56 Ad Monetization Terms You Must Know in 2020

According to a report from Aurora, the total online usage time of users' apps across the entire network increased rapidly after the holiday officially began on January 24, which was much higher than the same period last year and increased by nearly 26% compared to before New Year's Eve.

Although the "black swan" has arrived, the mobile Internet traffic market has ushered in its own "bull market". Some media have gained a large number of users, achieved explosive growth, and also gained new opportunities for monetization.

The epidemic is a disaster but also a mirror. If we want to develop, we must find certainty in uncertainty.

Part 1: Participants in APP advertising monetization

The completion of an advertising transaction requires the joint efforts of multiple participants/platforms, and only through mutual cooperation can the value of traffic be truly realized.

Supply Side

The party that sells advertisements is mainly the media/APP and ADN (advertising network).

Media/APP: The ultimate owner of traffic, providing a platform for advertisers to reach their audiences and serving as the terminal for cash flow direction. ADN (Advertising Network): can be understood as a media agency that earns the difference by purchasing media traffic for advertisers. Its representatives include Baidu Ad Network, etc.

Demand side

The party that places the advertisement. Mainly advertisers and advertising agencies.

In terms of docking types, direct docking between suppliers and advertisers is called the direct customer model, and docking with advertising agencies is called the agency model.

Audience

The party that receives the advertisement. Mainly media/APP users.

Service provider

The party that provides services for the entire monetization process. It mainly provides services such as traffic integration, advertising placement and management, advertising monitoring, and data management.

Service demand side: DSP (demand-side platform): also known as advertising delivery platform, provides advertising delivery functions for demand sides. Demand parties can manage advertising campaigns and their delivery strategies on the platform. TD (procurement and trading platform): Similar to DSP, but the demand side can manage the delivery of multiple DSP platforms on TD.
Service provider: SSP (Supply Side Platform): Serving the suppliers, it is a traffic management platform that aggregates multiple media traffic. Suppliers can manage and settle advertising revenue on the platform.
Service transaction process:
ADX (Advertising Exchange): The function provided is exchange, connecting demanders and suppliers, and achieving real-time bidding, matching of advertising inventory and advertising demand.
Other service providers: DMP (data management platform), PCP (programmatic creative platform), AVP (ad verification platform), etc. If you are interested, you can learn more about them independently.

In the early stages of APP monetization, the media must position themselves correctly and identify the participants in the transaction path. In addition, finding a guide who is proficient in the industry is also a good choice.

Part 2: Main ways to monetize APP advertising

As a supplier, media/APP has multiple ways to sell advertisements to obtain cash income, which are generally divided into two forms: self-sales and third-party sales.

Selling Scheduled Ads

The media expands advertisers and agents by relying on their own strength, and agrees on cooperation by placing orders via email. The settlement is generally based on time, and the advertising materials are manually operated by technical personnel.

Build your own advertising platform

In the programmatic era, media build their own DSPs, rely on their own strength to expand advertisers and agents, and sell advertising resources through the DSP platform.

Access to ad networks/third-party DSPs

That is, the media connects to major alliance resources (such as Pangolin, Youlianghui) or other third-party DSPs through standard technical documents (API or SDK), and uses external forces to sell its advertising resources.

Part 3: Main types of APP advertising monetization

The ads that audiences see on the APP are ads on the ad slots, which can be classified based on location and form:

Splash Ad.

Also known as startup page ads, they appear when the APP starts loading. The ad image or video is displayed for a fixed time (5 seconds). After the display is completed, it automatically closes and enters the APP main page.

Banner Ad.

The most common form is to embed a layout in a relatively fixed position on the APP page. Interstitial Ad. is a triggered ad. After the user makes a corresponding operation (such as start, pause, pass, jump, exit), a half-screen or full-screen ad in the form of a picture, animated image, video, etc. will pop up.

Roll Ad.

The advertising content will be pasted into the video. It can be divided into two forms: video patches and Band-Aids. The former is to add horizontal video ads of 5s-60s to three positions before, during or after the video is played. The latter puts elements such as pictures/animated images in the video being played.

Feeds Ad.

It is the most popular form of APP at present. It appears in APPs that produce content and is an advertising form that is integrated with the daily content of APP (such as a piece of information, dynamics, pictures, videos, etc.).

Search Ad.

It is also a triggered advertisement. After the user searches for keywords, advertisements will appear in the search associations and search results. They are usually the advertiser's APP/product, or content with promotional nature, presented in the form of information flow.

Incentive Ad.

It is to use incentives to make users accept advertisements or take specified actions, such as downloading APP, watching videos, etc. It can be divided into two forms: point wall and incentive video. In the former, users can complete designated operations to obtain points and redeem rewards. In the latter, users can complete designated operations to obtain rights and interests, such as game resurrection, new privileges, etc.

The APP ads purchased by the demand side are ads that meet their brand promotion or effect conversion needs, and can be classified based on the purpose of delivery:

Brand Awareness

Long-term advertising used to build brand image and brand concept without appealing to direct sales.

Direct Response Advertising

An ad that is run in the short term to increase product sales or awareness, and is therefore usually charged based on performance (downloads or sales, etc.).

Part 4: APP advertising monetization transaction model

Contract Advertising

A contract is used to determine that a certain advertising space will belong to a specific advertiser within a period of time, which is called scheduling advertising.

Bidding Advertising

Transactions conducted in the open market are generally called open trading markets, which have mature technical means and auction systems.

