Opportunities of the Open Internet for App Advertisers

With Stephen Lowe, Growth, Moloco

Moloco offers machine-learning advertising solutions using real-time, first-party data, helping mobile app advertisers acquire users on the ‘Open Internet.’ We sat down with Stephen Lowe from Moloco to discuss the opportunities the Open Internet offers for mobile app marketers.

Define ‘The Open Internet’ in relation to app advertising.

Advertisers and marketers constantly seek new ways to reach and connect with customers as the mobile advertising landscape evolves. The ‘Open Internet’ comprises digital spaces outside the ‘walled gardens’ of Google, Meta, and Apple – and offers opportunities to reach audiences in a broader range of online environments. In the mobile context, open internet inventory consists of in-app ads used by mobile apps to monetize their inventory.

“At Moloco, we have access to publishers across more than 40 exchanges, which enables advertisers to reach users outside the walled gardens. This offers a potentially huge audience spanning 3M independent mobile apps that reach 6.8B devices in more than 190 countries.”

Stephen Lowe, Moloco

It is important to remember that the open internet offers a complementary, incremental channel for app marketers. Rather than viewing these options as opposed to each other, advertising on the open internet can be considered a way to reach new or incremental audiences to drive profitable growth. They should complement each other, not compete with each other.

“The Open Internet should be viewed as complementary to walled gardens. This should not be an ‘either-or’ equation and requires careful planning. People move between the systems, so advertisers should do the same.” 

Megan Price, M&C Saatchi Performance

Key considerations for app advertisers when regarding the open internet

For app marketers, there are many opportunities. However, the open internet requires a differentiated, specialized approach. Below are a few key areas that are important for marketers to understand:

• Understand the ecosystem: The open internet ecosystem differs from walled gardens. It comprises a vast, decentralized ecosystem of independent apps, exchanges, and multiple advertising platforms. Best practice guidelines that apply to campaigns within walled gardens (e.g., creative) are different on the open internet, and specialist knowledge needs to be applied to these campaigns.

• User time spent vs ad spend: Users spend 66% of their time on the open internet, yet only 40% of media dollars are spent there. This means that mobile app marketers have a significant opportunity to tap into a less competitive ecosystem to drive profitable growth where users spend significant time.

• Machine Learning is the key to success: The open internet can seem complex and overwhelming. However, this is where advanced Machine Learning (ML) thrives. ML means campaigns can be built and calculated at a granular user level, predicting which ad to serve users profitably based on first-party, contextual, and campaign data. Machine Learning is not there to replace the programmatic experts behind the campaigns but to supercharge the learnings and insights, giving optimizations an added edge. 

• Transparency and control: Programmatic buying provides visibility across the full supply path, which means superior granularity. This means marketers are able to have the flexibility and control to make data-driven decisions about where and how their ads show and to whom. Measurement and attribution then provide an understanding of the effectiveness of such optimizations on your KPI.

How can the open internet help advertisers reach their target audiences efficiently and at scale?

The entire programmatic ecosystem takes milliseconds to deliver an ad via an auction. There are huge advantages to working with partners using advanced machine learning methods. For example, any bid request could come through multiple exchanges. Thanks to the Moloco tech stack, we can identify where to bid for an impression at the most cost-effective price. Advertisers can buy according to outcomes such as CPI, CPA, and ROAS, enabling advertisers to achieve their campaign goals effectively.

It is also worth mentioning brand safety. While the typical best practice is not to set guardrails and let ML learn where the most valuable users spend their time, blocking certain apps for brand safety reasons is also an option.

What areas of development are happening with the Open Internet?

Exciting areas of development include Connected TV (CTV), where inventory is being opened up to more advertising platforms, including mobile app providers. This streamlines the media buying process for marketers looking to reach audiences via the big screen with new and exciting inventory.

Similarly, Retail Media Networks (RMN) are starting to follow the same trend. As more RMNs proliferate, they constantly seek new demand sources to connect marketers with their users. This inventory will likely be available to mobile app marketers to tap into a new channel with the same benefits as advanced machine learning.

The development of Connected TV and Retail Media Networks in recent years points to a significant widening of the programmatic ecosystem that mirrors where consumers spend their time. The wealth of data to be leveraged from retailers becomes even more valuable in the face of privacy changes.

Megan Price, Programmatic Supervisor at M&C Saatchi Performance, agrees; “Despite the challenges posed by an increasingly privacy-focused landscape, brands can still unlock significant growth opportunities by combining the flexibility of programmatic advertising with the valuable audience insights provided by retail media. As privacy regulations tighten, brands must find innovative ways to reach and engage consumers without relying on third-party data.”

How can app advertisers run campaigns on the Open Internet in the era of increasing privacy?

As signal loss continues to rise, especially in environments like iOS, where user data is limited, app marketers may see this as a significant hurdle. First-party data remains valuable, and marketers should work to adapt their martech stack to futureproof their first-party data and ensure it captures the right signals to inform media decisions. 

An equally valuable real solution lies in leveraging Machine Learning. ML can analyze all available data points—contextual, behavioral, and campaign data—and make accurate predictions, even when first-party data is unavailable. Moreover, ML leverages 1P data from similar other users to make predictions. In short, by using a platform with advanced machine learning, marketers can optimize targeting and bidding strategies based on real-time insights across various sources.

Predictions

1. Advanced Machine Learning will become even more critical.

As the mobile app marketing landscape grows increasingly complex and privacy regulations lead to ongoing signal loss, advanced machine learning (ML) is quickly becoming the key to future success. The fragmented ecosystem makes finding and engaging valuable users more challenging than ever, while restrictions on user data (especially on iOS) limit the effectiveness of traditional strategies. ML offers a powerful solution by analyzing all available data in real-time making accurate, automated decisions on targeting, bidding, and engagement. Finally, not all machine learning is created equal, and it’s extremely hard to build models that drive performance for advertisers; therefore, working with partners with this expertise is essential.

2. Future Proofing Measurement is essential.

Future-proofing measurement through a measurement framework consisting of Attribution, Incrementality testing, and Media Mix Models will become essential. Signal loss is inevitable, but this measurement trifecta protects advertisers with both a top-down and a bottom-up approach to measurement. Those with a defined measurement framework will be ahead of competitors and more likely to unlock profitable growth. 

3. CTV and Retail Media will continue to grab attention.

The partnerships between retailers and streaming TV services will continue to develop. Retailers gather first-party and purchase data, which is used to build partnerships, such as Roku and Walmart or Walmart’s partnership with NBC Universal.

Measurement with CTV has improved dramatically over the past couple of years, giving brands greater confidence in the impact of their marketing spend. Coupled with ongoing advancements in targeting capabilities driven by key partnerships, we can expect investment in Connected TV to continue to grow at an accelerated rate. 

In Summary

The Open Internet offers advertisers significant benefits, especially when planned alongside campaigns executed within walled gardens. However, with an increasingly complex and fragmented app ecosystem, designing, testing, and evaluating alongside trusted partners is more critical than ever.

Contact us to learn how we help clients win in a highly competitive mobile landscape.