Why iOS retargeting is the cheat code for positive ROI

Since 2020, many marketers have written off iOS retargeting due to reduced access to deterministic data and speculation of low App Tracking Transparency (ATT) opt-in rates. But recent trends suggest this might be a misstep if you’re looking to drive in-app revenue from high-value iOS users. From Q1 2023 to Q1 2024, gaming app opt-ins increased by 8% to an average of 39% globally. While it takes time to perfect your opt-in approach, from the design of your pre-permission prompt to the placement and timing of your big ask, efforts are clearly paying off.

Gaming app ATT opt-in rates Q1 2024 vs. 2023 (Global)

Source: Adjust Gaming Apps Insights

As opt-in rates continue to rise, so does the number of developers embracing ATT. According to AppsFlyer, this figure is now up to 84% of gaming and 68% of non-gaming app developers. With advocacy has come a lift in ad spend on iOS– up a notable 28% between Q1 2023 and Q1 2024. For comparison, during the same timeframe, Android ad spend only increased by 5%.

iOS vs. Android Ad Spend, since May 2021

Source: Appsflyer 

Simultaneously, marketing budgets have fallen by 30% over the past three years. The effectiveness (and high ARPU) of iOS retargeting could be the silver lining solution to weary assumptions, shrinking budgets and attribution woes.

Why is iOS retargeting making a comeback?

The higher cost to acquire and retain iOS users can understandably put marketers off. However, if you take a look at your analytics holistically, there’s a hidden gem in the long run: It may cost more to retarget iOS users, but they have a higher user lifetime value (LTV) and higher average revenue per user (ARPU). In North America, the difference is particularly stark–iOS users have 5x higher LTV than Android. Basically, they pay off.

With this in mind, it should come as no surprise that 75% of Adikteev’s gaming clients are running iOS campaigns. Leveraging the higher ARPU of these iOS users through retargeting is yielding spectacular results for these clients. A good example is Nanobit, who exceeded ROAS targets by 11% on iOS by retargeting users who made a purchase between 8 to 180 days but not in the last 7 days.

5 dos of iOS retargeting

With a limited marketing budget in mind, it’s important to get this right. Here are some best practices to keep in mind.

1. Do identify points of churn. When are your iOS users likely to churn? Is it a difficult level? Completion of all available levels? The point at which a paywall is introduced? Identifying these pain points will help you address them in your campaigns. Pssst: Check out the churn scorecard to find out when your users will churn!
2. Do segment strategically. Which in-app events correlate to higher revenue per user? Do users who make smaller purchases more often or users who make larger purchases less often result in higher LTV? How soon after their first purchase should users make a second and then a third purchase to ensure longevity?
3. Do personalize your messaging. Use those opted-in users within your segments to create truly custom messaging that’s related to the action you want them to complete.  For example, if you want lapsed payers to return to the app and continue spending, your creative CTAs should reflect that: “Get new gems,” or “New levels to unlock” depending on the in-app features.
4. Do leverage AI and machine learning. If you aren’t using these technologies yet, you’re only leaving room for a competitor to nab those efficiencies. Use prediction tools to identify users with higher revenue potential and know when they're likely to leave your app.
5. Do craft compelling narratives. Leverage each segment’s emotional drivers and internal triggers. Convey how much you value users. Focus on ads that remind users of their recent achievements and incorporate offers that are time-sensitive to create urgency.

5 don'ts of iOS retargeting

On the flip side, here’s what to avoid.

1. Don’t de-prioritize consent. Even as your opt-in rates increase, continue the upfront work to make your future retargeting campaigns easier to personalize. It’s important to optimize both the ATT opt-in prompt and consent banners required by privacy law.
2. Don’t overlook small but significant segments. Smaller segments sometimes have high value, but are overlooked because of their size. However, smaller audiences and budgets can actually lead to high ROAS thanks to better ARPU potential. Keep in mind our strategies with Nanobit for boosting user LTV on iOS.
3. Don’t put all your eggs in one basket. Best practice for ad creatives is strategic diversification. This is especially true between iOS and Android users. Your segments will likely differ between platforms, and will therefore have different needs to successfully re-engage these users. Make sure to match your creative to your segment, then test different variables to find that segment’s sweet spot. 
4. Don't set and forget your campaigns. Successful outcomes require continuous monitoring and testing. Keep an eye on what’s working and what's not to adjust your strategies based on performance data. Your retargeting partner can help set up testing audiences for creatives and measuring uplift.
5. Don’t ignore ad fatigue. Repeatedly showing the same ad over and over can lead to your audience becoming uninterested and not paying attention. Regularly refresh ad content and creatives.

As marketing budgets shrink and opt-in rates grow, iOS retargeting has become a crucial strategy once again. With its potential for higher ARPU, winning back iOS users is a definitive way to boost ROI. Now is the time to reassess and refine your iOS targeting tactics to drive significant revenue growth. Our team of retargeting experts is ready to assist—contact us today to elevate your app's potential.