How to Win With In-Game Advertising

Are gaming studios missing out on a strong and fruitful opportunity to utilize video ads and increase revenue?

With the rise of freemium games, studios have had to get creative in order to turn a profit and continue to produce high-quality gaming content. In-game ads have become prolific, with regular gamers having acclimated to brief interruptions with stagnant visual ads. This begs the question: are gaming studios missing out on a strong and fruitful opportunity to utilize video ads and increase revenue?

Gamers are an ideal demographic for advertising. Not only are they more engaged with content, they’re also receptive to it. Many view watching an ad as an implicit form of payment for the gaming content. This understanding means that gamers are often willing, even happy, to spend time interacting with an advertisement.

Beyond the players themselves, the gaming format seamlessly blends video into gaming environment. Games typically have natural “cliffhanger” moments for ads to run, and the video format is the perfect fit for in-game content.

In-game video ads clearly represent a large opportunity for developers, but where should you begin? There are many techniques you can use to maximize the effectiveness of your video ads and minimize the advertising fatigue of your users. Here are the most successful types of in-game ads and some general best practices.

Selective Ads

Interactive ads where the viewer is allowed to choose from a selection of ads tend to outperform traditional pre-roll ads, with click-through rates (CTR) higher than pre-roll. Outside of an increased CTR, this practice also helps the ads reach an audience that is interested in the product.

Incentivized Ads

Ads where users watch a video in exchange for some in-game value not only return the highest CPM (cost per impression), they also elicit positive feelings in gamers. Incentivized Ads have an average CTR of 11 percent, over 100x higher than the CTR of standard banner advertising campaigns. Incentivized advertising is a very effective way to engage your users. Not only do incentivized ads elicit positive feelings from gamers, they also perform significantly higher when it comes to CTR and advertising revenue earned.

Pre-Game, Mid-Game, Post-Game

Ads should be incorporated into the game and not around the border like more traditional ads. This is not only because most gamers are player on a smaller, mobile screen, but also because incorporating the ad into the center or whole screen increase success. Social and mobile gaming video ads have an average CTR of 3 percent, 30x higher than the CTR of standard banner advertising campaigns.

Ad Gating

Ad-gating is a commonly used practice where a player must watch an ad before continuing in the game. This ensures 100% completion of ads and is frequently preferred by gamers because it allows for just a quick break before they can continue with their gameplay.

This is not an exhaustive list of the many ways you can incorporate video into games, they also don’t have to be used individually, with many of the types easily incorporating into each other. There is no right answer for every gaming company, but you should always be asking the right questions. Finding a flexible solution is the key to advertising monetization success.

Brian Rifkin is the co-founder of JW Player

Image courtesy of Shutterstock.