Incipia blog

Apple Unveils App Store Search Ads – App Marketers Rejoice

Gabe Kwakyi | June 9, 2016

Feature image credit to Apple: Search Ads - App Store - Apple Developer

Welcome to the Future of iOS App Marketing

On  June 8th Apple announced a series of changes aimed at boosting Apple's position as the reigning (and originator) App Store platform, with the adjustments hailed by the Verge as the "App Store 2.0." Among the changes, which include better revenue-sharing terms on subscriptions for developers was also the official announcement of the much-awaited App Store Search Ads product. Search Ads are Apple's answer to the massive demand for app install-based marketing campaigns, which up until now were largely dominated by Facebook's app advertising and monetization ecosystem.

Previously, Google led the charge into adding ads to store listings for Android apps with a similar endeavor in 2015, releasing Universal Ads in Play Store search results to much fanfare. While some app marketers are able to find cheap installs via Universal ads (sometimes on-par with incentivized campaign CPIs), Google's play store ads landed with mixed reviews given their lack of targeting (country-only), lack of creative optimization (Google allows a video or four 25-character "ad text idea" slots) and a lack of bidding abilities (unlike Google's other products, Universal ads only allow a target CPA; which, granted is better than CPC-based).

This lack of flexibility in managing myriad elements of a digital marketing campaign was a big departure from Google Adwords (as well as the reigning champ, Facebook), leaving many app marketers wanting more.

google universal play store ads

Image credit to Adweek: Google Calls Its New Ad Option for App Developers 'an Install-Seeking Machine'

Enter Apple's App Store Search Ads, arriving on the heels of Apple's failure to generate a solid company revenue stream through its recently shuttered iAd platform. Whereas Google's version of store ads follow a "black box" approach by giving mobile app marketing managers little control, Apple's Search Ads look to provide app marketing managers with more targeting, bidding, and other levers enjoyed on platforms like Facebook Ads.

Running beta in Summer 2016 and launching in Fall 2016, Apple's App Store Search Ads will be a game changer for Apple(offsetting declining product sales with rising app store revenue) and app developers/marketers(giving them a good opportunity to earn a good ROI from their app investments) alike.

App Store Search Ads Features

  • Only one ad will be shown per search - the winning ad will be selected as the top-ranked ad among all eligible ads, with rank based on a combination of factors including ad relevance score and bid
  • Users who have an app installed by default will not be eligible to see ads, preventing redundant advertising
  • Ads will be marked with blue shading and a blue "Ad" marker, similar to Google's yellow "Ad" marker
  • Advertisers can either create a custom ad, or promote their listing directly as an ad or let Apple automatically build an ad
  • CPC-based pricing with second-price auction mechanics and an optional CPA-optimizer
  • No minimum budgets
  • Other, similar elements of other digital marketing campaigns, including:
    • A relevance-score that will enforce relevance filtration first before an ad is entered into the auction and likely again as a pricing factor, similar to the Quality/Relevance Score seen in Adwords & Facebook Ads
    • Budget set at campaign-level, with targeting enabled at ad group level
    • A mix of targeting opportunities, from auto placement, to match-type based keywords, to device and audience (e.g. demographic data) targeting
    • Search term reporting
    • Dimensions optimization, such as geographic, time of day/day of week and device
    • Ability to create an ad presented in several formats and built from a combination of text and images
    • Targeting new users or re-engaging existing users and - even users of other apps in your developer account in a house ads-type approach
    • APIs for advanced campaign creation, management & reporting

