Monetizing free-to-play mobile games has always been challenging for game developers. The most common advertising options, in-app purchases, and in-game advertising can disrupt gameplay and lead to players leaving a game if they are not done right. Striking a balance between profitability (monetization) and providing a great player experience is therefore crucial. Because many players will never complete an in-app challenge, in-game advertising remains the more viable option for monetization. But how can developers ensure they provide a great experience while remaining profitable? Are in-game ads even a good option?
Everyone responds to ads differently. In many cases, ads annoy players leading to them leaving the game. Developers can use data to determine how individual players respond to ads. They can then come up with data-driven approaches to serving ads that are aligned with the needs and behaviors of individual players. Doing so helps cater to players who have varying tolerances to ads, ensuring that everyone is happy and reducing player churn.
Tasteful ads served at the right time could be great for developers. Players do not want to see ads when they lose the game or fail a level. Doing so will annoy some players leading to churn. The best time to serve an ad is when players are not in a heightened negative emotional state. The emotional state of the player affects retention and also the chances of them clicking an ad or going through to an installation page. The result is a direct effect on a company’s revenue depending on when they serve the ads.
Many game developers already know the effect ads have on retention and players taking the required actions. They become too cautious and decide to serve ads deeper inside the player lifecycle. Many developers think this pleases players, and it does for many, but it leads to low revenue. Why? Many games have low retention rates and thus serving ads too late means missing out on players who may have moved on from the game. These players never see the ads and developers miss out on that revenue.
By striking the right balance, developers can show players ads at the right time, especially if the ad is a call to make a purchase. Many games show ads within the first 10 minutes meaning they capture players before they turn away from the game.
Another way ads can be great for developers is when they are used to aid in the discoverability of games or content players will love. The game already attracts players who have particular interests, and ads that cater to those interests are more likely to be clicked on. When developing a casino game, for example, developers need to show ads that are related to this niche. They could show ads for real money online casinos if this is something players are interested in. They could also highlight other benefits so that players feel they are getting some value by clicking on an ad in the game.
When done right, ads can be a significant source of revenue for a game developer. Developers have to think carefully about the ads they add to their games to ensure they are enhancing and not negatively impacting player experiences.
However, using product placement in video games is also an option.