Retargeting is ‘where the puck is going’ in mobile advertising

SAN FRANCISCO — Mobile marketers are spending a lot more time these days thinking about retargeting mobile users with mobile ads. The goal is to get people who have already downloaded their app to come back and use it regularly.

Traditionally, mobile marketers (like app developers) have spent the majority of their ad spend on simply acquiring new customers to install their app. But that’s increasingly expensive.

The cost rose 34 percent from a year ago according to data collected by mobile-marketing firm Fiksu. The cost-per-loyal-user index increased 21 percent to $2.25 in September, from $1.86 in August.

So a growing portion of mobile marketers’ ad spend is going to retargeting existing customers by showing them relevant ads in other mobile apps or sites, like Facebook, for example.

AppLovin CTO John Krystynak said here at the Mobile First conference that if an advertiser spends $15 on customer acquisition advertising, they could hit existing customers with retargeted ads 30 or 40 times.

Marc Hale of TapCommerce (now owned by Twitter) says some of his company’s clients have now turned their ad strategies on their heads, spending 80 percent of their ad budget on mobile retargeting and 20 percent on new customer acquisition.

“Retargeting and re-engagement is probably the most exciting thing going on in mobile advertising today,” said Micah Gantman of Tune, an enterprise SaaS company for mobile marketers.

Hale said his company has been focusing on it because they “want to go where the puck is headed.”

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Several of the panelists here called out the gaming industry as being the first movers in retargeting gamers on mobile devices. “The majority of the money being spent on mobile retargeting is coming from the mobile gaming community,” Hale said.

“Gaming companies are ‘mobile first’ and they know the lifetime spend of their customers, and they can see the whole customer sales funnel. They have it right in front of them,” Krystynak said.

In the app world the “sales funnel” means all the steps the customer takes from learning about and downloading an app to making purchases within the app.

“They’re retargeting gamers to get them back to buy coins and Smurfberries in the app,” Krystynak said.

Gaming companies have learned some important lessons about how to re-engage users. “Mobile gaming companies often retarget people who have recently installed the game so that they can keep them coming back,” TapCommerce’s Hale said.

Many beer brands and lifestyle marketers use Foursquare to retarget customers, the company’s Rob Wilk said. That’s because users like to use the FourSquare mobile app to check in at a drinking establishments and talk about booze and other lifestyle products.

One source said here that retargeting is now the social check-in site’s biggest source of revenue.

Another thing the panelists agreed on is the importance of data. “We have 17 events that can be looped back to the marketer for optimization,” said Tune’s Gantman. Here, “events” are what the targeted customer experiences while moving toward a purchase, such as what types of retargeting ads customers clicked on, or how many times they completed a tutorial in an app.