52.8% of app users consider in-app advertisements useful.

GoodFirms, a globally renowned B2B ratings, and reviews platform, recently released its latest research report, “In-app Advertising: Trends, User Perception, and Challenges.” The survey was conducted to identify the current trends in the In-app advertising market, gather valuable insights about user perception about these ads and challenges regarding adopting the in-app advertising format.

According to the survey, there is a massive market for in-app advertising owing to the surge in the usage of mobile applications and the shift in consumer shopping behavior post-pandemic. The research also mentions that it has become a significant revenue stream for app creators and marketers to promote their products and services. The study further states how marketers can use valuable insights and contextual targeting mechanisms with the help of AI and ML to target relevant users with in-app ads precisely.

GoodFirms research uncovers how in-app advertising has become an effective way for app developers and how they opt for app monetization strategies to generate revenue following the three most popular app monetization models: In-App purchase, subscription models, and in-app ads.

Further, the research unveils the various formats of in-app advertising encountered by users frequently: around 85.2% of users come across Instream video ads that are skippable, while 52.4% of users encounter instream video ads that are non-skippable, 86.7% of users majorly experience banner ads, 39.1% of users primarily run across interstitial ad, and 23.9% of users come across native ad.

Varied pricing models associated with in-app advertising: cost per mile (CPM), cost per click (CPC), and cost per action (CPA).

The research also reveals the benefits of in-app advertising: enhanced targeting, better click-through rates and user engagement, increased revenue growth etc.

Around 56.5% of app users admitted to downloading apps recommended through an in-app ad, where 42.6% of smartphone users have ended up buying products after clicking in-app ads, and 29.5% of app users generally opt to see rewarding in-app videos.

Viewability and fraud, increased use of Ad blockers, delivering the marketing message within a few seconds for which the ad runs, data privacy issues, and increased competition are the significant challenges of in-app ads for both publishers and marketers.

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Moreover, the research analyzes the user perception of in-app advertising: Around 52.8% of app users find in-app advertisements useful and about 56.7% of mobile app users consider in-app ads informative. About 46.3% of respondents termed in-app advertising unwanted and 36.7% of surveyees believe that in-app ads are annoying and often irrelevant. Around 53.9% of app users only watch ads because the ad-free version incurs a cost.

Research also identifies top trends in in-app advertising: increased personalization, prioritizing privacy, a rise in native ads, implementation of AR/VR, incorporation of Artificial Intelligence, fast in-app adverts, shift from Google play store to Apple store, in-app bidding, and the rise in in-app spending.

Key Findings:

• Around 85.2% of smartphone users mostly encounter in-stream video ads.
• 56.7% of smartphone users consider in-app advertising to be informative.
• The increasing use of ad blockers is a significant hurdle to growing in-app advertising.
• Maintaining data privacy is a critical issue that app publishers have to consider.
• Increased personalization is one of the top trends in in-app advertising.
• Prioritizing privacy is a vital trend in in-app advertising.
• The ability of native ads to blend seamlessly with the app content has made them popular amongst marketers.
• Better click-through rates and better user engagement characterize in-app advertising.

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