Food for Thought: Effective In-App Ads for Food and Beverage Brands

Last Updated on: 28th May 2024, 04:51 pm

Food & Beverage marketing is entering a new era. As the march toward mobile-first connectivity gathers pace, businesses in the Food & Beverages industry are starting to focus on mobile-first solutions and build engaging apps. But with competition being so fierce in the F&B space, there’s a pressing need to stay top-of-mind. In-app advertising provides an answer—with more targeted ads, brands can keep users engaged to gain an edge over the competition. Here’s what you need to know in a nutshell:

• Food & Beverage apps are becoming more varied and sophisticated as they grow in popularity.
• Food delivery apps are still outpacing grocery delivery apps, but the gap is closing. 
• Apps that use retargeting ads retain more users for longer.
• Deep Learning-powered in-app advertising can drive up to 42% more sales at an average 11:1 return on ad spend.
• Food & Beverage brands should look for ads focusing on brand consistency, user retention, and results optimization.

We’re taking a look at the most compelling stats about F&B apps, showing how you can maximize the performance of your app with targeted ads powered by Deep Learning.

What’s on the menu?

• Food & Drink apps in numbers.
• The impact of retargeting on retention rates.
• Improving Food & Beverage app retention rates with retargeting. 
• Food for thought: tips for creating winning ads for the F&B industry. 

Food & Drink apps in numbers

You know the saying, “There’s an app for that.” In the Food & Beverage industry, like any other, there really is now an app for everything. Users can find and rate restaurants, reserve tables, browse and order from online menus, find recipes and buy ingredients, get dietary, health, and allergen information, take advantage of great deals through loyalty programs, and much more.

App downloads in the Food & Beverage market reached 1.95 B in 2022. The top 5 apps alone have been downloaded nearly 300 M times globally:

Food delivery app installs are higher than pre-pandemic levels. They were 5% higher in 2022 compared to 2020 and up 34% over 2019.

And it’s not just takeout that is winning over customers. In the U.S., online grocery customers number roughly 150 million shoppers, close to half of the country’s population, and this is forecast to continue to rise. This shows that people’s buying habits are fundamentally changing.

According to recent findings, it costs 6 to 7x more to acquire new customers than to retain existing ones. And with data showing that Food & Beverages apps have a 33.48% uninstall rate, it adds even more of an incentive to keep users engaged with relevant and personalized in-app retargeting. Add to this the fact that the click-through rate of a retargeting ad is up to 10x higher than that of a typical display ad, and the takeaway is clear—brands that prioritize retargeting are making their marketing budget go further; they win retention, more conversions, and generate more revenue.

The impact of retargeting on retention rates

The way people shop has shifted, but the devices they use are also changing. The percentage of people accessing the internet via mobile devices is increasing year-on-year, and 2017 saw mobile traffic surpass traffic from desktop computers. As of January 2024, the percentage of mobile web traffic stands at 59.01%. People now want information—and the ability to buy products—in the palm of their hands. This is why mobile apps are so appealing. They meet potentially loyal customers exactly where they are browsing.

However, it’s much easier to compel a user to install the app than to then entice them to continue to engage with it. Research shows that by increasing customer retention by just 5%, brands can increase their profits by 25-95%—the revenue generated by your app is directly associated with its retention rate. More engagement = more revenue. It’s why user retention is such a major focus for Food & Beverage apps.

But the right kind of in-app retargeting campaign underpinned by exceptional technology can help. According to research, apps that run retargeting campaigns have up to 70% higher retention rates at day 30 and up to 85% higher retention rates at week 12 in comparison to apps not leveraging retargeting.

Front of house—serving up ‘stickiness’ and increased revenue

If you have managed to get a user to install your Food & Beverage app, congratulations, that’s great. You have served them an ‘app’etizing starter. But with 74% of app users churning the day after an app install and the retention rate for Food & Beverages apps standing at just 14%, now starts the real challenge—driving those first-time conversions and making your app ‘sticky’ enough to hold onto. 

To make your app something users will crave again and again, you need in-app retargeting underpinned by the best technology out there. This is why RTB House uses Deep Learning-powered algorithms, which are more efficient and flexible than standard Machine Learning. With them, you can drive first-time conversions, increase sales from active users, and re-engage lapsed users. Along with first-class creatives and industry expertise, this is how RTB House can scale the revenue from the retargeting channel by up to 50% while maintaining agreed campaign KPIs.

Tips for creating winning ads for the F&B industry

The best way to develop effective in-app advertising for your Food & Beverage brand is to start with the goal of your campaign. Are you launching a new app or service or trying to get better results from your existing one? When you know this, choose your campaign type and then keep your focus on the following three things:

1. Increase engagement and order frequency
   There is intense competition in the F&B market—if an app doesn’t stay top-of-mind, users will switch to another application. There’s an imperative to keep users engaged and prompt them towards repeat purchases. Aim to re-engage dormant or inactive users, as these are the people who cared enough to put your app on their device but still need a nudge to start using it more. This group offers great potential for uplifting revenue.
2. Unleash personalization
   When you have people on board for longer, target them with personalized content that makes your app feel special and gives them relevant offers. And remember that each user is different. Your technology should be able to assess each opportunity to engage and reach people the right way.
3. Maintain brand consistency across environments
   Whether it’s on the web or your app, create in-app campaigns that have a look and feel that is consistent with all your marketing activities. Seek providers with best-in-class creatives that fully adhere to your brand book. Your app is an extension of your core brand, not an alternative to it.

Deliver more with us

Want to know more about how RTB House works specifically with Food & Beverage businesses on desktop, mobile, and in-app ad campaigns? Visit our dedicated industry site and find out more: www.rtbhouse.com/offer/for-industries/food-beverages.