CPE - payment model for the user involved in mobile retargeting

    Getloyal's product manager, Nikolai Sternyaev, explained to us what a CPE model is in retargeting, what are its pros and cons.

    Advertisers, launching mobile advertising campaigns on standard models, often face the following difficulties:

    • CPC model (cost per click): there is no opportunity to buy traffic more expensive than the established CPC. It is necessary to determine and set bids for different sites. This complicates the work, trite, you need to take into account each time the conversion with different campaign names.
    • CPA / CPO model (pay per action): it’s difficult to predict the amount and rate before the start of the campaign, requires the launch of the test, slowly scales and, as a result, it’s not always possible to forecast the budget.

    There are also advantages, for example, according to CPC, advertising campaigns can be scaled very quickly, while working on CPA / CPO, there is less risk for the client that traffic will not pay off.

    We wanted to find some kind of balance that would allow us to better predict the result with less risk for the client. Thus, the idea of ​​a new model in the mobile retargeting market appeared: CPE - an analogue of CPI in User Acquisition.

    What is CPE?

    CPE is a payment model for the user involved. In fact, the payment is made for users who have switched to a mobile application when interacting with advertising. This model allows advertisers to more effectively return users who have already installed a mobile application on their smartphone.

    The number of paid users is calculated not as the number of clicks, but as the number of reattributions - conversions reattribution / re-engagement in popular tracking systems (Adjust, AppsFlyer and others).

    CPE model features

    This model is a step higher in the funnel: CPC> CPE> CPA> CPO. Unlike CPC, only clicks that led to the opening of the application will be paid. It also takes time to build a cohort and estimate the payback time for traffic, and the CPE allows you to scale quickly. But at the same time, the risks that the traffic will not pay off, remain.

    The convenience of the CPE model is that it is more versatile, since it allows you to run retargeting at several sites at once under the same conditions, and also scale quickly. An example for clarity: the cost of traffic is more expensive on MyTarget and Facebook, and the conversion is higher; RTB traffic is on average cheaper, but conversion is lower. Thus, the cost of CPE will not depend on the site, but will depend on the audience. It should be noted that on RTB inventory, as a rule, more expensive sites give a higher conversion.

    Mobile retargeting problems and CPE solution

    The ideal picture in retargeting is when all users go to the final page or to the application. Applicable to mobile retargeting: when conversion from clicks to reattribution approaches 100%. But in practice, we do not often see such a conversion. There are several reasons for this:

    • The user could delete the application and redirect it to the stop. The more we work with an older audience, the more users who have deleted the application, the less conversion.
    • The advertisement is not always rendered correctly, and the user redirects to the stop. So, the conversion will be high on Facebook or MyTarget, and on the RTB inventory will be lower. First of all, this is due to the fact that the technology deeplinks, universal links, app links are quite new and often change, not everyone has time to adapt to changes.
    • Another resulting problem: the tracking of existing analytics systems does not always work correctly. It is often difficult to integrate deeplinks or universal links with the tracking used. Those. even if the user has switched to the application, the conversion may not be counted.

    When running on CPE, problems like the deeplinks or universal link setup curve are visible immediately. The partner is the first who is interested in solving these problems, as a result, the launch is possible when everything is working correctly. This will provide better quality UX retargeting campaigns, the main indicator of which is conversion to the opening of the application.

    Summarizing the advantages of the CPE model:

    • Effective budget spending: pay only for really returning users;
    • You can quickly scale an advertising campaign;
    • The model is universal, you can start working on several sources at once;
    • Qualitative UX: clicking on an advertisement, the user is redirected to the desired screen in the application;
    • Transparency: each reattribution event is reflected in the client's tracker;
    • Target targeting: you can buy users more expensive than the set price per click.

    Cons CPE model:

    • There are risks that traffic will not pay off;
    • Resources are required to set up links and tracking;
    • Must set different rates for different audiences.

    If the CPE model suits you, and you have long wanted to try how mobile retargeting works - contact the Getloyal team! In two years of work, we managed to launch retargeting for 30 different categories of mobile applications.

    The text of the article is published on Apptractor: apptractor.ru/marketing-monetization/ad-networks/cpe.html

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