Direct Advertising Trades Emerge as a New Way of Getting Users as Chartboost, TinyCo Partner

One of the interesting marketing trends I’ve heard more about in recent months is how mobile game developers are doing direct advertising trades to avoid giving up revenue share to an ad network and to bypass platform restrictions around cross-promotion.

In that vein, a partnership today between San Francisco’s Chartboost and Andreessen Horowitz-backed TinyCo shouldn’t be much of a surprise. The pair are giving developers who display ads promoting TinyCo games 100 percent of the proceeds, instead of partial revenue share as many ad networks might ask for.

The deal will help TinyCo get additional users as smaller independent studios advertise their games like Tiny Zoo Friends in their apps. At the same time, Chartboost, which is still a very young mobile monetization and advertising company, will get to grow its network of game developers.

Chartboost is trying to build a platform where developers can reach out to each other directly and trade advertising inventory to cross-promote their apps. It was founded by two alums of Tapulous, the early gaming company Disney acquired last summer, and recently raised $2 million in a first venture round of funding from TransLink Capital, South Korea’s SK Telecom Ventures and XG Ventures.

TinyCo, like the other mid-size mobile gaming companies, is trying to find new ways of cheaply acquiring customers. After developers lost the ability to do incentivized installs on iOS, where users can download their apps in exchange for virtual rewards, they’ve been hunting for new marketing channels as user acquisition costs have gone up. At a panel I moderated last month at the Game Developers’ Conference in Austin last month, the bigger mobile gaming companies including Storm8, Pocket Gems, TinyCo and Funzio said they were looking at direct advertising trades as a way of getting new users.

Jennifer Lu, who handles business development for TinyCo, said the company had been doing direct advertising trades for some time, but that the company found it cumbersome to manage the deals.

“These deals performed really well but were extremely time consuming to arrange and hard to track,” she said. “Now that Chartboost has made it easy for us to set up deals with other publishers and transparently track clicks and installs it’s becoming a significant user acquisition channel for us.”

She didn’t share specific numbers on the share of users TinyCo has been able to attract through this method.