According to Statista, in 2020, ad revenue in arcade games accounted for 63% of total app revenue, compared to the 37% that in-app purchases have contributed. Similarly, ads accounted for 60% of total app revenue in sports games.
Whether ads make up 30% or 60% of your total game revenue, advertising is an extremely important aspect of your mobile game revenue. This has become true for virtually any game genre on mobile.
But which ad format is the best? And which will make the most ad revenue in a mobile game?
This is a difficult question to answer as it depends on several factors, including the type of game, the target audience, and the available ad formats.
However, some general guidelines include ensuring the game is engaging and visually appealing and testing different ad formats to see which generates the most revenue.
In most cases, the answer will be - you should not use only one ad format but the appropriate mix of formats at your disposal.
Ultimately, it is important to remember that each game and each audience are different, so what works for one game may not work for another. Experimentation and testing are essential in finding the right ad monetization strategy for your game.
With that in mind, we’ll break down the most important metrics and strategies and provide some tips on how to use them effectively.
A game's advertising revenue is integral to a game monetization strategy and refers to the income from ads rather than in-app purchases.
Mobile game ad revenue is expected to grow significantly in the coming years as more and more developers adopt it as a critical part of their monetization strategy.
Except for sports games, all mobile gaming categories saw significant growth in ad revenue in 2020, with action and card games being the standout genres.
According to App Annie, 60% more apps started monetizing through ads in 2019 compared to 2018, and 62% of all global digital ad spending in 2018 was aimed at mobile.
These numbers demonstrate that ad monetization in mobile games is becoming increasingly popular and effective and is still relevant despite the jumps IAPs have made in the past couple of years. However, you need a sound strategy to monetize your game ads properly.
Developers earn ad revenue from mobile games by displaying advertisements to game users. Advertisers pay networks to place ads in mobile games, and then those networks share that revenue with the game developers. This allows developers to make money from ads even if users don't make in-app purchases.
Advertisers are interested in reaching a large audience of mobile gamers, so they are willing to reward developers for ad space in popular games handsomely.
However, it's important to remember that mobile game ads can be intrusive and disruptive to the gaming experience. This is why it's important to balance ad revenue and user experience. Too many ads can ruin a game, so finding the right mix is essential.
Understanding your audience and ad placements are key to maximizing your mobile game ad revenue. Advertisers are always looking for new ways to reach their target audiences, and game developers must be ready to provide them with the right opportunities.
By understanding your audience and what they're looking for, you can ensure that your game provides the perfect environment for advertising.
A few key metrics are typically used to measure how much games make from ads.
There is ad revenue, which shows how much your game makes from ads from all of its players.
However, this is not the only metric you should focus on. Other metrics to be on the lookout for are:
• Ad ARPDAU: Ad Average Revenue per Daily Active User - show how much money you make from ads but averaged out across all your users (Daily Active Users). This is a very useful metric because, typically, DAU oscillates all the time.
• Ad Impressions (Ad Views): They show how many ads you have shown in a certain period
• eCPM: This stands for effective cost per mile and shows how much money, on average, you are making for every 1,000 ads you show in your game. These include daily active users (DAU), ad impressions, and effective cost per mile (eCPM).
Many in the industry focus on eCPMs as one of the most important metrics, and rightfully so. So the big question is how does eCPM compare between different ad formats.
Of course, eCPMs vary depending on factors such as geographical region, the specific publisher, the source from which you got your users, etc. Still, we will first mention differences in eCPM between ad formats.
Of all ad formats, offerwall eCPM is the highest. This is because it requires the highest level of attention and engagement from the users and, often, a significant time investment. That is why it is not rare to see an eCPM of several hundred dollars. On the flip side, offer walls are not the proper ad format for many game genres and are suitable only for specific audiences.
Rewarded video ads eCPM is usually also very high, and there are many ways to integrate this format into your game, so it’s suitable for almost any game. This is why rewarded videos are the most popular format among developers nowadays.
