure user experience. Generally, the recommended duration of 3 to 3.5 seconds is used according to the advertising alliance. Although it will reduce the ad fill rate, it can balance the impact of splash screen ads on users' bad experience to the greatest extent.

That’s all for my sharing on the monetization strategy for splash screen ads.

Author: Yang Sanji

Source: Yang Sanji (zyjn2020)