The mobile app-install ad is driving a boom in mobile ad spend
Mobile app-install ads (which prompt users to download a mobile app) offer the most measurable return on investment, according to Business Insider. They are becoming increasingly popular as they help companies stand out from the millions of apps in the Google Play and Apple app stores.&nbsp;Social networks and ad exchanges like them because they can sell the units at significantly higher prices than other ads.
BI Intelligence

The mobile app-install ad — an ad unit that directs users to download a mobile app – arguably offers the most measurable return on investment (ROI) of any major mobile ad format, and has seen a massive rise in popularity among marketers.

These ads are becoming an essential tool for apps seeking to stand out among the millions of mobile apps on the Google Play and the Apple app stores. On top of strong performance, including high clickthrough rates, marketers like app-install ads because their value can often be accurately quantified.

And, for major mobile platforms, including Facebook, Twitter, Yahoo, Google, and smaller mobile ad platforms like Millennial Media, the high prices these ads commands make them very attractive inventory.

New and exclusive data from BI Intelligence finds that US mobile app-install ad revenue will top $4.6 billion this year and grow to $6.8 billion by the end of 2019, increasing by a compound annual growth rate of 14% from 2014. We believe mobile app install ads accounted for about 30% of mobile ad revenue last year.

Here are some of the key takeaways:

Mobile app-install ads are becoming extremely popular ad units among different types of app publishers, not just game-app developers. App marketers — including e-commerce companies and a few brands — like these ads because they result in significant downloads and measurable ROI. Social networks and ad exchanges like them because they can sell the units at significantly higher prices than other ads.

Easy-to-measure ROI drives demand. In many cases, once an app-install ad generates a download, everything a customer does in the app, such as "lifetime customer value," can be attributed back to that specific ad.

On Facebook, mobile app-install ads cost significantly more than standard units, due to performance and targeting capabilities. The report includes CPM pricing and CTR rates compared to the average Facebook ad.

Prices will hold relatively steady as supply and demand rise in tandem. The mobile install ad is a fairly mature ad unit at this point, and a good deal of competing supply is now available from Twitter and Google. But continued increases in demand for these ads among app marketers will keep prices from declining.

Top mobile publishers and ad networks are competing fiercely for mobile app-install ad dollars, and for the favor of app developers. Twitter and Facebook are doing their best to lure app builders to their platforms and app-install ads with advanced ad analytics and developer tools.

In full, the report:

Forecasts spending on mobile app-install ads in the US over the next five years

Puts total revenue in context of mobile ad spend and Facebook mobile ad spend

Analyzes how mobile-app install ads are priced and bought, and looks at how pricing and performance trends have changed over time

Highlights the mobile app-install ad units available from major players like Facebook, Twitter, Yahoo, and Google

Examines the different types of marketers that have put the ad format to use

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