In-game advertising on the up: report

94 per cent of Free-to-Play (F2P) games now feature some form of in-game advertising (up from 87 per cent in 2018), while the number of developers making more than 40 per cent of their revenue from ads has increased by 21 per cent over last year.

These are two of the key findings from game analytics and player management firm deltaDNA’s fifth annual In-Game Advertising Study.  The report, which is based on the experiences and opinions of hundreds of game developers, suggests that the ‘cautious’ and ‘experimental’ phase of in-game advertising could be coming to an end, with the number of game makers feeling ‘confident’ about their approach to ads up 60 per cent in just 12 months.

Developers are becoming increasingly competent when it comes to balancing ads and In-app Purchases (IAP) in a way that preserves the player experience. As a result, 30 per cent of developers are now showing five or more ads per session (compared to just 20 per cent in 2018) while the number of developers choosing not to show any ads has fallen by almost a third to just 10 per cent.

This confidence also extends to ad formats, with 68 per cent now using more than one ad format within their games (up from 56 per cent in 2018), while 33 per cent use three or more different types of advertising, a rise from 20 per cent the previous year.

But it’s not just casual games where ads are flourishing. The number of core games generating more than 80 per cent of their revenue from ads has increased by 7 per cent in twelve months, as developers becoming increasingly convinced of the legitimacy of ads as a vital revenue stream.

The study also found that rewarded video ads are now deployed within 82 per cent of games (up from 65 per cent last year), ahead of interstitial video ads (57 per cent) and banners (34 per cent). Playable ads are now used in 19 per cent of games, down from 21 per cent last year.

The number of respondents who identify in-game ads as an ‘important monetization opportunity’ has grown from 59 per cent in 2018 to 64 per cent in 2019, while only 15 per cent believe ads scare off potential payers.

When it comes to setting the frequency of ads in a game, the most common concerns among developers are increased player churn (30 per cent), lower levels of player enjoyment (27 per cent) and impact on IAP revenue (16 per cent).

28 per cent of developers don’t evaluate the return they get from UA spend, while the most common form of evaluation (31 per cent) is to compare the CPI from UA campaigns.

“In the five years that we’ve been running this study, we’ve seen attitudes towards in-game advertising evolve significantly, to the point where ads now feature in almost all casual games and increasingly in core games,” said deltaDNA general manager, Mark Robinson. ““By using analytics and A/B testing, game developers have been able to move beyond the retention concern of previous years by integrating in-game advertising as a key part of the player experience. This has given developers the confidence to use a wider range of ad formats and show more ads per session, which is why the number of games making the majority of revenue from ads continues to grow.”
You can download the full report here.