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How Glu Mobile balances UA spend and in-game advertising revenue

How Glu Mobile balances UA spend and in-game advertising revenue

The increasing cost of traditional CPI marketing is a constant issue for all mobile game marketeers.

And, if you flip the switch, the rise cost of mobile advertising is good news for companies who have a lot of inventory to sell.

And as Glu Mobile demonstrates, the ability to be able to modify your UA campaigns in terms of how much you're generating from running other companies' ads in your games is the real sweetspot.

In control

In its most recent financials, Glu broke out some figures which clearly shows this in action.

Over the past six quarters (18 months), it's balanced its UA spending (shown in blue) with the revenue it's generated (red).

In this way, in periods when advertising is more expensive - such as the Holiday period (Q4) - it generates more cash and spends less on expensive UA.

Over the past six month, though, when UA is relatively cheaper, Glu's been spending more on UA.

Accentuate the positive

The other thing to point out is Glu now has the ability to generate tens of millions of dollars annual from advertising.

During FY14, it made almost $40 million from ads, and it's looking to spend less on UA in future by making games with celebrities like Kay Perry, Kim Kardashian and Britney Spears who have a lot of direct reach on social networks.

Glu is aggressive in driving players to watch incentivised video ads

Of course, Glu isn't the biggest beast in the space. Zynga is in a stronger position.

During its past quarter, it generated $38 million from in-game advertising, although it didn't break out how much it was spending on UA.

And King has the largest gaming network, although it doesn't formally break out its UA or advertising numbers.

And on the other side of the equation, Korean publisher Com2uS announced it had spent $18 million in its most recent quarter on marketing, up from $15 million three months ago.

Contributing Editor

A Pocket Gamer co-founder, Jon is Contributing Editor at PG.biz which means he acts like a slightly confused uncle who's forgotten where he's left his glasses. As well as letters and cameras, he likes imaginary numbers and legumes.

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