Mobile gaming: When is the right time to use a third-party retargeting partner?

This article was inspired by a recent episode from Remerge’s Apptivate podcast, featuring Pablo Bereskyji. Pablo is the Marketing Operations Manager at Etermax, an international gaming company headquartered in Buenos Aires, Argentina. Pablo previously worked in business intelligence and financial analysis at Acuris, The Mergermarket Group, and Debtwire.

You can listen to episode 93 of the Apptivate podcast through this link.

There have been no signs of anyone pressing the pause button within mobile gaming lately. During the COVID-19 pandemic, the market hit new heights, with consumer spending exceeding $22 billion in the first quarter of 2021. This represents an all-time high and a 25% growth, year-over-year.

Considering this boom and the overall value of the industry, it’s little wonder gaming apps are investing heavily in user acquisition (UA). However, retargeting remains an important revenue driver for app marketers, even with the arrival of Apple’s App Tracking Transparency (ATT) framework. Retargeting and re-engagement campaigns have not lost any momentum - the volume of ID traffic is still high, and many are taking full advantage of this to build solid and loyal customer bases.

For gaming apps, retargeting is a powerful way to keep users engaged and playing regularly, while at the same time incentivizing paying users to spend more, and more often. As it costs less to retarget a user than to acquire a new one, planning for long-lasting retargeting campaigns is a smart investment - but where do companies start if they have never worked with a third-party partner before? When is the right time to bring in a DSP and what must businesses consider when doing so?

Gaming apps tend to spend big on UA to increase their user base, so keeping retargeting costs as lean as possible is a priority for many companies in this space. For Pablo Bereskyji and the team at Etermax, doing this with an in-house solution was an insurmountable task: “By looking at the cost of running [retargeting], it was almost impossible. We found pockets of profitability, but that is most likely because we hit installs.”

Facebook is generally the first stop for marketers who are testing new tactics. However, for casual gaming apps like Etermax’s Trivia Crack, marketers must invest their budget wisely and consider adding alternatives to their strategy. The value these gaming platforms generate from a single user can be high, but it’s often not on the same level as major e-commerce players. Lowering costs by exploring the open programmatic market is crucial.

Scale is a massive factor to consider when looking at retargeting as a marketing activity. This refers to a DSPs ability to reach a large number of mobile users. Being present in the open exchange and having access to a high volume of impressions means a DSP can observe more auction outcomes and learn the market prices for different traffic components more efficiently.

This was vital for Etermax when their team was making the leap to a third-party partner. They opted for Remerge and as Pablo Bereskyji explains, “Having access to an open exchange in that way, because of the amount of volume that [Remerge] picks up in terms of impressions, you were able to get a lower price point than what we were looking at with Facebook, and by doing it ourselves.”

When it comes to retargeting, adding a third-party partner to the mix opens the door to a more diverse marketplace that allows companies to further grow their audiences. Programmatic advertising provides access to hundreds of thousands of publishers, with bid prices that are set by the market. This strips away the dependency on self-attributed networks or walled gardens, such as Google, Facebook, and Twitter, as app marketers can set their own parameters in terms of how, where and to whom they advertise.

It’s also key to identify where the revenue opportunities are when exploring the viability of retargeting. At Etermax, pinpointing the value of payers was a game-changer and drove their decision to use a third-party partner.

Like many gaming apps, the Etermax team first focused on getting payers to enjoy the game in order to encourage in-app purchases. When they landed on retargeting as a next step, however, they required the expertise of a strong partner to do this efficiently:

“The CPC [Remerge] was getting and the discovery of payers as a potential target - that drove the decision to use a third-party vendor. We are 90-95% ads revenue based; we have a massive DAU in that sense and a lot of that goes through impressions and not payers.”

While gaming apps will not veer from UA, they must continue to maximize the value of their core customers by ensuring they are fully engaged with the product. If loyal users churn or lose interest, there should be a strategy in place to win them back.

Before businesses start thinking about retargeting, it’s fundamental that they have a product that is set up for the best user experience. After all, why spend money trying to keep consumers when the app is not ready to retain them or service them in the best possible way?

On top of this, app businesses must lay the foundations for success. Retargeting is not as simple as giving someone ads, setting up a few tracking links and looking at the results in an MMP. Companies need to do churn analysis, retention modeling and figure out how much they can afford to pay to engage past or inactive payers; all these systems have to feed into one another, and with the technical infrastructure of third-party vendors. This is not easy and involves a considerable amount of effort, but when done right, the payoff is more than worthwhile. Not only will this lead to high performance and increased revenue, but marketers will be more confident when running campaigns as they can trust that the data and subsequent insights are real.

Remerge is the award-winning app marketing platform that helps the world’s most ambitious apps grow their business, drive revenue, and boost user loyalty. As of May 2021, Remerge has expanded its services beyond app retargeting and is now also offering user acquisition for ID and no-ID users.

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