App Store Search Ads summary

Image credit to Apple:Search Ads - App Store - Apple Developer

Key takeaways

  1. App Store Search Ads will be the single best method of driving paid app downloads 
    1. Apple's research touts that "over 65% of downloads come directly from searches on the App Store," making this channel of paramount importance for app marketers (though one caveat is that a sizable percentage of those searches are branded searches). Combine that with the concept in marketing that signals closer to a point of conversion produce a higher conversion rate and you quickly realize that App Store Search Ads will be the single best way to market iOS apps. By showing ads to people when they are in the act of searching in-store and cutting out one step in the current app marketing flow (simply tapping "get/buy" vs clicking to the store from an external source and THEN clicking get/install),  Search Ads represent the highest potential converting channel.
  2. Finally - figure out which app store keywords drove installs
    1. By adding "just a few lines of code to your app," you can see the data that has up until now eluded the fingertips of app marketers: which (app store-searched) keywords actually drove installs.
  3. ASO is more important now than ever before
    1. Another marketing concept is that the step in the conversion funnel that is most important with regard to improving ROI is the step just before the conversion (install) occurs, making the app listing itself the highest ROI funnel component to optimize (well - technically by this logic you could argue that somewhere in the app itself would be the highest ROI optimizable funnel step from a retention/ARPU perspective). While this has been true before, now that a preview of your app listing is now eligible to actually be an ad, optimizing your app listing has become even more important. Also, because search ads will have to answer to a relevance score, having a top notch app listing will have a direct impact on the top (tap) and bottom (conversion) of the app marketing funnel CRO strategy.
  4. App Store Search Ads combine keyword intent with massive scale
    1. While networks may boost millions to billions of users/impressions, Apple can make those boasts, too. Despite the promises of ad technology vendors of leveraging billions of device IDs, demographic/interest data and user behavior, keywords are still one of the best targeting methods when it comes to determining a person's intent. Marrying the massive scale of the App Store with the high intent of keyword targeting will produce a powerful combination indeed.
  5. Apple will finally provide access to its treasure trove of keyword data for research purposes
    1. Apple offers that app marketing managers will be able to "choose your own keywords from lists of relevant keywords that we suggest based on your app and its genre." Will we see a Google keyword planner-type tool, where app marketers can obtain keyword data with monthly volume, cost and other data provided for keywords, along with different filter types (e.g. app genre, country or pricing) and more powerful keyword research (currently most research is done from auto fill or related keyword searches)?
App store search ads keyword data

Image credit to Apple:Search Ads - App Store - Apple Developer

Questions for the future

  • Will Google revamp its Universal ad type, or expand app install ads into the Play Store to better compete? How large a bite will Apple's Search Ads take out of competing digital marketing platforms' revenue such as Facebook, Twitter or the masses of ad networks?
    • While these platforms do offer mobile app marketers access to people outside of the App Store and may not be in existential danger, a home run by Apple as the 1st party iOS marketing-and-distribution platform will certainly cause re-allocation of marketing dollars, and as Schiller and Apple improve app discoverability, more users will move directly to the App Store to find their apps, causing more dollars to shift.
  • How many kinks will Apple need to iron out of things like its Search Ads relevance score, and how painful will campaigns be to manage at first?
    • While the company builds amazing physical products, Apple has sustained criticism for some of its software implementations such as the App Store itself and iTunes connect which begs the question: how will the App Store Search Ad management experience feel out of the gate?
  • Will Apple also tell us what organic keywords drive searches, installs and revenue?
  • What sort of tie-in between App Store Search Ads and Apple's under-utilized spotlight search app indexing technology will we see unfold?
    • Distributing ads to spotlight searches is an easy next step, but will we see further integration between the two app discovery systems? 
    • When will Apple succeed and move the needle in improving app discovery?
  • Does this spell bad news for ASO tools?
    • As Apple and Google offer more and more access to their datasets, will ASO tools lose their appeal? While some data points such as download estimates may never come straight from the stores, ASO tools offer services that are already being provided by the App/Play stores such as A/B testing from Google Play and now keyword data from Apple. Will ranking data be next?
  • As always - what does the next App Store algorithm update have in store for us?
    • We know Apple has been tinkering with its next algorithm update after dropping an embarrassing ranking gaffe  - have new changes to the algorithm been built in parallel with upcoming technology behind search ads and its relevance score?
That's all for now folks! Thanks for reading - stay tuned to the Incipia blog or subscribe to our email list for more information on app store optimization and marketing strategies.

Incipia is a mobile app development and marketing agency that builds and markets apps for companies with a development speciality in high quality code architecture and keyword-based marketing optimizations. For blog/video or speaking requests, business or press inquiries please contact us at hello@incipia.co.