GREE reaches campaign goals through video ads

Mobile advertising is a balancing act. On the one hand, brands have the opportunity to reach prospects anywhere — at the gym, during a coffee break, and on morning commutes. The challenge, however, is that audiences have competing priorities. Human attention spans, over the years, have become shorter and shorter. Your company needs a high-impact way to make an instant connection.

That’s why video is invaluable for Facebook advertisers. As Mill for Business points out:

  • Videos increase people’s understanding of your product or service by 74%.
  • 75% of users visit the marketer’s website after viewing a video.
  • An average user spends 16 minutes 49 seconds watching online video ads every month.
  • Website visitors are 64% more likely to buy a product on an online retail site after watching a video.
  • 26% of Internet users look for more information after viewing a video ad.

You get the point. Video-based advertising has the potential to 1.) increase brand awareness, affinity and audience engagement, 2.) generate customer demand, and 3.) help prospects through the conversion funnel.

That’s why Facebook introduced its mobile video advertising product in late 2013.

Our Biggest Business Questions

We wanted to understand the impact of mobile video campaigns on Facebook. We focused on the following business questions:

  • Are video-based News Feed campaigns more effective than non-video campaigns?

    This question functioned as a simple A/B test. We wanted to know whether videos generated higher engagement and conversions at lower costs per acquisition (CPA)

  • Can WiFi-only ads increase conversions?

    We know that mobile users are conscious of how much bandwidth they’re using. We wanted to see if we could increase conversions by targeting users who aren’t limited by their data plans.

Our first test was with GREE, the global leader in free-to-play mobile gaming. We suspected that showing audiences a game trailer would pique interest and increase engagement.

The Methodology

To answer our questions, we set up a total of three ad sets (campaigns). We prioritized device-level targeting and then created sub-groups to include our test variations. Here is a diagram that explains the campaign structure:

Device Type Click-through Rate Change Conversion Rate Change CPI Change
Android Video only for Wifi -15% 8% -14%
Video* -13% 22% -15%
Non-Video Baseline Baseline Baseline

The Results

We want to emphasize the following highlights using Non-Video ads as the baseline comparison:

  • When video was added to the Android campaign it resulted in an increase of 22% in conversion rate. The CPI changed favourably as well with a decrease of 15% from the baseline.
  • WiFi ads with video outperformed all groups, in terms of volume, making up the majority of video conversions. With WiFi added in, there was a lift of 8% against the baseline. The addition of WiFi lowered CPI 14% from the baseline.
  • There is a decrease in click-through rate when a video is added, however the users that click are of a higher quality. The significant increase in conversion rate and a lowered CPI outweigh this decrease.

What We Learned

Here are the takeaways from this test:

  • It’s important to include WiFi-only ads, likely because users are hesitant to download games on their expensive data plans.
  • Android devices are great for testing—video ads are comparatively less expensive than their iOS counterparts.
  • WiFI is especially important when trying to control CPI.

Advertisers need to decide what a user is worth to them. This factor depends on recurring revenue and long-term user value, or LTV. Mobile video has the potential to be more cost-effective than image-based advertising.

Remember that at the end of the day, cost is only one side of the equation. Test your campaigns to see what revenue you’re able to generate in the long-haul.  Make sure to deploy strategies, like videos, to increase performance.