Brief:

• Google is expanding where and how app publishers can market their products, opening up inventory on its main site's Discover feed, along with in search and in-stream video on YouTube, according to a blog post by Sissie Hsiao, VP of product for mobile app advertising.
• App campaigns running in the U.S. will automatically get a boost in Discover — previously known as Google Feed — which displays relevant news and content to 800 million monthly users. Google plans to expand Discover app campaigns to all markets by the end of 2019. App advertisers can also now fill the top spot in YouTube mobile search results.
• Beyond the broader inventory for app campaigns, Google is alpha testing a format that serves ads to users while their app experience is loading, with the intention of helping publishers generate more revenue. On the analytics side, the company announced it's expanding smart segmentation options, introduced earlier this year for interstitial ads, to rewarded ad units, and integrating new features to AdMob in beta that monitor for abnormal changes to metrics like effective cost per mille, impressions and revenue.

Insight:

Google is considerably expanding ad inventory and campaign monitoring tools for app advertisers, recognizing the booming market for segments like mobile gaming. The slew of product updates follows other new ad solutions Google has put a spotlight on this year as it looks to diversify revenue streams for its core search business and key offerings like YouTube.

At its annual Google Marketing Live conference, the company unveiled the first Discovery ads, which are now opening up to app install campaigns. At the May show, Google additionally previewed a gallery ad format for search and a bevy of new shoppable options across Google Images, YouTube and a revamped Google Shopping platform — part of the tech giant's >growing advertising battle with Amazon.

The fresh app campaign push is targeted at categories like sports, music and mobile games, Hsaio wrote, but the latter seems to command a particularly strong focus. Google shared the news at Think Games at ChinaJoy, part of a gaming expo in Shanghai.

Google trying to court more mobile gaming marketers isn't surprising. Gaming apps made up 74% of spending in app stores in 2018, according to a report App Annie published in June. One-third of all mobile downloads globally were for gaming apps last year.

One reason mobile games generate so much revenue is due to microtransactions, where users pay real money to buy virtual features or in-game currencies. Google's tests of a new open app format signal the company is looking to find other ways for publishers to better monetize their users and keep them engaged over the long term.

"Finding the right users is important, but developers need to think about growing overall revenue in order to build sustainable businesses," Hsiao wrote. "By integrating ads during natural break points in your app you can build a new revenue stream and deliver a better user experience."

Google, which controls 96% of the market share for mobile search, recently showed small signs of recovery after a period of declining ad growth rates. Its parent company, Alphabet, posted 16% year-on-year revenue gains to $32.6 billion in Q2 earnings results released last week.