Mobile in-app ads boost intent 82%: IPG study

Study validates Kiip strategy of targeting at moments of peak engagement

Kiip’s strategy delivers rewards at engagement high points

A new study from IPG Media Lab and Kiip claims that rewards-based mobile advertising drives brand favourability and purchase intent significantly more than mobile banners, which actually hurt the consumer’s perception of the brand.

Rewards-based mobile advertising, pioneered by San Francisco-based mobile startup Kiip, gives brands a chance to engage consumers when they’ve reached a goal or earned an achievement in a mobile app. Mobile rewards “moments” include things like finishing a task in a to-do app, getting a best score in a fitness app, or reaching a new level in a game. At moments like these, brands can give users either physical or virtual rewards, like a coupon to a local store, or an extra life in a game.

IPG Mediabrands, which has used Kiip’s reward ads on many clients’ campaigns, decided to run a market research test to evaluate the channel’s performance, using their research team at IPG Media Lab. They tested 1,283 app users on Any.do (a task management app) and Unblock Me (a game) over a three-day period, showing users banner and reward ads for real brands in auto, CPG and entertainment categories.

The post-test survey found that although users who were shown banners had an easier time recalling the brand (72%) than those shown rewards (69%), the increased awareness came at the cost of favourability. Users who saw banners liked brands 6% less than those that didn’t see any ads, suggesting they saw the banners as a nuisance.

But users who earned rewards liked the brand 10% more than those that didn’t see ads. Rewards also outperformed banners on all six measured brand attributes, including “premium,” “modern” and “a brand I would pay more for.”

But the biggest story was purchase intent, said IPG Media Lab Managing Partner Chad Stoller. Thirty-one percent of users who received rewards say they were interested in buying the brand, compared to just 18% who saw banners.

According to Stoller, rewards consistently outperformed banner ads on intent, regardless of the app being used or the sector the brand belonged to.

He said it was the most surprising result of the study –that he expected a lift, but nothing so drastic. “If I’m a QSR and I want you to buy my BOGO offer, that would really make a difference to my business –at the cash register, this week.”

Intent was especially high for virtual rewards, like in-game currency and extra lives. Users who received virtual rewards were 133% more likely to say they’d buy the brand than those who saw no ads. The study claims this extra boost comes from the instant gratification of getting a reward you can use immediately, rather than an offer you can redeem later.

Mobile moments get your heart rate up

IPG coupled the study with an in-lab experiment that measured biometric indicators like facial expression and pulse to determine consumers’ emotional engagement at different times during app use. Sixty-one participants were asked to play a mobile game; each of them saw an interstitial at the beginning, and a reward at the end.

Not surprisingly, the experimenters found that users’ excitement and positive attitude were highest as they reached the goal at the end of each level. Users were 40% more excited when they saw the reward screen than when they saw the interstitial at the beginning.

Stoller said that by linking together excitement and brand performance, the study validates Kiip’s strategy of targeting consumers at moments when they’re feeling most positive and engaged.

And those influential moments don’t only happen in mobile. “Now we’re looking at, how does that work across other devices? How does that work across other ecosystems?” he said. “What does that moment look like when someone walks in front of an outdoor board? Should we look at that, now that outdoor boards are digital, and you can put cameras and iBeacons on them? It opened up a new way for us to think about physical experiences.

Correction: The original version of this article said Kiip was based in Vancouver; although its founder is from Vancouver, the company’s headquarters is in San Francisco.

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