Usually in-app ads are displayed within a mobile app, such as banners at the top or bottom. The more advanced are Facebook auto-play videos and Twitter sponsored posts.

It’s hard to say which ad format works best, as it all depends on your goals and testing results. For example, video can be helpful when you don’t have any brand recognition. If you see a display ad for Starbucks that says “Download now for free coffee,” one may click on the ad immediately to redeem this offer. But if the same ad comes from a new app, you may not understand why you should care about it. In this case, video could be more effective than display advertising in the new app, because it can visually illustrate what the brand is doing. Compared to different ad formats, making sure that an ad is relevant to the user while simultaneously presenting it in an non-invasive manner is more important. It is the relevancy of the ad that makes it compelling as opposed to simply the ad type.

Although ad formats are less important than relevancy, online researches show that in-app banner ads don’t generate the best revenue compared to other ad formats. Around 60% of users don’t click banner ads because they don’t trust them. On the other hand, in-feed ad offerings provided by big social networks, like Facebook and Twitter, are highly targeted, immersive, and less intrusive, however they are also expensive.

What should app marketers do if they can’t afford high rates?

If you are an app startup and you want to become a profitable company, you absolutely need to figure out the best ways to drive users that are also cost-efficient. If you cannot get a return on paid advertising, one of your alternatives is to engage with your community, find out who their influencers are, and build strong relationships with them. But if you plan to experiment with paid premium advertising, the best advice is to make sure you know what your goal is for that return and how you are going to get it. Try to target the best way you can and experiment with all kinds of ad formats. You can start with one banner, one video, and one interstitial and A/B test them. Each ad format brings its particular share of target audience and your goal is to focus the biggest shares.

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