Mobile marketing terminology can sometimes seem like an alphabet soup of acronyms and formulas.
To help ensure that you’re savvy about your own ad campaigns, here’s a list of 10 key terms that you should know when marketing your mobile game, as compiled by Unity experts. Use it to expand your knowledge of the lingo, or bookmark it to save as a resource to keep handy when you need a quick reference.
The acronym for average revenue per daily active user, ARPDAU, is a metric used to measure the success of a monetization campaign. It measures how much revenue active users generate for an app or game every day. ARPDAU is calculated by dividing daily revenue by daily active users (DAU).
Because ARPDAU is an average, fluctuations in your DAU won’t affect it, giving you a clear metric of daily app monetization performance.
Cost per mille (CPM) is the amount advertisers pay to publishers for every 1,000 ad impressions. It is also known as cost per thousand (“mille” means 1,000 in Latin). This metric helps developers and publishers keep track of the amount of resources they should allocate to their portfolio in order to keep it net-positive.
One common way to determine the efficiency of a CPM campaign is to look at click-through rates, or the ratio of clicks an ad receives compared to overall impressions.
To measure CPM, simply divide the total cost of the campaign by the number of impressions. The result is then multiplied by 1,000, giving you the CPM number, also known as the CPM rate.
Conversion rate (CVR) is the measure of what proportion of people are persuaded by advertising to take a particular action – such as clicking on a link or making a purchase.
In in-app advertising (IAA), CVR is the percentage of users who saw an app-install ad, clicked on it, and converted through some pre-specified action. In cost-per-install campaigns, conversion is measured by app installs.
The CVR formula is calculated by dividing the number of users who converted by the number of users who clicked on the ad, and then multiplying by 100.
CVR is an essential metric in marketing for measuring ad performance, indicating how well an ad converts users.
IAA, or in-app advertising, is a revenue stream for mobile apps that seek to leverage the app’s real estate to show ads to users. In other words, ad buyers spend in order to display ads within the app.
IAA is a popular monetization strategy for app developers looking to create a revenue stream by selling real estate in their apps to other advertisers.
The way it works is by developers integrating an SDK to connect to an ad network, and implementing user-friendly ad units – earning revenue when users interact with the ads.
The mobile app ads are then served through an advertising network, which connects advertisers and developers. The app requests an ad from the network, and the network uses algorithms to identify and deliver the highest paying ad to the user in real time.
In-app purchases (IAPs) are items bought in-game with real money, or with in-app currency that can itself be purchased with real money, as well as earned through gameplay. For Unity developers, these often come in the form of in-game currency, recurring subscriptions, and more.
This is another popular monetization strategy, and it’s often combined with IAA (in-app advertising) to create a more complete revenue stream for apps.
An example of this is developers integrating user-friendly ad creatives, such as rewarded videos, as a way to increase in-game purchases.
The install rate (IR) of an ad campaign is expressed in percentages and measures how many clicks on an ad it takes to lead to the installation of an app. It is mainly used to optimize CPI (cost per install) campaigns on smartphones.
Just because a user clicks on an ad, however, that doesn’t mean they are going to click on the call-to-action (CTA) and follow through with installing an app.
This is why IRs are useful: They allow app developers to get a sense of how many installations each click leads to.
An IR is calculated by dividing total measured installs by total measured clicks and multiplying the result by 100.
Lifetime value, or LTV, estimates the revenue a single user generates throughout their entire lifetime within an app. It helps predict a user’s monetary value over time, and is calculated by considering both in-app purchases (IAPs) and in-app advertising (IAA).
This figure is directly linked to retention, because the longer a player stays, the more money they put into a game, be it through IAP or viewing ads.
Mobile LTV informs app developers about the effectiveness of their monetization and retention strategies. The aim is to keep a healthy user base with high LTV that both stick around the app, and contribute significantly to app revenue.
Retention rate is the percentage of users who continue engaging with an app over time. It is typically measured in days after users first install the app (i.e., seven days (D7), one day (D1), etc.).
Mobile app retention rate helps app developers determine when in an app’s lifecycle users begin to drop off. Understanding why users are churning and correlating those drop-offs with low-retention users helps determine a course of action to improve retention.
A common practice is to use cohorts, which allow app developers to use behavioral data to observe users and determine the causes of the churn.
Return on advertising spend (ROAS) is a revenue-based metric used to calculate the efficiency and performance of digital advertising spend.
In the mobile world, this often refers specifically to the amount of revenue generated by in-app purchases (IAPs), advertising impressions, and app subscriptions.
ROAS is a useful metric to compare the profitability of different ads, ad campaigns, or ad platforms, and forecast how much money you’ll get back if you increase spend on a set of ads.
ROAS is calculated by dividing the amount of revenue generated by an ad campaign with the amount spent on that ad campaign.
Mediation, also known as ad mediation, is an app monetization solution that allows developers to manage and optimize multiple ad networks in one place.
Mediation platforms search ad networks for the best inventory for developers and manage sending ad requests to increase fill rates in placements that make sense for a determined ad strategy.
Ad mediation platforms also allow developers to rank ad networks in order of preference, so they can amplify their monetization efforts. If their top ad networks are unable to fill an ad request, the ad mediation platform defaults to lower-ranked networks and attempts to fill the request with another network.
Looking to learn more about mobile marketing terminology? We have you covered. Visit the Unity Ads Glossary for more terms and definitions that will help you navigate monetization and user acquisition efforts.