How ad-supported game monetization can be a win-win-win for publishers and gamers

How ad-supported game monetization can be a win-win-win for publishers and gamers

This article is part of a Gaming Insights series paid for by Facebook. 

It’s no secret: Around the globe, mobile gaming is established as a key part of people’s daily lives. Gamers continue to be satisfied with the ad-funded model. And more and more developers rely on in-app ads and hybrid monetization as a dependable game revenue channel.

But here’s what is new from our latest research — Why The Ad-Supported Model Of In-game Advertising Is A Win-Win: integrating in-app ads in games has led to over half (51%) of gamers playing longer sessions[1]. And this is true across most genres and regions.

In addition to increasing session length and engagement, in-game ads revenue continues on an upward trajectory. By the end of 2019, in-game ads accounted for 17% of total worldwide smartphone gaming revenue ($82.6B), a percentage that is expected to triple by 20242.

In existing and new markets, the growing mobile gaming community has been fuelling in-app ads revenue growth over the last three years. Since the 2017 research, we’ve seen a 7% increase in the number of active gamers across Western and Asian countries and Brazil, Russia and Turkey. Now, roughly two-thirds of people globally are playing mobile games every day.

From player sentiment to preferred ad formats, we’ve summarized what you need to know from this new report, to help maximize the revenue potential of ads in your games.

Players are happy to watch ads, but they expect fair treatment.

While gamers understand why ads are necessary, the relationship they have with in-game ads is transactional – they enter into it willingly but expect to be treated fairly.

One way to respect this sentiment is to make players feel that they are in control of how and when they see ads. 71% want to be able to choose whether or not to click or view an ad. As such, opt-in formats like rewarded video and playables that deliver an in-game reward are preferred.

As publishers seek to leverage monetisation trends, they should also note what could turn players off from gaming. Players can become frustrated with ads that interrupt the game and create a “loss of momentum” in the game experience. To steer clear of this, publishers should keep an eye on how ad format, frequency, and placement affects player engagement.

That said, there is little evidence in-game ads lead to a high level of churn. Nine in ten players stated that ads had not impacted their desire to keep playing mobile games on more than one occasion.

What does this mean for publishers? Creatively integrate ads to maximize engagement.

In addition to determining the right ad frequency, publishers also need to find creative ways to integrate ads into the game to maximize player engagement and avoid gameplay disruption.

What is the sweet spot number of ads to serve in a session? The report found that positive perceptions of ads increase when players see between 0-9 and 10-25 ads. But there is no further increase in positivity when players see 26 or more ads in a session; in fact 75% of players said that this was “too many” ads. Based on that data, 10-25 ads per session is the sweet spot, where perceptions are highest but before the feeling of ad overload.

Players want to see useful, interesting and relevant ads

When asking players from key markets to rank the most important ad attributes, useful (44%) and interesting (40%) were followed closely by relevant to me (38%). All are in agreement that ads that are not well-targeted can be a frustration. Additionally, some markets are more sensitive than others to lack of localization or ad relevance.

What does this mean for publishers? Consider how ads reflect on the perception of your game.

In general, publishers should feature useful, interesting and relevant ads. But also to be aware that these variables are ranked a bit differently in every market (more about that in the full report).

Additionally, publishers should avoid and/or remedy poorly localized, low-quality ad visuals or jarring music, as it can reflect less favourably on both the ad and the game.

In-game ads encourage players to play for longer and more frequently.

Understanding how and when to integrate the right ad formats in your game can help increase the amount of time and level of engagement.

A survey respondent shared, “If you watch a 30-second video and get an extra life or some currency for the game, it gives me an extra boost to keep playing, especially if I was low on lives in the first place!”.

Respondents surveyed shared the following positive comments on why their in-game ad experience motivated them to play longer:

  • 53% “I got rewards from the ads”
  • 38% “Ads helped me unlock gameplay/levels”
  • 31% “I liked what the ads were showing”
  • 30% “They didn’t interrupt my gameplay”

What does this mean for publishers? Leverage player-preferred ad types.

Publishers who are looking to maximize engagement and session length, and minimize churn should leverage player-preferred ad types like rewarded video and playables.

In our research, rewarded video stands apart from all other ad formats as the most useful because it gives gamers something to use immediately to progress in their game. One player shared: “The best kind of ads are where you can earn some in-game currency or reward. The developers get the ad revenue, and you get rewarded in the game. It’s a win-win.”

Playable ads offer players an opportunity to discover, play and test games during a game session, without having to commit to downloading them. When creating playables, publishers should craft them to represent the final game as much as possible to ensure expectations are met.

The in-game ad format that best delivers on the players’ need for “interesting” content is playable ads. Considered the most “enjoyable” ad type available, this perception is replicated in all markets tested.

In short, mobile gaming is embedded in people’s lives and showing no signs of decline. Gamers are happy and engaging with ad-funded games, and game businesses are growing accordingly. In-app monetization models are a win-win-win for players and publishers.

Dig deeper: Download the full July 2020 report “Why the ad supported model of in-game advertising is a win-win-win”.

Márcio Freire is Publisher Solutions Manager, LATAM and Scaled, at Facebook Audience Network.

[1] Source unless otherwise specified: Mobile Games Advertising Report 2020, 2CV (commissioned by Facebook Audience Network) – a quantitative and qualitative study in UK, US, DE, FR, TR, BR, AR, KR, JP, RU and VN between March to May 2020 on the changes in the mobile game advertising since 2017 and how advertising impacts players, July 2020.

2 IDC – Worldwide Mobile and Handheld Gaming Forecast, 2020-2024. Published March 2020

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