Interstitial ads are usually right behind rewarded videos when it comes to eCPMs. The reason is that they, too, are a full-screen (usually video) format that is highly engaging for users and tends to convert.
From the traditional ad formats, banners have, by far, the lowest one. The reason is that they are usually just small, static images that take only a tiny portion of the screen. They also have a lower probability of attracting users’ attention and converting them on a specific ad.
Finally, eCPMs can also vary significantly by geographical region. For example, eCPMs in the United States are typically higher than in other parts of the world. This is because the United States has a larger and more developed digital advertising market than most other countries.
Here are the average eCPM values for different mobile game ad formats:
• Offer walls eCPM tends to be very high, reaching as much as $1500 in some instances but averaging around $400 across all genres.
• Rewarded video eCPM averaged nearly $12, with slightly higher values on iOS, as well as in Japan, the United States, and Australia.
• Interstitial ad eCPM is trailing close behind, averaging close to $9.53 across Android and iOS in the US, with Japan and Australia close behind.
• Banner ad eCPMs are significantly lower, with only $0.50 on Android devices and $0.21 on iOS in the US.
Different genres of mobile games are better suited for different types of advertising. For example, offer walls have a great eCPM, but they're only really effective in serious games with a deep economy.
Rewarded video ads are suitable for practically all genres, except for hyper-casual games where users don't need prizes as much because the game is simple.
Interstitials are usually best for casual games, while banners are only effective in vertically-oriented, casual games.
Remember this when choosing what type of ad to use in your mobile game. Make sure the ad format is appropriate for the genre and style of your game, or you risk turning off your players and damaging your game's potential earnings.
Apart from rewarded videos, offer wall is one of the most popular advertising formats among developers and players alike. Not only do offer wall eCPMs average from $530 across genres to more than $1000 for mid-core games, but they can also positively affect user retention if implemented correctly.
However, offerwalls do not necessarily guarantee good engagement. This is often because completing a task can be time-consuming, or the reward is too small. As a result, not all networks support them anymore. While they are still going strong on Fyber, Tapjoy, or ironSource, they are completely banned on iOS.
Rewarded video ads can be a great way to monetize your mobile game, but the results depend on your game type and how well you integrate them. It's important to plan ahead to achieve seamless rewarded ad integration.
The genre of your game will affect the type of ads you offer and their length and frequency. Showing them too often or showing the same ad too often may hinder its performance (or even help in some brand awareness campaigns).
Remember a few things to remember when creating banner ads for your mobile game. The first is to make sure the ad is relevant to your game and strategically placed not to interrupt the user experience.
While they might be the oldest advertising format, their use is gradually decreasing, owing mostly to "banner blindness"; players have gotten so used to them that they mostly ignore them.
There are a few key things to keep in mind if you want to get the most out of your interstitial ads and maximize your eCPM potential. First, don’t force too many ads on your users, as it may cause them to abandon your game completely.
Rich media content, such as animations and videos, generally leads to higher engagement rates. This, in turn, can result in higher eCPMs. As with everything else in mobile marketing, testing is key. Try different placements, timing, and types of content to see what works best for your game and audience.
The short and the most accurate answer is it depends. While offering walls and rewarded videos generally high eCPMs, they may not work the same for some games. Therefore, the stellar performance metrics don’t guarantee they will help you make money in your game.
The same goes for other ad formats.
You must test different ad types within your game to find the format that will make you the most money. This will help you analyze which ones generate the highest revenue. Keep in mind that what works for one game may not work for another. Therefore, it’s essential to keep testing and monitoring your results.
If you’re unsure where to start, GameBiz Consulting is your perfect partner. Our team of experts has years of experience working with the largest ad networks and can help develop a monetization plan to increase your game’s ad revenue.
We always work on your accounts, and our services are transparent, so you know what we’re doing at all times.
Let us help you increase your game’s ad revenue – it’s what we do best!
