Guest post written by Samuel Huber, CEO at Admix.
2020 will surely be remembered as a crazy year by everyone, not least by game developers and publishers... and advertisers.
On one hand, the market is hotter than ever: people have been spending 20 per cent more time playing games under lockdown, dropping an impressive $50 billion in in-app purchases over the first six months of the year, and the gaming investment activity has grown an incredible 77 per cent quarter-to-quarter with no signs of stopping.
On the other hand, with Apple introducing iOS14, the industry is on shaky grounds. iOS14 brings the death of the IDFA (Identifier for Advertiser for iOS devices) which is used to track attribution for performance ads across the app ecosystem.
Interstitials ads - these 30 seconds full-screen takeover video ads promoting other games, represent a vast majority of publishers’ revenues. Without this identifier, running performance campaigns become more difficult because the users cannot be identified across apps, so the CPMs are expected to go down, reducing the publisher’s ad revenue.
Faced with this uncertainty, publishers have had to react to mitigate the problem. One solution is in-play ads. In-play ads are similar to product placements - posters, videos integrated natively within the gameplay.
Staying in the game
Lately, major brands have prospered by the growth of gaming to engage their audience in-play, from MasterCard in League of Legends to Burger King in Fifa 2020. While this is not a new concept, the increased appetite for brands to be involved with gaming is why these advertising solutions have skyrocketed.
Since brand advertising is assessed on different KPIs than performance (such as audience targeting and viewability), the lack of IDFA does not affect it as much, and brands are keen to capitalise on the growth of gaming as a new channel. For the publishers, the benefits are twofold.
First, in-play ads can be integrated in addition to the traditional monetisation stack as it targets different moments in the games. So the revenue is purely incremental.
HGamesArts, an Eastern European studio with 250 million downloads, reports a 31 per cent ARPDAU increase (Average Revenue per Daily Active Users) from in-play solution Admix. In-play now represents 25 per cent of their global revenue - against a full interstitials mediation stack.
Similarly, Russia-based publisher Naxeex (500 million downloads) also ranks Admix in-play revenue right behind interstitials and rewarded ads revenue, growing 20 per cent month-on-month on average this year. This extra revenue stream mitigates eventual performance CPM drop.
Second, because they do not interrupt the gameplay, in-play ads do not affect user retention, which creates an infinitely scalable model.
This is the reason why developer Wolves Interactive wanted an in-play solution for their racing game Traffic Tour (more than 10 million downloads), where interrupting the experience is particularly unpleasant to the player.
After going live, the studio saw instant revenue uplift from in-play and now has a healthy diversity in ad revenue.
“The fact that in-play is immune to the upcoming changes in iOS 14 was a big factor in prioritising this integration”, said Marawan Hassan, CMO, Wolves Interactive.
No-code, no problem
In-play doesn’t only work for large open worlds though. Idle game publisher AppQuantum - the developer behind Idle city and Idle clicker - also integrated in-play in a few days, for the same reasons.
“The no-code nature of the integration makes it a no-brainer to at least try”, said Elena Bugakova, Publishing Producer, AppQuantum.
Lastly, in-play ads in a format that finally makes sense for brands to jump into gaming, as opposed to 30 seconds interstitials which are optimised for performance.
Placing a logo alongside a football game or a racing track creates a positive experience that consumers are more likely to remember than a traditional display ad on a website.
Scalable solutions such as that provided by Admix are emerging to enable these brands to target their audience in-play at scale, which will unlock more brand revenue for developers.
All these ingredients are making in-play a good antidote for a post iOS14 world, ensuring a healthy mobile gaming ecosystem for both consumers and developers.