Choosing a monetisation method for your game can be a complex process, especially in today's ever-changing landscape. Developers need to ensure that a steady revenue stream is generated through the game and that they are getting the best value out of their players.
In this guest post, Nexter's head of business development and ad monetisation, Anton Kvashnevskiy, shares valuable insight for developers on maximising ad monetisation in a mobile RPG. Kvashnevskiy highlights unity economics, balancing in-game currency and utilising ad formats such as rewarded videos to enhance player engagement.
At the foundation of any successful mobile game are financial rods of steel. Despite a challenging couple of years, ad monetisation has recently been showing stable growth. But before you set about monetising, you need a good model and a comprehensive understanding of your expected unit economics.
How much will you spend per player? How much will you, therefore, require them to generate? These are just some of the questions you should be asking yourself.
Next up is currency. Think of in-game currency and real-life currency as two sides of the same coin. Your in-game currency must have a permanent exchange rate with real-world currencies. Otherwise, you’ll have an unbalanced game, making it either too difficult or too easy for players, causing them to lose interest.
There are two main types of monetisation when it comes to mobile gaming: in-app purchases and through ads.Anton Kvashnevskiy
There are two main types of monetisation when it comes to mobile gaming: in-app purchases and through ads. The distribution of these depends on the genre and particularities of each game. The former for RPG titles is usually from 50-100 percent, whereas ad monetisation averages between 0-50 percent. There is no set blueprint; some games run solely on ads, like many hypercasual games, while others have none at all. A more casual game will likely rely more heavily on ads, whereas midcore and hardcore games tend to have fewer.
RPGs, rewarded video and offerwalls
Consider mobile ads a monetisation channel not unlike in-app purchases. They couldn’t be more different than the linear ads on TV. Although there are many different types of in-app ads, popular ones for RPG titles are Rewarded Videos and Offerwalls. These don’t interrupt gameplay or annoy players when they’re not needed. Instead, they simply offer another way for players to ‘pay’ for in-game items and power-ups. This makes games more accessible and helps maintain higher levels of audience retention and engagement since not all players can or are willing to pay for in-game items or currency.
This means that players tend to see rewarded videos or Offerwalls as a fair value exchange. They opt to watch an ad or do the offer in return for something valuable within the game, which doesn't disrupt their in-game flow. This helps create a more positive attitude and association with the ads.
Despite the clear benefits to player experience, as developers, you have to strike a balance between monetisation and user satisfaction.Anton Kvashnevskiy
Despite the clear benefits to player experience, as developers, you have to strike a balance between monetisation and user satisfaction. An excessive number of rewarded video ads could still negatively impact the overall experience, and competition offers could drive users away from your game. So careful implementation and consideration of the frequency, rewards offered and offer/exchange rate for Offerwalls are essential to maintaining a positive relationship with your players.
Monetising according to us
At Nexters, we have been developing our in-game ad monetisation for several years and like any good business, we’re constantly improving. The market doesn’t stop still, and neither should you. We use two main types of ad monetisation: rewarded videos and offerwalls. We believe these two placements help us maintain a balance between player ad engagement, game enjoyment and a positive perception of our brand.
Rewarded videos are an ad unit in which players are rewarded for interacting with an ad, symbolising a clear value exchange. Rewards like in-app currency appear at times when they are most needed in terms of the gameplay. These videos benefit not only advertisers by giving them significant exposure to their target markets, but developers also have increased revenue, user engagement and, more importantly - retention.
But just showing these videos is not enough. Diversity and variety are key to ensuring optimal user experience. Repeating advertisements can cause ad blindness, rendering them useless for all involved. Mediation platforms like ironSource, Google AdMob, and AppLovin allow you to manage multiple third-party demand sources from one place. They help ensure that there’s always an appropriate and monetarily valuable ad to show. Publishers can increase their revenue by working with a number of demand sources and managing them optimally.
Offerwalls are in-app advertising units that act like mini-stores with offers within apps. They list multiple ‘offer tasks’ that players can complete in exchange for receiving an in-app reward. Examples of such tasks include level completion, app registration, starting a trial or subscription or taking a survey, for which the player may receive extra in-app currency. They’re also completely user-initiated, meaning that players choose whether or not they want to engage with them. It’s often the case that the advertisements players see are of popular brands they regularly use or purchase. This makes it just another convenient channel but with additional benefits like our in-app currency.
Though all vendors work differently, the interface remains the same across the board. Despite this, it’s important to always compare them. Not so much in terms of which will bring in more value, but which will have more offers so that players have a variety of options. We tested different Offerwalls and saw an increase in cumulative revenue from this ad unit.
Steps to max-out your monetising
1. Experiment, analyse, experiment, analyse, then experiment some more
Conduct A/B testing to see what works best. It may seem obvious, but experimenting with Offerwall currency exchange rates was a relatively new idea that we like to think we pioneered at Nexters.
To maximise the revenue for Hero Wars, we had to increase the Offerwall exchange rate (that’s the ratio between a virtual currency and real-world currency). However, we were concerned that increasing the offerwall rewards and bringing in more traffic to apps advertising in the game might result in a higher churn rate.
