Here’s a thought, or rather a theory, that we’d love to run by you.
It starts with a little piece of irony. Most advertisers want people to buy their product, i.e. pay for it. When an app (on any platform) is free and sponsored by ads, a large portion of its user base will be people who want something for free. If we’re allowed to generalize here, they don’t want to pay if they can avoid it.
Spotted the problem yet?
How do you sell to people who don’t want to pay? This dilemma will be even more pronounced in apps where there are paid, ad-free options in addition to the free, ad-sponsored version. The most valuable customers for advertisers would be the ones who paid for an app, not the ones who opted for the free version.
This is a problem that in-app advertisers will have to somehow overcome if they don’t want to simply waste a large portion of their advertising efforts, which means:
Promoting something free.
This is of course not a new trick, but it makes even more sense when advertisers are targeting someone inside a product that is free. It essentially becomes an exercise in simply getting customers in the door, hoping to sell them something once they’re inside.
The question now is, how effective is that, really?
Yes, this was a super-short post, but we thought it was an interesting thing to bring up. What are your thoughts on this?