RTB (real time bidding)
Real-time bidding is a bidding technology that evaluates and bids for each user's display behavior.
Usually, advertising trading platforms will set a floor price for each ad space, and the demand side must bid higher than this floor price to be eligible to participate in the bidding.

Generalized first pice auction GFP
In a broad sense, the first price is the price at which many buyers bid. The highest bidder wins. The successful bidder needs to pay the price he or she has offered.

Generalized second price auction GSP
The most common bidding method is the second price in a broad sense, in which many buyers bid and the highest bidder wins. The successful bidder needs to pay the bid made by the second highest bidder plus a minimum unit.

Transactions conducted in private trading markets are generally called private marketplaces, including: PDB, PD, and PA.

PDB (private direct buy)
Private direct purchase means that the advertiser finds the media to determine the advertising location and price, and then places the advertisement according to the scheduled time, but the transaction method is still programmatic.

PD（preferred deal）
Priority trading. A relatively high-quality ad space sold on a CPM basis may have remaining impressions after the PDB transaction. Both parties will sell it at a fixed price without agreeing on the sales volume.

PA (private auction)
Private auctions. The media specifically selects the advertising spaces that are more popular with advertisers and sells them in a semi-open market for powerful advertisers to bid on, and the highest bidder wins.

Part 5: APP advertising monetization settlement indicators

CPM

Cost Per Mille (Cost per thousand impressions), abbreviated as CPM.

It is pay-per-view advertising, that is, the advertiser pays the fee every time the advertisement is displayed (exposed) one thousand times.

CPC

Cost Per Click (CPC for short).

It is pay-per-click advertising, which means that charges are based on the number of times the ad is clicked.

CPA

Cost Per Action (Cost Per Action), referred to as CPA.

It is an advertisement that is charged based on user behavior. The behavior can be registration, downloading, installation, adding to shopping cart, placing an order, consulting, etc. It can be broken down as follows:

• CPD (Cost Per Download: charged by APP download volume)
• CPI (Cost Per Install: charged by the number of APP installations)
• CPS (Cost Per Sale: charged based on actual sales volume)
• CPL (Cost Per Lead): Charges are based on the number of potential customer lists/sales leads collected.

Part 6: APP advertising monetization data indicators

The supply side is most concerned about advertising revenue indicators.

Ad fill rate

Ad fill rate refers to the ratio of the number of ad impressions (or ad exposures) to the number of ad display opportunities (or ad requests) within a period of time. The formula is: Ad fill rate = number of ad impressions / number of ad impression opportunities * 100%

eCPM

Effective CPM, expected revenue per thousand impressions. CPM is the estimated value before delivery, and eCPM is the actual statistical value after delivery. According to the natural division of the conversion process, eCPM can be decomposed into the product of click-through rate and click value. eCPM=(ad revenue on the day/total number of ad impressions)*1000.

What the demand side cares most about is the advertising effectiveness indicators.

Impression

It means "exposure" and measures the number of times an ad is shown. It counts how many times an ad is shown.

Click

Click refers to the number of times an Internet user clicks on an advertisement. ROI is the abbreviation of Return On Investment, which refers to the ratio of the value recovered by advertisers through advertising to the advertising investment within a specific period.

Click-through rate and cost per click

That is, CTR (Click Through Rate), which is the ratio of ad clicks to ad impressions and the average cost per click.

Conversion rate and conversion cost

That is, CVR (Conversion Rate), the ratio of conversions to arrivals and the average cost per conversion.

Payment rate and payment cost

The ratio of the number of paying users to the number of registered users imported by advertising and the average cost per paying user in a specific period

Part 7: APP advertising monetization targeting technology terms

Precise delivery and accurate identification of users are the primary conditions. In addition, media outlets also need to better understand users as a support for targeted delivery.

Device ID

Refers to the unique identification code of the user's mobile hardware device. Device ID is the general term for the unique identification code of this type of device. The device ID on Android is generally Android ID or UDID, and the device ID on Apple phones is IDFA. On the PC side, advertisers use cookies to track audiences, and on the mobile side, they use device IDs.

• IMEI: International Mobile Equipment Identity, the abbreviation of International Mobile Equipment Identity Code. It is an "electronic serial number" consisting of 15 digits and is generally used by Android phones.
• IDFA: Identifier For Advertising, an advertising identifier unique to iOS.
• OAID: Non-persistent device identifier. The OAID field is a device identification field jointly launched by the China Academy of Information and Communications Technology and manufacturers such as Huawei, Xiaomi, OPPO, and VIVO. Advertising channel operators can choose OAID as an alternative field to IMEI.

Basic Orientation

Provide targeting options when delivering ads based on user age, gender, behavior, interests, and other labels.

Position Orientation

Provide targeting options when delivering ads based on the user's geographic location (generally broken down into provinces and cities).

Redirect

Identify the user groups that have a clear interest in the ads placed by the advertiser (have clicked, interacted, etc.) and place the ads again.

Part 8: APP advertising monetization docking process terms

SaaS (Software as a service)

Software as a Service is a set of customizable platform software. There are corresponding SaaS products in almost every industry.

Joint debugging test

Joint debugging testing is to assemble the tested subsystems into a complete system for testing. It is an effective way to verify whether the system can indeed provide the functions specified in the system solution specification.

Cold Start

The commercialization cycle of an app is usually defined as the following periods: cold start, growth, maturity, and decline. Cold start refers to the period from project initiation to project launch, until the period before rapid growth.

Author: AdBright

Source: AdBright