February 13, 2023
How to Effectively Monetize Mobile Games
A Guide to Optimizing Ad Monetization Opportunities
What is Ad Monetization?
Advertising monetization is the process of monetizing an application or website via advertising revenue. This allows a publisher to monetize the traffic that comes through their any application or website without requiring the visitor to pay an entrance fee. The Ad Monetization model is common to most F2P (free to play) mobile games where users can download the app for free and progress in the game without spending any money. On average 80% of all traffic within an application or website do not make a purchase or subscribe when there is a free option available. This is where having an effective ad monetization strategy is crucial to generating revenue in F2P games.
Key Monetization Factors
There are some key factors that can impact the effectiveness of in-game mobile ads. These include:
Ad Types
Ads can be served to players in a variety of ways. The most common formats in Hyper Hippo games are:
Rewarded Ads
Ads that a player chooses to engage in with the purpose of gaining an in-game reward. For example; in AdVenture Capitalist, players are able to double the amount of money generated since the last time they played by watching a 30 second ad.
Interstitial Ads
Ads that players see which occur between certain instances in the game. These ads don’t provide a reward to the player but are required viewing to progress to the next stage of the game. Because interstitial ads are required for game progression, they tend to be much shorter, around 15s.
Examples of rewarded ad placements in AdVenture Capitalist and Vacation Tycoon
Ad Placements
Different types of ads serve different purposes for both monetization and player progression. Some ads are positioned in such a way that a player receives a substantial bonus when activated, thus increasing their ability to progress in the game. We’ve found these to be highly valuable ad placements within Hyper Hippo games, as they provide high engagement rates that drive up our average revenue per daily active user (ARPDAU).
To determine if a placement is successful, we look at three key metrics:
Fill Rate
Represents how many ad units were served out of all the ads requests sent to an ad server. Ad fill rate helps you understand how your inventory is being utilized.
Cost per Thousand Impressions (CPM)
The amount an advertiser pays a website or application per one thousand visitors who see its advertisement. In Ad Monetization, a CPM can be a fixed price or a variable floor which is charged to the advertiser.
Revenue
The direct revenue generated from showing advertising on a website or app.
Tools
At Hyper Hippo, we use Applovin’s MAX tool to help us optimize, track, and scale our ad revenues. Applovin is one example of an app monetization solution that functions as a mediator and allows us to manage and optimize multiple ad networks in one place.
The Golden Rule(s)
There are two key ‘rules’ to follow in ad monetization:
Golden Rule # 1
Make the ad experience valuable for the player. Let’s face it; no one likes to watch ads. Placing ads in awkward places or showing too many ads does not provide the best experience for a player. It’s important to balance the number of ads shown in a session so as to avoid negatively impacting the player experience.
Golden Rule # 2
ABT; Always Be Testing. We are constantly testing new networks, waterfall configurations, and ad placements to maximize the revenue generated from each user session. In the ever changing mobile game landscape, it’s important to constantly explore new and relevant opportunities for in-app monetization.
What does the future look like?
Looking to the future, I’m interested in exploring the possibilities offered by audio ads! There are a number of vendors moving into the marketplace today, and it will be interesting to see how these change the landscape and shake up the traditional ad placements within a mobile game and the possible earning associated.
Keynote: The Sound of Incremental Revenue Why Audio Ads Are What’s Next in Ad Mon,
Check out this video from Pocket Gamer to hear from Amit Monheit, CEO & Co-founder at Odeeo and Ryan Rummery, Commercial Director from DAX Global about why Audio Ads are what’s next in Ad Mon.
Conclusion
My experience working in ad monetization has taught me that showing a single ad in a game session is dependent on multiple, complex processes taking place behind the scenes. When it comes down to it, ad monetization is a collaborative effort: advertisers are seeking a variety of different ways to reach their target audience at the right time and in the right place, and mobile game publishers are seeking to effectively monetize their products Ad Monetization provides a valuable service within this ecosystem to show relevant advertising to players, connect advertisers with target audiences, and drive publishers’ revenue.
With ever-changing advertising privacy policies and regulations, this both closes and opens up opportunities for Ad Monetization Managers to better understand the types of ads shown in their games, and to look for ways to show more valuable inventory to players and improve the user experience.
Interested in working with us at Hyper Hippo? Check out our open roles here, or join our talent pipeline to be notified when we’re hiring for a role that aligns with your expertise!
Wesley Favro is UA and Ad Monetization Manager at Hyper Hippo Entertainment. Wes has eight years experience working in digital advertising, content marketing, SEO Management, influencer management and app monetization. Wesley holds a BBA with Honours from the Okanagan School of Business.