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APP:Why is Applovin so awesome, but others haven't learned from it?

FUNDA·November 8, 2024

Truths behind Applovin's Quarterly Report

First, let's introduce what Mediation is:

In simple terms, DSPs are various ad bidding companies, and mediation is a bidding platform that centralizes all bids and ultimately matches advertisers with traffic owners.

Applovin has significant advantages in doing both mediation (ad aggregation) and DSP (demand-side platform):

  1. Picking up bargains in pricing: This is equivalent to being both an athlete and a referee. The platform can manipulate and optimize bidding costs in the dark. For example, after knowing the bids of the first and second places, it can obtain the opportunity to display ads with an extremely low premium. To illustrate, if Applovin, as a mediation, learns that Unity bids $1, and if Applovin's original algorithm is to bid $2, now it only needs to change it to $1.1 or even $1.00001.

  2. Collecting more data: The Mediation platform is embedded in the publisher's game in the form of an SDK, which can collect user data, including session information, number of ad slots, the integrity of anonymous user data exchanged between Mediation and DSP, and various intermediate data in various bids (not just the single-word bidding data obtained by DSP).

  3. These advantages are sufficient for Applovin to attempt exclusive tactics: Applovin's crazy subsidies for mediation in the early stage have led to a near-monopoly in the mediation field. If a customer chooses Unity's mediation, Applovin will not access the customer as a DSP. This makes it even more difficult for competitors.

Applovin has data collection advantages different from Unity:

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