Mobile app monetization glossary – part one

Mobile app publishers dictionary

Although each platform may use its own terminology (which is why it’s worth checking the documentation, for instance, the Ad quality glossary at Unity Knowledge Center), there are terms universally understood across the industry. These include, among others:

• A/B testing – at its core, it’s a process of comparing two versions of a single variable to see which one performs better. Most publishers use A/B testing for UI/UX (like button colors), but it can also be used in the mobile app monetization optimisation process. For instance, Bidlogic offers powerful tools for A/B testing. The company specializes in this field by automating the optimization of bidding instances and eCPMs;
• Ad exchange (mobile ad exchange) – it’s a programmatic platform that uses real-time auctions to instantly connect advertisers looking for clicks with publishers who have mobile ad space to fill;
• Ad mediation – is a solution dedicated to app developers. Its main aim is the management of multiple ad networks through a single SDK. Most popular ad mediation platforms include AppLovin MAX and Unity LevelPlay. The good news is that Bidlogic supports both of these platforms;
• Ad network, essentially, is a platform that aims to connect the demand side with the supply side. By connecting advertisers and publishers, it acts as the middleman, matching brands that want to show ads with apps that have space to show them;
• Ad whales – in mobile app monetization jargon, are high spenders, a small percentage of app users, usually responsible for approximately 80% off app revenue;
• API (Application Programming Interface) – you can think of it as a set of defined rules and protocols that allows one software application to access the data or functions of another application in order to communicate with each other;
• AppLovin is an ad mediation platform that acts like a high-tech auctioneer, forcing different ad networks to outbid each other for the empty spots in your app. Instead of you manually picking which ads to show, it automatically plugs in the highest-paying options to make sure you’re getting the most revenue possible. It’s essentially the “brain” that manages your monetization so you can focus on building your app while the system handles monatization;
• ARPPU (Average Revenue per Paying User) is a formula that helps publishers to understand, over a set period of time, the amount of money an app can expect to generate from paying users;
• ASO, when you know the rules of App Store Optimization, you are able to improve your app’s visibility in app stores. Traditional strategy included optimizing keywords and title; however, if you want to learn about newer ASO trends, we wrote an article dedicated to that topic;

• Churn Rate – is a vital metric that helps to understand the percentage of users who stop using, uninstall, or cancel subscriptions for a mobile app within a specific timeframe;
• CPC (Cost Per Click) is a mobile app monetization model, a metric that indicates exactly how much an advertiser pays every single time a user taps their ad. For you as a publisher, it’s a way to measure the “clickiness” of your ad placements, as you only earn revenue when a user shows genuine interest by clicking through;
• CPA (Cost Per Action) is another metric that tracks when a user does more than just look; it pays out only when they complete a specific “mission”, like signing up for a newsletter or making an in-app purchase. For publishers, it’s a high-stakes game: it usually offers much bigger payouts than a simple click;
• CPM (Cost Per Mille – thousand) – this is the standard industry pricing for “brand awareness”, where you’re paid for every 1,000 impressions served, meaning you get a flat fee for every 1,000 times an ad pops up on a screen, regardless of whether anyone taps it;
• CPI (Cost per Install), in our case, mobile Cost Per Install, is a performance-based metric where the conversion trigger is a confirmed app installation;
• CPV (Cost Per View) – is a model in which the advertiser pays only after an ad has been watched for at least some fixed time, like 2 or 15 seconds;
• CPCV (Cost Per Completed View) is a similar concept, with the difference that it measures the cost per video ad only when a user watches it from the very first second all the way to the end;
• CTR (Click-Through Rate) is both an advertiser metric (to gauge campaign performance) and a publisher metric (to measure ad spot effectiveness). Basically, it’s the ratio of users who click on a specific link to the total number of users who view the ad;

• DAU (Daily Active Users), and similarly: WAU (Weekly Active Users), MAU (Monthly Active Users) – these metrics represent your active user density; by looking at the ratio (DAU/MAU), you can calculate “user stickiness” to see how often users return;
• Demand-Side Platform (DSP) is a platform used by advertisers to buy ad space automatically across thousands of different apps and websites all at once. Automating the buying process, it allows brands to scale their campaigns across a vast range of inventory instantly;

• Freemium model – it’s an app pricing model, a situation where users of an app can use the most basic functionality free of charge. Such apps are often monetized with ads.

From acronyms to actual revenue

Navigating the “alphabet soup” of mobile monetization, from eCPM and ARPU to TCF and RTB, can feel like a full-time job. But here is the truth: you didn’t build your app to become a walking dictionary of ad-tech jargon! You built it to provide value to users and grow a sustainable business. At optAd360 and Bidlogic, we believe that while the technology behind monetization is complex, your experience shouldn’t be.

PS. Please stay tuned for the next part of our glossary, covering terms from G to Z!