As a first step, we analysed our average in-app exchange rates for hard currency and set a similar rate to the Offerwall. This meant that, in the case of any cannibalisation, we wouldn’t disrupt the game economy. We did this separately for Android and iOS due to differences in the number of offers and other factors that affect the exchange rate.
Next, we launched an A/B test with adjusted exchange rates per Tier 1 / Tier 3 markets. Bear in mind that there are so many offers in Tier 1 markets that, as a baseline, player engagement rate is much higher compared to Tier 2/3 markets.
After testing, our Offerwall eCPM increased by 50% and ad revenue from this placement by 40%. This huge improvement led us to use the new exchange rate as the worldwide baseline.
In short, remember: changes are encouraged, but always A/B test them first.
Ad placement alone isn’t enough. To get the most out of them, where you place them is just as important.Anton Kvashnevskiy
2. Make sure you choose the right placement for Ads
As I’ve said already, simply choosing the right type of ad alone isn’t enough. To get the most out of them, where you place them is just as important. Make sure to put them in when players would most benefit from the rewards or when they desperately need resources and can use them immediately. Then, they’ll see them as something useful rather than as something annoying to skip.
We don't force players to watch the ads, they always have a choice. They can watch them while upgrading their heroes. Players also have a limited number of upgrades and can pay with in-game currency or watch the ads.
Rewarded Videos need to be placed exactly at a point when a player needs it: when they run out of in-game soft or hard currency, when they need additional tries or when they need to pump their Hero. Rather than interrupting gameplay, we offer them a booster choice: either bigger with hard currency or slightly smaller for watching rewarded ads. The same goes for the Offewall - make this placement more visible for them so that players clearly see that they have a choice.
Believe me, it will be more beneficial to your revenue and, more importantly, the enjoyment of your players. We saw a 10%+ uplift in player retention once we made Offerwall placement more visible for them.
We have six placements for rewarded videos and two placements for Offerwalls. It was two years before we arrived at the final design, and there’s still room for improvement. The majority of those we test don’t make it in at all, as they don’t have the same effect as existing ones. It’s not easy to find opportunities for growth in this area, and it is still something we’re constantly developing.
3. Lookout for new ad networks and partners
There are lots of advertising networks on the market, and new ones are always appearing. Make sure you check them all out, as they might be profitable and increase the fill rate or create additional competition to the existing ones.
It’s probably a good idea to only keep those networks that are giving you SOV or SOW of more than 1%. However, remember the golden rule - do A/B tests first for any removal or addition of a new ad partner. This may help decrease your latency and decrease the number of ANR's or other errors that might appear after integrating different ad SDK's.
While we’re on the topic, this isn’t sponsored product placement, but have you tried the brand new Moloco SDK? If not, I think it’s worth a try. Thank me later.
4. Address player complaints
ironSource’s AdQuality tool helps ad monetisation managers analyse and check ad experience at user / creative level or publisher level. It really helps us tackle player complaints when the ads are not working properly, or player experience is not as good as it should be. We also check parameters like churn rate, ad escape rates and other UI patterns that help us maximise our revenue without our players having to compromise on user experience.
Make sure that you regularly check your metrics, work closely with your player support team, and disable ads that your players don’t react positively to or that just aren’t working properly.
5. Make sure that ads correlate with your company values:
If an advertisement features on your game, it’s part of it. They’re not separate but interrelated, and users will associate your company with that particular product or service, for better or worse.
Ads for things like cigarettes, alcohol or gambling can indeed generate significant revenue. But they also have the potential to ruin your company’s reputation.
Who is your target audience? Does it correspond with that type of ad? Consider this before featuring any ads on your app. Almost all ad networks allow you to ban or limit specific types of advertising from your app. Yes, it could limit your revenue, but consider how it may affect your brand and player retention in the long run.
Like any product or industry, it doesn’t stand still, so the biggest mistake you can make is not adapting to changes.Anton Kvashnevskiy
6. Constantly update your ads SDKs and check the updates for your app.ads.txt file:
I have no doubt you’ve experienced it, but not updating your ads SDKs and adapters is costly and could mean a loss of up to 10 percent of your revenue per month in the worst cases. The same goes for the app.ads.txt file. We recommend checking for updates across all your ad networks every month. It's fairly quick and easy but can increase your revenue / Impressions between 5-10% due to the addition of new trusted sources.
Long story short, monetising your ads properly is much more difficult than simply putting ads into your app. Like any product or industry, it doesn’t stand still, so the biggest mistake you can make is not adapting to changes. And when you consider a change, don’t forget to test it.
The success of your game will rely not only on solid financial foundations but crucially also on player satisfaction. Your game is nothing without them, so make sure they’re at the centre of your mind when you consider any changes. Will they like it? And vitally, will they want to continue playing?
Thinking about ads beyond the ads themselves will get you well on your way to increased monetisation. But put your players first, and you’ll max out in no time.
Edited by Paige Cook