+2 votes

The company I work at is working on a mobile app in partnership with a larger company. Our contract agreement states that each is obliged to put budget towards UA.

The partner has hired a UA agency, our company has an internal UA team. 

  • Has anyone worked in this situation? How did you manage it?
  • Any ideas about how we can work together, not artificially competing or driving up the price of the acquisition for essentially the same users?
  • What would be the best way to track attribution in this case?

 

 

by (160 points)

2 Answers

+1 vote

I have seen this situation in the wild twice as a consultant, and I’d advise you to do whatever you can to AVOID having two teams working on UA for the same app and to consolidate the budget with just one team.

A situation like this is basically unworkable unless each team operates in a distinct set of geographies. Doing that, you’d avoid overlapping targeting, but it’s still not an efficient way to work. In 2019, there is no reason to not have the UA team operating globally (obviously with some specific care taken to localize and culturalize creatives).

Here are some reasons that a configuration like this is difficult to make work:

  • As you said, if you are operating in the same geographies, you’ll be competing against each other and driving up the cost of CPMs. You’ll also probably be delivering different creatives to the same people, confusing / muddying your messaging;
  • You won’t be able to use view-through attribution in this setup — it simply won’t work;
  • If both teams are spending their own money, then both teams will likely be running their own measurement and evaluating the traffic they buy against their own ROAS models. This isn’t a tenable workflow: what do you do if one team is more conservative about payback windows than the other? Or one includes organic contribution into LTV and one doesn’t? This is a disaster;
  • If the budgets are dramatically different then you’ll run into performance conflicts. Let’s say Team A has a budget of $50k / month and Team B has a budget of $5MM / month. Team A could buy more profitable traffic in isolation (ie. if their money was the ONLY money buying traffic for the app), but with Team B doing media buying, the cost of traffic for that title is likely to be much higher on average, making Team A’s contribution less meaningful. You have to consider what the incremental impact of both teams’ spend is in the context of the total — if there’s a large differential, it might not make sense for the smaller budget to be deployed separately.
by (5.1k points)
Agreed that as a general principle, separate UA teams should be avoided if at all possible. That being said, smaller developers typically won't be capitalized to support a team of 3-5, which is, in my experience, the minimum team size needed to maximize returns.

What I have seen work, to varying degrees of success, is splitting by "channel priority". That is, the internal team (however large) identifies the 2-5 channels that are both most important to the company and can be reasonably managed by this team; the external team (typically an agency) is responsible for executing across all other channels. The biggest drawbacks to this approach, as you outlined, are attribution issues and (potentially) bidding against yourself. However, if the bulk of UA budget is allocated internally to the prioritized channels, spreading out additional budget to experiment with additional channels may yield solid results.

What may be frustrating for most is that there is no best answer. The biggest mistake I see is indiscriminately adopting the team structure/strategy of another company. Available resources, portfolio size, company goals, etc., are rarely if ever consistent across companies, and these elements should be the starting point for making any determination about team construction.
+1 vote
Put the budget into one pool. Don't even attempt to work with the UA agency. This never works for the simple fact that incentives are not the same.
by (890 points)