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We started this series of analysis of the main monetization metrics that every app developer must know and master, with the fundamental metric of eCPM. In this new release we will focus on a metric of great importance and that, combined with the eCPM, sheds more light on the advertising performance that is obtained from the advertising networks. This metric is called Fill Rate.
The fill rate represents the percentage of ads served successfully by an ad network. Its formula is expressed thus:
Fill rate = (number of ads delivered / number of ads requested) * 100
The process is as follows: An app requests its advertising network to display ads under a series of conditions and parameters, and this, in turn, searches for it among its inventory. If there is success, the ad is shown in the app.
It can depend on many factors, not all of them controllable by the developer or the advertising network. The user may leave the app before the ad is served, a loss of user connectivity, there may be no inventory available from the ad network or it may spend too much time showing the ad.
In a perfect world each request would be returned with an advertisement and therefore the fill rate would always be 100%, but unfortunately this is not the case. If we are aware that it is almost impossible to obtain a 100% fill rate, it is desirable to be as close as possible to this figure because each unrequited ad request is a missed opportunity to earn money for the developer. Even if you get a good eCPM from your advertising network, you will generate little revenue from advertising in your app if it is offering you low fill rates. Therefore, experts highly advise considering these two metrics, eCPM and Fill Rate, together in the performance analysis of an advertising network.
Let’s see it with an example:
Suppose that the advertising network A offers us an eCPM of 10 $ to a 25% fill rate and the advertising network B offers us an eCPM of 2.5 $ at a 70% fill rate. Our app sends 1M of requests to the two advertising networks.
What will be the result in terms of revenue and what will be the most profitable network?
1,000,000 * 0,25 = 250,000
250,000 / 1000 = 250
250 * 6 = 1500
1,000,000 * 0.7 = 700,000
700,000 / 1000 = 700
700 * 2.5 = 1750
Under the same number of requests, we see how the advertising network B offers greater profitability. Despite serving cheaper ads, it does so more frequently and consistently.
However, is this option always preferable? The ideal is to see how the two metrics fluctuate and find the perfect equilibrium between them. The balancing act is crucial: when one of the two metrics varies, the income can decrease. App and game developers should think in terms of revenue instead of spending a lot of time trying to get the highest possible eCPM. As shown, sometimes a lower eCPM at a better fill rate can lead to higher revenues for the developer.