The mobile games sector has seen remarkable changes over the past few years, with the pandemic causing an unprecedented (and unsustainable) boom, then a normalising market being compounded by global economic unrest, regulatory changes, and geopolitical issues such as the ongoing war in Ukraine. This resulted in 2022 being the first year where the industry declined.
However, 2022 did see a number of notable successes, whether through companies that saw minimal losses or games which quickly generated revenue or racked up downloads.
We spoke to Hector Almeida, general manager of the EMEA (Europe, the Middle East, and Africa) region at mobile advertising platform Mintegral, about the state of the industry, and how mobile game makers can thrive even in times of economic uncertainty.
Pocketgamer.biz: What are the biggest challenges facing mobile game advertisers in the current market, and what can game makers do to overcome them?
Hector Almeida: The biggest challenge for mobile game advertisers is the growing competition in the market. With so many new titles being released every day, it's important for developers to set their game apart by understanding their target audience and offering a unique value proposition. This can be done by making games that are both engaging and enjoyable to play and by having a clear plan for monetisation.
Working with top ad networks, like Mintegral, that can deliver both high-volume and high-quality users is also key to reaching the target audience and being successful. If you miss out on working with one of the top ad networks, you may be at a disadvantage compared to your competitors.
Some genres have managed to deal with recent changes to regulation far better than others, both in terms of downloads and revenue. What do you think are the biggest factors to their success?
Mobile game developers have faced a number of challenges in recent years as a result of changing regulations. For example, new regulations in China and ad tracking limitations imposed by Apple have affected the industry, both in terms of downloads and revenue. To overcome these challenges, it's crucial for developers to stay up-to-date with the latest regulations and adapt their strategies accordingly. This may involve investing in innovative marketing techniques that reach their target audience effectively, having a clear understanding of their target audience, and offering a unique value proposition that sets their game apart from others.
Additionally, collaborating with top ad networks that have the capability to deliver both high-volume and high-quality users can help developers reach their target audience and achieve success, even in the face of regulatory challenges.
What can mobile game makers do to safeguard themselves from shifts in consumer spending after a pandemic, or in a recession?
By diversifying their monetisation strategies. One way to do this is by incorporating ad monetisation into their games, as this allows them to earn revenue from multiple sources and reduces their dependence on a single monetisation model. This can help to mitigate the risk associated with shifts in consumer spending.
Another effective strategy is to add in-app purchases as a monetisation option, as this can provide an additional source of revenue and give players more flexibility in how they choose to support the game. By offering a range of monetisation options, mobile game developers can better protect themselves from changes in consumer spending, even during times of economic uncertainty.
Through successes such as HBO’s The Last of Us, games are only growing in cultural credibility. How do you think games can grow further?
Games can grow further by continuing to push the limits of what is possible. This could be through trying out new ways of telling stories or incorporating new technologies such as virtual and augmented reality.
I am convinced that games are a form of art, combining elements like graphics, characters, worlds, soundtracks, sound effects, and more to create a unique experience. These elements along with the concept, story, controls, and code come together to form a masterpiece. Just like an opera with music, actors, costumes, and settings, game developers have the opportunity to express themselves, and transmit different emotions to players.
Traditionally console and PC have got all the credit as furthering games as an art form. Do you think mobile games can (or is) achieving similar status?
Yes, mobile games are definitely achieving similar status. The advancement of mobile technology has allowed for more complex and sophisticated games to be developed for the platform, and many mobile games are now being recognised as works of art in their own right. Additionally, the accessibility of mobile games has allowed a wider audience to experience and appreciate the art form.
What can ad makers do to work alongside game makers and ensure that their games (and ads) reach the largest possible audience?
Ad networks can work alongside game developers by starting with a broad targeting strategy and utilising advanced algorithms to accurately identify the target audience. By offering a variety of ad creatives in different sizes and formats, including playable ad creatives, ad networks can improve the chances of reaching the target audience. Ad networks can also provide tools like PlayTurbo to make it easier for game developers to create and A/B test their own ad creatives.
It's important to constantly generate new sets of creatives and test different elements, such as colour, buttons, and gameplay. Ad networks like Mintegral can automate this process by automatically A/B testing all new creatives and sending more traffic to the most successful ones, reducing the need for manual optimization.
Ultimately, the goal should be to reach the largest possible audience, but it is crucial to ensure that the audience reached is the target audience in order to achieve the desired goals.
What are your predictions on how the advertising space will evolve over the next five years?
Well, in the next five years, I think mobile advertising for mobile games will go through some changes.
As technology advances, so will advertising. I think the metaverse will bring in new opportunities, not just VR but play-to-earn and virtual services. With faster internet connections advertisers will be able to deliver more engaging and data-rich ads that include features such as high-definition video and interactive elements. These capabilities allow advertisers to create more personalized and impactful ads that can effectively increase the target audience engagement.
With privacy being a hot topic and with an increase in regulations, I think AI and machine learning will have to get creative to target users without compromising their personal data. And who knows, if we were to face a recession, most likely people's spending habits might change, and gaming revenue streams could become more dependent on ad monetization to guarantee a steady stream of income from users who might not be able to spend money on virtual goods anymore.