Tokyo-based startup and mobile ad consultancy AdInnovation announced this week that it has raised 160 million yen (about $1.6 million) from DBJ Capital, SMBC Venture Capital, and Mitsubishi UFJ Capital [1].

The startup was launched back in 2010, and has been providing white-label ad performance tracking solutions to many Japanese mobile ad agencies.  For mobile app developers, typical mobile advertising (such as embedded banner ads) will encourage users to download your app and boost its App Store ranking. But this is not very effective in the long term, and your increase in downloads is typically not sustained beyond the campaign period.

The company’s solution for app publishers is called Adstore Tracking, letting you view mobile ad metrics at a glance on a handy dashboard, with the ability to measure conversion rates of search ads, calculate cost-per-action, or analyze which promotional efforts were most effective.

When I heard about this new funding, I reached out to the company’s CMO Ryoma Hosokawa and project manager Kazumi Hirooka to find out what they’ll do next. Before joining the team several months ago, Hirooka worked at Infocom Corporation where he launched the Japanese Android app portal ‘Tabroid‘.

For app developers, typical ad tracking tools let you find out ROI, but AdInnovation is currently developing solutions that gives you a wider view of how your mobile app is doing. Hosokawa explains:

Such tools are typically designed for marketing people. And they might be satisfied with seeing the results of their promotional efforts. But that’s different from reaching success with your app. We plan to develop a tool that can help you analyze all aspects of the app. It will be probably for executives or producers rather than marketing people.

According to the pair, many Western app publishers are very curious about how Japanese app developers are increasing conversion rates, because they know that their strategies are well thought out. So they plan to bring this tool to the overseas market as well.

These days there are many players in the ad-tech space, such as RTB (real-time bidding) or DSP (demand-side platform) providers. but we’ve seen few solutions that measure ad performance or improve the profitability of mobile apps. They add:

We’re thinking to start our global expansion with Europe. That region has bigger markets than the US in terms of console game sales, so there’s great potential there. In Asia (not including Japan and Korea), consumers are not yet accustomed to paying for mobile apps, so I assume mobile app developers in the region are not ready to pay to improve their profitability. We’ll start in Europe, and move on to the rest of the world, including Asia, later on.

It will be interesting to see if they will evolve the mobile app market in Europe. AdInnovation is currently hiring new talent who can work on the global expansion project. If you are interested in joining the team, don’t hesitate to contact Mr. Hirooka.

Also operating in this space is Seattle-based startup HasOffers which secured a $9.4 million funding from Accel Partners back in May.

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1. DBJ Capital is the investment arm of Development Bank of Japan. The bank is a 100% government-owned financial institution and one of the largest players in corporate loans and private equity investments in Japan. SMBC Venture Capital is the investment arm of Sumitomo Mitsui Banking Corporation. And Mitsubishi UFJ Capital is the investment arm of Mitsubishi UFJ Financial Group. ↩