AppLovin rebrands its ad platform as Axon, launches ads manager on referral-only basis

Founded in 2012, AppLovin entered e-commerce in 2024 when the company onboarded a few hundred advertisers on an invite-only basis. In March, AppLovin said its its e-commerce advertising business had reached a billion-dollar run-rate. Since then, the business has continued to grow, the company told Modern Retail. Earlier this year, AppLovin divested its mobile gaming portfolio for $900 million to focus solely on its high-growth advertising technology business, which drives most of the company’s revenue. AppLovin says it has 1.4 billion daily active users worldwide and about 150 million daily active users in the U.S.

“We started looking at e-commerce because it’s naturally the largest vertical of advertising,” Rafael Vivas, AppLovin’s vp of growth marketing, said in an interview. “As we started releasing it to customers, we saw, ‘Wow, this product actually has legs.'”

The move into e-commerce was, in part, motivated by the ability to deliver quick, measurable results for advertisers — with about 80% of conversions happening within the first hour, making it easy for brands to see impact and scale up quickly, Vivas said.

Under the new referral program, current advertisers receive codes allowing them to invite other brands to join Axon. Once a referral code is used, brands can begin running campaigns almost immediately, without a manual onboarding process.

Only a few hundred advertisers are live on the platform currently, but the company has seen interest from “thousands of organizations,” according to Vivas. AppLovin hopes to have onboarded “thousands of advertisers” during the invite-only, referral phase. 

The company deliberately scheduled the Ads Manager rollout for Oct.1, just before the year’s busiest retail season. 

“Black Friday, Cyber Monday, holiday spending is like something we’ve never seen before,” Vivas said. “That was the catalyst for us wanting to launch self-serve by this point, because we knew it was going to be such a large season of spending, and we wanted to offer an alternative outside of the massive social ad platforms.”

AppLovin’s Axon software has driven its earnings growth in recent quarters. On its most recent earnings call in August, AppLovin reported a 77% year-over-year revenue increase to $1.26 billion, with adjusted EBITDA of $1.02 billion, an 81% margin. AppLovin’s shares gained 700% in 2024. Management said the referral-based launch of Axon Ads Manager would guide a global rollout in 2026. 

Why brands are testing Axon

Initial advertiser selection was limited to brands with at least $10 million in gross merchandise value. One of those was apparel brand Rhoback, which launched campaigns through Axon in January. 

When the brand first launched, Rhoback was spending about $10,000 a day. It has since tripled its spend to $30,000 a day. AppLovin now accounts for 16% of Rhoback’s total paid media spend, second only to Meta and Google.

“With the AppLovin platform, users are forced to watch the video,” said Caroline Nemceff, digital marketing analyst and e-commerce merchandiser at Rhoback. “They’ll watch it for 30-60 seconds, and their eyes will remain on the phone screen until that little skip button pops up, so the click-through rate is a lot higher.”

Food and supplements brand Paleovalley also joined earlier this year. Eight months after launching, Paleovalley upped its ad spend on Axon by 550%, according to Lauren Croft, Paleovalley’s director of paid media. Today, Axon ranks among the company’s top three channels alongside Meta and Google.

“One of my favorite things about Axon is that it’s unlocking new audiences, which is very important to any brand looking for incremental growth,” Croft said. “With a new audience, you get net new customers. And with net new customers, you get incremental revenue.”

Rhoback’s Nemceff agreed. 

“With the AppLovin platform, it skews more female, so we’ve been able to scale up our women’s campaigns a lot faster than our male campaigns, which is great for us.”

Still, brands identified room for improvement. 

Nemceff flagged a lack of targeting options as Axon’s biggest limitation, specifically the inability to exclude past purchasers, which is important for bringing in new customers. She also suggested that it would be helpful if AppLovin added more campaign types, similar to what Meta offers. 

While smaller DTC clients make up the bulk of AppLovin’s e-commerce advertisers, the company also counts enterprise brands like Wayfair, Dr. Squatch and Ashley Furniture among its customer base. Some enterprise clients spend six figures a day on the platform and “see a lot of success,” according to Vivas. For example, Ashley Furniture is “buying profitably, and we’re doing more business week over week, so things are trending in the right direction,” he said. There is no special referral program or incentive structure for enterprise clients versus DTC brands.

Allegations and scrutiny

The rebrand comes amid heightened scrutiny of AppLovin’s advertising practices.

Within the past year, several short-selling firms, including Muddy Waters, Culper Research and Fuzzy Panda, have alleged that AppLovin’s technology relies on fraudulent tactics to bolster its ad business. In March, Fuzzy Panda urged the S&P 500 Index Committee to keep AppLovin out of the index.

AppLovin has rejected those accusations. In blog posts, AppLovin CEO Adam Foroughi has argued that the company’s methods are consistent with industry standards. AppLovin joined the S&P 500 earlier this month.

Despite the controversy, advertisers like Rhoback and Paleovalley say they are seeing measurable gains. Both brands noted that Axon’s performance metrics stack up well against entrenched platforms. 

As Croft put it, “Axon is right there with all of our other platforms. We’re accomplishing the CAC, the CPAs that we need to, we’re accomplishing the ROAS that we need to.”