Terry Angelos is the co-founder and president of TrialPay, a leading cross-platform monetisation company.

Audiences are no longer tethered to their sofas, watching live TV and its associated advertising content.

Instead, they watch on-demand programming, skip TV ads, and increasingly swap large-screen entertainment for games and curated content on mobile devices.

These trends have prompted advertisers to engage audiences in new ways that complement how people now consume digital entertainment.

US ad spending for mobile video is set to quadruple from $518 million in 2013 to an estimated $2.1 billion in 2016. As mobile reaches scale, publishers and platforms attract diverse audiences that will allow advertisers to reach large audiences more efficiently.

For example, Zynga's Texas Hold 'Em has 1 million daily active users, and platforms such as Facebook report 78 percent of users are now mobile.

Rise of Reward video

One of the most popular advertising formats for gaming audiences is a value-exchange model where consumers opt-in to see offers or messages in exchange for in-game rewards.

Consumer choice is critical to create value for advertisers; a point that is underscored by Google extending its popular TrueView format to games.

Pandora, which recently announced a 92 percent increase in Q2 mobile ad-revenue, is also experimenting with reward formats where consumers extend their free listening hours in exchange for watching an ad.

TrialPay's own data on reward video from our network of over 300 million consumers, shows double digit growth in mobile video minutes played (delivering over 100 million minutes of video annually), and consistently high consumer engagement levels that make it worthwhile for advertisers to spend in this channel.

Broad approach

So how do developers take advantage of these growing advertising budgets?

First, budgets are critical to sustain fill-rates. No single ad-agency, or video network, can provide enough high-quality video on a cost-per-view basis to sustain consumers in most games. So it's important to deploy a mediation layer or open ad-server to capture budgets from multiple video partners.

Once you have a number of video partners in place, developers need to queue and optimize these various video streams, ideally taking into account variations in pricing and click-through rates to maximise your payouts from these placements.

At TrialPay, we integrate with over 30 ad agencies and video networks who provide budgets at a wide range of price points. It's important that integrations with these providers can load video via a real-time API so that developers can switch between multiple sources depending on geography, audience type and pricing.

With some optimization, eCPM rates improve by double digits in our experiments with partners.

Placement is also an important consideration. Developers can reward users either with currency, or with virtual items, depending on the desired outcome.

As an opt-in video can be launched at specific points in a game (i.e. between levels, or when a user is out of energy or lives), the ability to deliver specifically what users want will only serve to increase engagement.

What works?

Tune-in campaigns for TV shows are popular and successful campaigns. Advertisers drive consumers to watch a new series or remind them to tune-in to existing programming.

In a recent campaign, TrialPay delivered 1 million opt-in views to advertisers (yielding $100,000 to developers). More importantly, 15 percent of these videos resulted in non-incentive actions such as liking the campaign on Facebook.

Financial services companies spent $750 million on online advertising in 2012. TrialPay recently worked with an insurance company to deliver a campaign that reached almost 400,000 views.

The ads were effectively targeted to the right customers, as was indicated by the fact that 97 percent of clicks resulted in a completed view, and 30 percent of the completed views clicked through to their website after watching.

Takeaways

As more content goes mobile, and mobile advertising budgets increase, audiences demand content to go, and want to be entertained by a holistic experience.

Interrupting - or distracting from - gameplay with static ads will only serve to drive customers away. Video is key in delivering advertising messages while simultaneously keeping users engaged with a game.