While app launching is the most significant task for app developers, monetizing their apps to create a revenue stream is yet another daunting mission.
App developers are constantly looking for better ways to monetize their apps while keeping their user experience intact.
It is not surprising anymore that advertising can make or break your app. In today’s digital era, capturing the user’s attention requires creativity. Different ad formats provide varied benefits in terms of monetization and revenue optimization. Therefore, choosing the suitable ad format for your mobile app is essential.
Interstitial Ads and Banner Ads are the most popular ad formats for in-app advertising. These ad formats have been used extensively by app developers over the years. Now, the question arises, which of these two ad formats generates more revenue? Let’s find out!
Overview of Interstitial Ads and Banner Ads
Interstitial ads and banner ads complement each other in many ways. Let us get an overview of the two ad formats before discussing other factors that influence the app’s ad revenue.
Interstitial Ads
Interstitial Ads are full-page ads that appear at natural transitions in an app. They can be presented in a static or interactive format, including texts, videos, images, or rich media. When an interstitial ad is displayed, the user can navigate and reach the ad destination or close the ad and return to the app.
Interstitial ads are available for iOS and Android devices, and the Interstitial ad size depends on the device dimensions. Usually, the interstitial ad’s timer shows the ad countdown where the users can click and skip the ad once the timer ends.
Banner Ads
Banner Ads are one of the oldest available ad formats and can be easily integrated into an app. They are rectangular, system generated, static or dynamic displays. Banner ads appear at the device screen’s top, bottom, right or left sidebars and refresh automatically after a certain period.
The Banner ad size can be fluid or set to standard as defined by the constant. Nevertheless, the ad size and the ad unit id must be the same. Banner, large banner, medium-rectangle, full-banner, leaderboard, adaptive banner, and smart banner are the different banner ad types.
Interstitial Ads vs Banner Ads – User Experience
In an Ad, winning over the audience is purely based on the user experience. Ultimately it comes down to the ad format and how the ads are designed. Focusing on UX for a seamless user ad experience will also help establish your brand.
Banner ads are great for a positive user experience because the users don’t pay attention to ads or dismiss them because of “banner blindness”.
Interstitial Ads, on the other hand. can be intrusive to the users. Therefore they are placed at natural transition points or the end of a level in gaming apps.
Interstitial Ads and Banner Ads Placement
While targeting maximum user reach, deciding when and where to place the ad is essential. Poor ad placement will not only affect the user experience but also reflects on the ad revenue.
While Interstitial ads are highly compelling, banner ads sit silently on the edge of the screen without interfering with the user or the app content.
Interstitial Ads Vs. Banner Ads: Performance
Performance is an essential criterion in deciding on an ad format. The following metrics must be taken into account while assessing the performance:
- eCPM: also referred to as Effective Cost Per Milli, shows the revenue earned per 1000 impressions.
- CTR: also known as Click through rate, is the percentage of users who clicked on the ad after viewing it.
- Impressions: are the number of times an ad was shown to the user.
- Fill rate: is the percentage of times every ad request showed an ad.
- Engagement Rate: is the percentage of users who interact with the ad or cause an action after viewing it.
In interstitial Ads, the ad impression, eCPM, and CTR are considerably higher than in Banner Ads which eventually yield a higher ROI. You can choose to set a frequency capping of one Interstitial ad per hour for one unique user as suggested by Google. This is done to prevent the number of times an ad is shown to the same user.
Studying your target audience and their response to a particular ad format would be best. In some cases, combining the two or other ad formats might work best for your app and increase revenue.
Interstitial Ads and Banner Ads: Advantages and Disadvantages
Each ad format has its advantages and disadvantages; understanding them will help you choose the best format for your app.
Interstitial Ads
Pros:
- Interstitial Ads have 100% viewability and monetize all the users, including the ones who don’t interact with opt-in ads
- Interstitial Ads generate higher eCPM and CTR rates
- The engagement is higher as Interstitial Ads are likely to grab their attention due to their size
- When incorporated in the right places, they behave as a perfect buffer during app load time
Cons:
- Interstitial Ads can annoy the users and are highly intruding
- If proper guidelines are not followed, it may lead to a penalty or app suspension
- Interstitial ads decrease the retention rate and conversion rate over time
- Higher bounce rates and app uninstalls.
Banner Ads
Pros:
- Banner Ads are cost-effective and easy to integrate into an app
- Banner Ads do not cause interruption to the user
- Banner Ads exhibit higher delivery
- Banner Ads are tailored to the user specifics.
- User retention is not affected
Cons:
- Banner Ads are less engaging
- Too small to be noticeable
- Lower CTR and eCPM
- Banner ads have a low conversion rate
Final thoughts:
Practically, there cannot be an ideal ad format. While the debate on which ad format generates the most revenue is still on, publishers and app developers are required to consider other factors and look at the bigger picture.
Experimenting with app monetization strategies and implementing ad formats based on app layout and user requirements will help grow your app revenue in the long run.
Compared with traditional banner ads, Interstitial ads generate higher revenue when used correctly. Interstitial ads also have a higher engagement rate, while banner ads offer marketers the to scale their campaigns effectively.
App businesses are highly influenced by customer behavior. So, it would be best to study how the target audience will respond to a particular ad format or a combination of formats in your app. Leave that to our experts at Appbroda, – we help curate the best ad formats that work for your app.
