Pouring on Tier-3 from FB: how to save money?
Tier-3 countries are a real treasure trove for webmasters. Here you can find a vast audience with a penchant for gambling, as well as take advantage of inexpensive traffic, which allows you to maintain significant volumes with a constant positive ROI. In many arbitrage teams, these regions account for a solid share of total traffic.
The main challenge of working with cheap geos is that app rental costs can eat up a significant portion of revenue. This is due to low CPA rates and weak install2dep conversion rates, which is common in Tier-3 countries.
A key factor that affects profits when traffic volumes are high is the installation cost to be paid to app providers. On average, the marketplace price is around $0.2 per iOS app install for Tier-3 countries.
Now let's compare the profitability of traffic for iOS apps with an install price of $0.2 (with aredna prila) and $0.1 (with private prila from any available builder), using a few Tier-3 countries as an example. We'll take:
- Zambia, where CPA rates are very low but install2dep conversion rate is high;
- India, where CPA rates for Tier-3 are above average, but install2dep conversion is low;
- Bangladesh, where CPA rates are average, as well as conversion.
All calculations will be based on an average ROI of 100% per geo, excluding installation costs.
Zambia
Zambia is a young and promising geo in Africa, where there is a growing interest in gambling and the cost of traffic is still very low. As many advertisers are just starting to explore this region, you can see impressive reg2dep conversion rates here, comparable to Tier-1 countries.
One of the most effective strategies in this region is to use creatives with games like Crash, as the simple and engaging gameplay attracts the attention of the local audience:
Internet access for African users has only started to expand rapidly in the last few years, leading to a rapid increase in online activity. This process has provided a strong impetus for locals to engage with social media advertising. Thanks to this trend, advertisers can effectively attract large volumes of traffic at minimal cost, which opens up a wide range of opportunities for arbitrageurs in the region.
The average install cost for geo is $0.3-0.4. Meanwhile, install2reg's average conversion rate holds at 50%, while reg2dep on iOS reaches 20%. Hence, install2dep's conversion rate for Zambia comes out at 10% on average. In this region, the average CPA rate ranges from $7 to $8.
To get one deposit, you need to attract 10 installs, each of which costs approximately $0.35. As a result, the base cost per deposit, excluding app rental, is $3.5. Now let's see how the net profit will change with different price per install - $0.1 and $0.2.
If the setup price is $0.2, the additional cost per deposit is $2, which increases the total cost from $3.5 to $5.5. In this case, the net profit per deposit would only be $1.5, giving an ROI of about 27%.
However, if the setup cost is lowered to $0.1, the cost per deposit drops to $4.5. This would increase the net profit to $2.5 per deposit, which is 40% higher. The ROI would then rise to 55%, making this scenario much more profitable.
India
India is the largest market among Tier-3 countries and has long established itself as one of the key countries for gambling arbitrage. Over the years, many advertisers and products have managed to build effective strategies to retain players on a long-term basis, allowing them to offer webmasters higher CPA rates.
India has a huge gambling audience, due to which webmasters can run lucrative bundles for months without facing a drop in ROI. In addition, the online gambling market in the country continues to grow in volume every year, which opens up new opportunities for arbitrageurs.
In India, the average install price for iOS ranges from $0.5-0.6. The install2reg conversion rate is at 50%, but reg2dep in India is lower than in Africa, averaging 6-7%. Hence, the overall install2dep conversion rate for India on iOS is around 3-4%. For a minimum deposit (mindep), they pay around $30-40 here.
It will take around 30 installs to get one deposit. With an install price of $0.5, the cost per deposit comes out to be $15.
Now let's break down the scenarios with different setup prices: $0.2 and $0.1.
-With an installation price of $0.2:
The cost of renting the app will be $6 per deposit. In this case, the total cost per deposit would be $21 ($15 for installs + $6 for prilla). With an average CPA of $30, the profit per deposit would be $9 and ROI would be 42%.
- With an install price of $0.1:
Installs costs will drop to $3 per deposit. This will reduce the total cost to $18 ($15 for installs + $3 for prilla), which will increase the profit to $12 per deposit. As a result, the ROI will increase to 66%.
Thus, reducing the price per install to $0.1 significantly increases the profitability of the bundle, providing a more attractive ROI.
Bangladesh
Bangladesh has seen remarkable growth in online gambling in recent years. The combination of an actively growing gambling audience, cheap traffic and the constant appearance of new products on the market makes this region attractive for arbitrageurs. In particular, pouring traffic to iOS apps in Bangladesh remains stable and profitable.
For creatives here, mentions of Asian-inspired slots are particularly effective. The use of local languages and symbols also helps to better engage audiences, creating a stronger emotional connection to the product.
In Bangladesh, the average cost of an install on iOS is about $0.7. Conversion rates are as follows: install2reg is 45-50% and reg2dep is about 16%, giving a final install2dep rate of about 8%. The average CPA rate for a minimum deposit is $18.
In order to get one deposit, you need to attract about 12 installs. With an install price of $0.7, the cost of traffic through Facebook would be $8.4 per deposit.
Now let's look at scenarios with different install prices:
- With an install price of $0.2: The cost for 12 installs would be $2.4. The total cost of the deposit, including all costs, would be $10.8. At a CPA rate of $18, the net profit would be $7.2, giving an ROI of 66%.
- At a setup price of $0.1: The cost of installs will drop to $1.2 per 12 installs, reducing the total cost of deposit to $9. At this cost, the profit per deposit will increase to $8.4 and the ROI will increase to 87%.
Thus, reducing the cost of installs to $0.1 significantly increases profitability, providing almost 87% ROI, making the bundle even more profitable.
Conclusion
When dealing with Tier-3 gambling through iOS apps, many factors impact profitability. The main ones include product conversion, cost of creatives, Facebook traffic costs and app rentals. Optimizing some of these factors, such as product conversion or cost of creatives, can be quite challenging.
The most effective way to increase profits in the current environment is to reduce app rental costs. App rentals are one of the major cost items in Tier-3 traffic arbitrage, and reducing these costs can significantly improve overall profitability. Since it is difficult to reduce Facebook's consumable costs and increase product conversion, reducing app rental costs represents the most affordable and direct way to increase profits.