Swaarm focuses on privacy-enabled user acquisition for mobile games

Usually privacy and advertising do not go well together. The more you know about someone, the better you can target ads to them.

But Swaarm saw the writing on the wall when Apple proposed privacy restrictions on third-party ads in mid-2020, and then implemented the change in spring 2021. And so it developed privacy-aware user acquisition technologies. That’s one reason Swaarm, which was founded in October 2020 after the changes were announced, was able to secure a seven-figure funding round this summer.

Advertisers will no longer target a specific user in Manhattan on a specific phone with a specific internet protocol address — unless the user has specifically consented to giving them that information for a specific app. By making it clear that Apple (and eventually Google) required users to sign in, Apple (and eventually Google) put an end to this kind of precise targeting in the name of protecting user privacy. That means Apple no longer allows IDFA data to be shared with third parties without express consent.

With only a minority of users giving consent, the privacy push has been disruptive for mobile game developers and publishers, who had previously relied on the data to drive billions of dollars in user acquisition spend to keep players coming back to games or new play ones. The result has been lower mobile game revenues, acquisitions selling out mobile game companies like Zynga (to PC console mobile game publisher Take-Two Interactive for $12.7 billion), and changes in strategy (such as Tilting Point moving to blockchain games). Meanwhile, Apple’s own Search Ads business has tripled during the pandemic.

Part of the downturn in mobile gaming has nothing to do with the privacy surge, as macroeconomic conditions have deteriorated and the surge in activity we saw in gaming at the start of the pandemic has subsided.

By targeting groups of people rather than specific people, Swaarm can help target similar people without invading privacy, Yogeeta Chainani, co-founder of Berlin-based company Swaarm, said in an interview with GamesBeat. I met her at Gamescom in Cologne.

Swaarm introduced an iOS 14-compliant attribution chain method called Privacy Enabled Attribution (PEA Chain) — the first of its kind in the mobile advertising industry. Swaarm launched its analytics tool, Explorer, which gives marketers the insights they need to run their businesses.

When Apple proposed deprecating the Identifier for Advertisers (IDFA), “the idea was not to identify the user because they were fine with identifying cohorts or groups of cohorts,” Chainani said. “And that’s exactly what Apple is doing with SKaD (its replacement attribution system). But she [don’t] want us to accurately identify the user.”

She added: “So we’ve implemented a privacy-enabled attribution where we don’t collect the cohort, the user’s source information, or identify the user at all. We’re just naming the source information that can be used – on the business side of things for the advertisers, they can still tweak. But at the same time, we keep in mind that we don’t identify individual users or for anything, so they can’t be attacked for that.”

This source information relates to where the users come from.

For example, in our case, let’s assume that most of our companies report which publishers they work with. It could be websites or demand-side platforms (DSPs) or supply-side platforms (SSPs) that users are coming from.”

And so the advertisers end up with a group of people who like strategy games or something like that.

“Let’s say you have five different publishers for ad games. They are working to identify the publisher’s source, e.g. B. which publisher these users are from. When you see your overall Key Performance Indicators (KPIs) with Publisher #2, they’re a lot better. Then you know you need to focus on marketing efforts in that direction. We’re basically helping advertisers do that.”

Swaarm hopes to drastically simplify the daily tasks of digital marketers. Founded in October 2020, Swaarm has established itself as a leading player in the performance marketing space. Its martech tracking platform enables agencies, advertisers and networks to measure, optimize and automate their marketing efforts at scale.

His clients from around the world include Apptrust (Poland), Adcrate (SEA), GoWithMedia (Israel) and ZinkAds (India). Swaarm will use the funding to fuel international expansion and product development, and to further build out its infrastructure. Swaarm is already serving customers across North America, Europe and Asia and will use the money raised to increase its presence in new and existing markets. To expand its global footprint, Swaarm is doubling the size of its team.

Chainani said she’s seen advertisers move a ton of money from iOS to Android, but she reckons it will be difficult to retarget individuals if Google enforces privacy restrictions on Android. And so it hasn’t exactly been very stable in terms of the advertiser environment.

“It’s hard for them to know exactly what’s happening,” Chainani said. “Many advertisers are stepping back to see how the market fares.”

Chainani noted that consolidation is also taking place among mobile game companies and adtech companies. Apple has been driving some of that consolidation, and the global downturn is likely driving more of it.

As much as possible, Swaarm tries to be a one-stop marketing solution for mobile game publishers. It can handle performance marketing, influencer marketing, or social media marketing. Over time, Swaarm hopes to offer this integrated marketing as a single solution.

“There are many companies, but also a lot of demand,” Chainani said.

Chainani said the company was trying to solve the problem of acquiring users at scale. And it spent a couple of years trying to solve that problem with its own proprietary technology, rather than following a standard route. It was an arduous process.

That’s important in the post-IDFA world of user acquisition, as venture capitalists don’t like funding game companies that only use their funds for user acquisition, which is less effective than it used to be.

Advertisers want to be able to attribute or find out where a user who buys something in a game is coming from. Did an ad motivate you to buy? In the past, it was easier for mobile game and app makers to figure out this attribution thanks to partners like Facebook. The data was used and then made anonymous and finally deleted. But Apple truncated this data to let third parties use it.

Chainani said the industry has adopted the privacy-enabled solution. Other companies in the adtech space are taking similar approaches.

“We were the first to introduce privacy-enabled attribution,” Chainani said. “It was great from an acceptance and results perspective.”

Still, the results are slightly lower than the ability to perform precise targeting. And that has bothered mobile games and app companies. You can also draw a line between Apple’s privacy practices and Meta’s decision to lay off 11,000 employees last week.

More disruption is likely to follow if Google does something similar with its “privacy sandbox” for Android users, which is being tested. Both Apple and Google recognize that governments around the world (particularly the European Union with its General Data Protection Regulation in Europe) are cracking down on user privacy violations.

“They’ve been working on this for years,” Chainani said. “Google is running a series of tests. They try different approaches.”

With games, the benefit is that more people choose to share information than usual.

“I saw that too because the users are loyal to the games and they don’t mind if these game companies collect a little bit of their information when it comes to the games,” Chainani said. “Obviously it’s very different in hypercasual games when players jump from one game to another.”

Swaarm’s customers are mainly advertising agencies and advertising networks. These work with game clients. Last year, Swaarm was one of the top five finalists in the App Analytics category at the Mobile Growth Summit. It has 20 employees.

Going forward, Swaarm will focus on pillars such as automation, innovation and customer focus. It launched a tool that automates end-to-end manual workflows. Work is also underway on projects for next year.

“Everything we’re working towards is a combination of those three things,” Chainani said. “That has always been our focus. We were very fortunate in how we performed given the macro factors.”

Regarding what the mobile game companies should do, Chainani said they should keep in mind that Google’s changes are also coming and that they choose a platform that will help them be more efficient when it comes to privacy-related deals. They should also keep their costs low.

“If they take those factors into account, it’s a way for them to get through it,” she said.