Study: Digital and physical retailers approach in-app ads differently

Retailers are major users of in-app advertising, but preferences for features like banner ad size vary by channel.

According to the “Retailer’s Guide to In-App Advertising” from global in-app advertising provider Smaato, retailers accounted for 49% of in-app advertising spend on its platform in the second half of 2018. This significantly outpaced all other verticals, with media coming in second at 23%.

However, brick-and-mortar and online retailers do not leverage in-app advertising in the same way. Smaato analysis shows that brick-and-mortar retailers are 71% more likely than e-commerce retailers to spend on outstream video ads that automatically play on a large-format player when a user navigates to it inside text content.

Brick-and-mortar retailers are also 31% more likely than their online counterparts to spend on interstitial video ads that cover the full screen of an app. In contrast, e-commerce retailers are 37% more likely than physical retailers to spend on rewarded video ads – full-screen ads that users view in exchange for an in-app reward, such as points or virtual goods. E-commerce retailers are also twice as likely as brick-and-mortar retailers to 320x480 medium rectangle banner ads, while brick-and-mortar retailers are 31% more likely to purchase 320x50 banner ads.

Smaato analysts offered a few pieces of general advice for retailers’ mobile advertising strategies:

• Outstream video is the most popular format on the Smaato platform and offers high click-through rates and conversion rates for brick-and-mortar and online purchases.

• Banner ads are versatile, easy to create and effective despite being “old fashioned,” and cost less than other mobile ad formats.

• Rewarded video has a high conversion rate.

• Smaller mobile display ads have less impact on customers.