The most successful apps in mobile are free. However, to launch future apps, and keep the proverbial doors open, you need revenue. That’s where monetization comes in.
In 2015, opening your app to brand dollars through programmatic advertising is one of the best ways to make the dollars flow, and (most importantly) not totally irritate users.
Monetization was a common theme of my talk today at PG Connects in London. For those of you who can’t join me in person, I’m sharing a few takeaways here on monetization trends to be aware of this year (feel free to take a look at the slides, too!):
1 – For publishers, there’s no problem with programmatic.
Traditionally in games, the biggest advertisers have been other games. Now, brand advertisers are shifting their budgets to mobile in an effort to go where the people are. After all, people are tuning out of non-traditional media, and tuning into smartphones and tablets in record numbers. (34% of advertisers say they plan to move money away from TV advertising to mobile this year.)
For publishers, monetization is directly affected by how the advertisers buy advertising and where they spend their dollars. A huge spike in programmatic buying (when brands work with demand-side platforms or private ad exchange) offers brands a highly efficient way to control spend. The good news for pubs is, brands will pay higher eCPMs for access to mobile video inventory, especially if it’s highly targeted premium content. Which brings me to…
2 – Private marketplaces will heat up.
Private marketplaces – where brand buyers can selectively purchase premium inventory from publishers – are a natural extension of the programmatic universe.
Imagine if you head to the mall, looking for some socks. You’ve gone there for something very specific. When a brand buys inventory through a private marketplace, your app is the sock store, and they’re paying for the opportunity to send a very specific message to your sock-loving self.
Private marketplaces give brand buyers a way to programmatically purchase space in the sock store, i.e. tagged blocks of inventory from publishers, without having to maintain one-to-one relationships. For the publisher, this means greater brand access to your inventory, higher returns and brand-quality ad placements that appeal to users.
3 – Mobile Video Ads Will Finally Kill the Display Star.
When I worked for Rovio in 2010, banner ads used to be the only game in town. Even now, we still see games launching, taking off, and reverting to banner ads, or the next worst thing, static interstitials which completely break the user’s game flow.
Now, the game has changed. Rovio today has opt-in mobile video ad placements that reward users for watching an ad with an extra life or other bonus incentives (like melting your characters out of carbonite in Angry Birds Star Wars). This way, rather than a blatant money-maker, ads feel more like a feature of a game that puts the ad experience into the user’s hands.
It’s reasons like this, as well as high returns, that have mobile video ads taking center stage this year. According to eMarketer, mobile video ad revenue is projected to reach more than $6 billion by 2018.
Monetization: An Always-Changing Game
No one wants to include ads in their games, but it’s a way to keep providing the game at no cost to the users who love what you’ve created. Changing trends in buying and the rise of mobile video ads only make it more lucrative for you and less painful for your users. Staying on top of these, and getting educated on programmatic ad exchange, are smart moves in monetization this year.