How advertising has found its way into video games
Since the advent of smartphones, a market has taken off: that of apps, or mobile applications, that users download, install on their phone and use for all kinds of uses. In the huge galaxy of apps, games represent a non-negligible part. But how did advertising found its way into the world of the video games?
We will be interested in these lines to so called ad based games, that is to say, free-to-play mobile games (free to download) whose revenues are generated by the diffusion of advertisements. One question is of particular interest to us: how do these games generate revenue by taking into account two constraints: on the one hand, mobile use, which implies that the connection of the device is not always optimal for broadcasting an advertisement; on the other hand, the possible publicity of the users, which implies that the advertising revenues are not always excellent.
The economic model of these games is as follows: the publisher of the application offers the game to download. Within the game, it integrates advertisements for other applications, through an advertising agency (usually third), which retains a share of the revenue generated. The rest of the revenue is shared between the application platform (Google Play or Apple Store depending on the operating system of the phone) and the publisher of the application.
Among these mobile advertising agencies, there are companies such as Vungle, TapJoy, Google AdMob, AdColony … Most of these advertising agencies require the integration of a specific SDK — development kit — within the application. This SDK then broadcasts advertisements according to an algorithm defined by the advertising agency.
According to some sources, this algorithm will be more or less relevant and will offer advertisements more or less adapted to the user of the phone and this according to the data to which the user has given access authorization by downloading the game. Important element is that the relevance of advertisements will depend on their effectiveness. This is determined according to two main KPIs: on the one hand the number of views on advertising, but also and especially the conversion rate, ie the number of people who downloaded the sponsored application after being faced with advertising.
There are at least three broad categories of advertising displays in mobile video games, each of which has its advantages and disadvantages: Display (or banner): This is a banner covering part of the game screen, usually located at the top or bottom of the game interface. This can be fixed or changing (different ads are scrolling at regular intervals). The problem with this type of mobile advertising is that it tarnishes the gaming experience — the banner is constantly visible — and can therefore hinder the user’s experience, which is not necessarily going to be clicked on. On the other hand, the banner guarantees a fairly high rate of view, and has the advantage of not being too greedy in data: an essential point during a mobile use, since all the mobile connections are not equal, and that all packages do not allow unlimited use of the data.
Interstitial: This is an image or a video in full screen that interrupts the course of the game. It is usually displayed and “non-skippable” (the user can not close it) during a number of seconds fixed. The advantage, again, is that the interstitial provides good visibility because of its appearance in full screen; the disadvantage is that the conversion rate may again be bad, because of the intrusiveness of the advertisement.
Rewarded: less intrusive, the rewarded ad is an advertisement that the user chooses himself to trigger. Indeed, the game can offer the player a reward (extra life, virtual money, etc.) in exchange for watching an advertisement. This type of advertising is therefore generally better accepted by the user and ensures a better conversion rate (users have, according to a study of 2017, up to a 23% chance of downloading a sponsored application in the case a rewarded video). On the other hand, to the extent that it is subject to the consent of the user, this advertisement has a lower visibility rate because a large proportion of users will simply avoid it. Finally, rewarded ads are usually videos, they often require a connection greedy mobile data, so they are, most of the time, triggered only in case the device is connected in wifi.
As the world of mobile games is expanding rapidly and more and more people are starting to paly video games in general, advertising on mobile games needs to be implemented in brand advertising strategy. Aslo we live in a society that is fast paced, meaning people will be on their phones when they travel and when they are outside and to kill time they will in most of the cases play some video games, and there brands need to take action in context of advertising in video games.
