The Evolution of Mobile eCPMs, 2021-22

The mobile advertising industry has been in a state of flux over the past few years, as marketers, developers, and publishers deal with changes around privacy and the economy. By looking at the average costs paid out on a per-impression basis, it’s possible to understand how mobile advertising has evolved so far and what can be expected going forward.

For this effort, we recently analyzed the eCPMs (cost per 1,000 impressions) paid out by some of Moloco’s biggest advertisers in the mobile gaming industry. Mobile gaming has long served as a bellwether of overall mobile advertising trends. By looking at spending trends stretching as far back as 2020, we can begin to understand how the industry has evolved so far and what to potentially expect for the rest of the year and beyond.

How ATT Impacted Mobile Advertising

It’s hardly surprising or controversial at this point to say that Apple’s App Tracking Transparency (ATT) dramatically changed the mobile advertising landscape. By making the Apple’s Identifier for Advertisers (IDFA) opt-in instead of opt-out, ATT largely removed a key device-level identifier from the valuable iOS ecosystem. 

As such, in the immediate aftermath of ATT’s launch in 2021, iOS eCPMs dropped. For many marketers, it just wasn’t worth it to spend on a channel that suddenly seemed unaddressable, and they moved budget out of iOS and into Android, where device-level targeting appeared more straightforward. According to mobile ad exchange InMobi, Android eCPMs rose by 20% while iOS eCPMs fell by 16% between January and July 2021. 

Moloco has observed a similar trend in relation to native ads. In the US, native ad eCPMs on Android rose by around 63% between April 1 and August 1 in 2021. In comparison, native ad eCPMs on iOS dropped by about 50% during the same period.

How ATT Impacted Interstitials and Video Ads 

Interestingly, this drop was not universal. Between the beginning of April and the end of September 2021, interstitial banner and video ad eCPMs were more or less stable in the US. In fact, video ad eCPMs on iOS actually went up slightly during this period.

One potential explanation is that marketers became more comfortable with SKAdNetwork (SKAN) and Apple’s changes by the time Q3 2021 rolled around. It’s also highly likely that marketers saw the value in reaching iOS users even without an IDFA attached to them.

Mobile Ad Pricing in 2022

In Q2 2022, CPM trends of iOS and Android campaigns were similar. In major markets in Asia, North America, and Europe, CPMs were mostly stable. 

In some instances, eCPMs actually declined slightly throughout the quarter. The only major exceptions were interstitial banners on Android in the US and iOS interstitial banner ads in Korea, which saw eCPM increases as a result of increased competition. 

In looking at Q2 2022 compared to the same period in 2021, US eCPMs were much lower. For example, Android interstitial banner ad eCPMs were down 20% year-over-year.

This all points to a normalization. In short, marketers have largely become accustomed to today’s post-ATT world and today have a much stronger idea on what’s needed to see mobile advertising success on both iOS and Android.

What To Expect in Q3 and Q4 2022

Considering everything that has happened since iOS 14.5, what can mobile marketers expect this quarter? 

In Q3 2021, Android eCPMs in the US rose overall in September after staying mostly stable in July and August. On iOS, eCPMs were flat throughout the quarter.

But this isn’t all that anomalous. In looking at trends from Q3 2020, we see a similar trend. Two years ago, eCPMs were largely stable in July and August and then trended upward in September. Although the data tells a story about cost seasonality, looking at longitudinal trends across a multi-year timeframe suggests the beginning of Q3 2021 wasn’t much different from past years.  

By September, kids in the Northern Hemisphere are back in school, and summer vacations are officially over. It’s also when marketers begin to ramp up their holiday-related campaigns, such as for Halloween and Thanksgiving in the US or Singles Day in China.

As such, it seems reasonable to assume that eCPMs in August 2022 will remain relatively stable and then increase somewhat in September. Of course, it remains to be seen whether economic headwinds such as inflation will impact September and Q4 ad spending this year.

It will be interesting to see what ad spending looks like throughout Q4. CPMs tend to rise at the end of the year in many key parts of the world due to the holiday shopping season. And for the first time ever, the World Cup will take place in Q4, which will likely lead to a further rise in CPMs.

That being said, in parts of the world where Christmas is celebrated, CPMs tend to drop by December 25. Here at Moloco, we call the period between Christmas Day and early January Q5. Stay tuned to the blog for more about this unique time of the year.
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