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Welcome to Mobile Monetization Hell!

Understanding true yield is really, really hard. Do you know how well your mobile ads are actually performing?

Pinpointing actual yield for mobile advertising is a lot more than just looking at CPM and revenue. There are nearly a dozen factors that go into making money from mobile ads. How well do you understand true yield?

This essay takes you through the many factors I've identified which drive overall performance.

NOTE: This article assumes DAU = Unique Users per Day

1. Impression Requests — The number of times your ad unit made a request to receive an ad from a network
2. Returned Requests — The number of ads that were actually returned by an ad network (often called fill and widely misunderstood)
3. Displayed Impressions — The number of ads that are returned from an ad network and actually displayed
4. Credited Impressions — The number of displayed impressions that you actually get paid for
5. CPM — Cost Per Thousand (this should be called revenue per thousand or RPM); the revenue you make per 1000 credited impressions
6. eCPM — Effective Cost Per Thousand (Effective Revenue Per Thousand eRPM); the average revenue you make per 1000 credited impressions. This factors various types of ad models such as CPI (cost per install), CPC (cost per click), etc. Giving you the blended average.
7. CTR — Click Through Rate
8. Impressions per DAU — The number of impression requests per unique user (Daily Active User); this is important because it represents your absolute total potential advertising inventory
9. Revenue per DAU — The actual amount of money you are making per DAU; you should look at this on a monthly bases (ex. 1 unique daily user generates $1.50 per month); also called True Yield per DAU
10. Revenue — The actual amount of money you make per day or per month from ads.
11. Leakage — The number and percent of impressions that you are not making money from
12. Revenue Potential — The amount of money you could be making without increasing your user base or engagement

That’s a lot of metrics. I submit most app developers barely know 1 or 2 of these. In order to know them all, you must use a combination of tracking and reporting tactics.

There is a good chance you aren't even tracking Impression Requests. This must be done in an analytics platform like Localytics or Mixpanel — the ad networks won't give it to you. It’s a critical first step because without it you won't know 3 critical things:

1. Your maximum potential revenue
2. Your total leakage (e.g. impressions that you didn't get paid for and revenue lost)
3. Your true yield (e.g. the true eCPM and true fill rate)

First, answer these questions to the best of your ability. If you don't know or do not track any of the following, then move on and just know you've got some things to think about

About Your App

1. How many ad units do you have in your app. This refers to the unique spots within your user interface that you show an ad. This could be a banner, interstitial, native ad, etc.
2. How many ad networks do you attempt to fill each ad unit from?
3. What is the DAU?

About Each Ad Unit (repeat these questions for each ad unit)

1. How many total impression requests does the ad unit generate per day?
2. What percentage of total impression requests are returned by your ad networks per day (sum the total returned from all networks for that ad unit)?
3. What percentage of returned ads are actually displayed to your users?
4. What percentage of those displayed ads are credited to you for revenue?
5. What is the eCPM across all ad networks (calculate the average from all networks weighted by the number of credited impressions)?
6. What is your total revenue per month generated by the ad unit (sum the total revenue from all ad networks for the ad unit)?

If you compile all the data from the above questions you can start to form a picture of performance, here is what you’ll know.

1. True eCPM — The actual revenue you are making per thousand impression requests, not just what you got paid for.
2. Impression Leakage — The number and percent of impressions you are not getting paid for
3. Lost Revenue — The amount of revenue you are missing out on

Now, Head on Down The Yellow Brick Road to Mobile Monetization Utopia.

Visualizing the current situation is the first step — now it’s about improving yield. This is what really revs my engine. When I see a broken system, I just have to try and fix it. So that’s what we've done, first for ourselves, and now for other app developers. Here’s how we can help.

1. Increasing the Fill — Learn how to increase the % of impression requests that you actually get paid for
2. Increasing Impressions — Learn how to increase the total # of impression requests you make, thus increasing your overall yield potential
3. Increasing your eCPM — Learn how to improve CPM/RPM rates which will make you more money
4. Knowing and Understanding the Data — Learn best practices about implementing critical data tracking and analysis processes

If you like this essay, please consider recommending it by clicking the little heart at the bottom. And please follow me to get notified when I post something new. To learn more about how my company Affinity Networks is helping apps maximize advertising revenue, please visit http://afty.co.