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Technology and quick service companies lead growth in mobile performance advertising


By Laurie Fullerton | Freelance Writer

August 23, 2016 | 4 min read

Gaining coveted space on consumers' smartphones and tablets, Opera Mediaworks observes today in its quarterly mobile marketing report that companies in the technology/gadgets vertical have invested the most heavily in mobile direct response (DR) over the past year, capturing 24.3 per cent of ad dollars spent on performance campaigns.

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Among those campaigns, the most successful have been for apps that offer daily utility to the user, such as those that increase photo storage or track stocks while technology and quick service restaurants (QSR) captured the most annual spend, replacing retail and e-commerce for the top category. Additionally, retail and automotive have shown the most consistent growth since the third quarter of 2015.

Food delivery and quick service restaurants (QSR) was not far behind, with 23.4 per cent of annual ad spend, and it has been the strongest vertical for the first half of 2016. These brands present a unique challenge for performance teams because they are often looking to optimize multiple KPIs at once, the company said.

"These top QSR brands are looking to do much more than drive app installs at their targeted CPI rate. They're measuring post install engagements such as registrations and coupon downloads, with an ultimate goal of driving foot traffic to their brick-and-mortar locations," said Jude O'Connor, Opera's vice president of brand performance. "By tracking those post-install events, we've been able to create audience profiles of their common customers, optimize to those audience and others who match their patterns of behaviors, and play a large role in them redeeming coupons within store -- thus directly boosting the brand's sales and revenue."

Ad spend from travel brands has more than doubled from Q1 to Q2, due mostly to the summer travel season, but the company expects both travel and entertainment to grow tremendously, the latter as the United States heads into NFL season (fantasy sports apps) and fall television series (streaming media apps).

Time spent on the top 100 apps has also increased by nearly ten per cent with mobile users spending up to 33.5 minutes a day in the first quarter of 2016. Average session length also increased by 10.8 per cent and is now 9.4 minutes.

Additionally, news and information is now at the top for impression volume, with more than one in four ad impressions served via apps with daily utility to users, such as weather apps and a mobile reader for Reddit.

The report also found that the highest engagement levels are seen on ads run in the education and travel categories, with performance of 1.9 times and 1.7 times the average platform CTR. Games remain the top converter, followed by sports, but health and fitness and productivity have moved into the top five for the first time.

Further, the definition of a high-quality user is different for each industry, and each brand as well. While lifetime value (LTV) models for gaming are fairly simple, based on retention and in-app purchases, those for brands are more complicated, Opera found. Additionally, by tracking and optimizing to as many as 22 post-install events, such as registration/logins, social sharing, wish list add or initiated checkout, brands can calculate LTV and focus their spend on sources that deliver results.

"Targeting, tracking and optimizing is how you win in the world of performance, and that's why having a mobile-ad SDK is so important so that you can feed your algorithm with accurate data signals and feedback from campaigns," said Kevin Teng, senior director, performance advertising, opera mediaworks. "But the people who work with that data are also important. As demand for top-tier performance advertising grows, I believe we're going to see even more user acquisition and performance teams with incredible talent in analyzing KPIs and navigating complicated reporting and attribution structures."

There are significant pain points that brands have when designing ads for performance campaigns, including hesitation to loosen brand guidelines and lacking the kinds of assets and storyline that will convert users. In the report, Opera's creative team presents three best practices for mobile creative specifically built for performance campaigns.

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