How the free phone service app has become an alternative ID after textATT6

As mobile device IDs fall by the wayside, monetizing in-app advertising inventory is more difficult than ever.

The app-based phone service TextNow, which is subsidized by free calls and texting ads, is particularly risky for the ongoing depreciation of mobile device IDs. The company monetizes its offer on any Internet-connected device by using in-app advertising, which is responsible for the “huge majority” of the company’s $ 103 million revenue in 2021, said Evan Thor, director of ad monetization and operations at TextNow.

Following Apple’s AppTracking Transparency (ATT) initiative, more and more iOS users are opting out of allowing their device ID – known as IDFA on the Apple platform – to be used for ad targeting. And the upcoming Privacy Sandbox changes for Android will completely shut down Google’s Ad ID by 2024.

Prior to the ATT, about 30% of TextNow users opted out of providing their IDFA, which the company considered less than ideal. After Apple launched the tracking prompt, TextNow felt an “adequate effect” that accelerated the opt-out rate, Thor said.

“As users are given more choice, and data policies and privacy laws become stricter, we need to invest in solutions that allow us to monetize users in a privacy-secure way and alleviate the impact of addressability concerns caused by disappearances.” Identifier, ”Thor said.

Effects of ATT

Post-ATT results weren’t disastrous for TextNow’s ad business, but its iOS app “entered a limited time frame.” [ad revenue] Increased as a result of ATT changes in iOS 14 updates, ”said Thor.

So TextNow started testing alternative IDs, turning to InMobi’s UnifID and LiveRamp’s Authenticated Traffic Solutions (ATS) and RampID. The solution works on agreed-upon traffic, increasing the addressability of users who choose to allow their device ID to be used for tracking.

TextNow measured the baseline performance of its agreed user base on iOS, then applied alternative ID solutions to see how it would affect the fill rate and CPM for ads targeted to agreed users. UnifID allows publishers to integrate ID solutions from multiple partners into their technology stacks, but in this test, TextNow only uses LiveRamp’s ATS and RampID.

TextNow chose LiveRamp ATS because it was “one of the first to penetrate deeply into the app and beyond the web context,” Thor said. To use Identity Solutions, TextNow has installed InMobi’s SDK, a longtime partner, which it has not done before.

Integrating LiveRamp’s ATS into InMobi’s SDK connects TextNow’s ad listing to more than 400 marketers using ATS, says InMobi VP Ram “TK” Krishnamurthy of customer success. When they use their DSP (such as Trade Desk, Xandr or MediaMath) they see RampID in inventory and bid accordingly.

Restoring addressability increases CPMs: “If [I’m a credit card company and] I know you are one of my valuable prize members and I would like to sell you a gold credit card, I am going to pay a lot more CPM for that impression. That’s the decent thing to do, and it should end there. “

TextNow compares ads sold using RampID with placement results for ads sold without RampID.

Experiments have shown that eCPM for native ads increased by 146% and for banner ads by 35%. Banner ad completion rate using RampID was 73% higher.

“The results reaffirm a number of things that we believe to be true about traffic without identifiers – for example, low filling rates and low CPMs – and it shows that there is still much work to be done as we move towards uncontrolled traffic,” Thor said.

Preparing for the future

TextNow is hopeful that this experiment with alternative IDs will prepare for an additional rise in device IDs rather than reacting to these changes, Thor said.

“When new developments come, we’re ready to take them,” he said. “With the change of iOS, we were riding the wave as it was. But the long horizon for Google gives us the ability to predict, plan and ensure that we have built sustainability into our model. ”

Now that it has been ATS tested, TextNow plans to add LiveRamp’s Bloom Filter, an on-the-device way, to make its uncompromising user base more addressable.

TextNow’s direct sales team goes back to the basics, including plans to expand. It is also shrinking internal first-party data activities to further protect advertising revenue from changing its programmatic business addressability.

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