Although the offerwall is one of the fastest growing ad units in the mobile app ecosystem, some developers are hesitant to add the offerwall into their ad unit monetization strategy - often due to assumptions that are no longer relevant. In this article, we lay out the most common misconceptions we see from developers, and debunk them in order to reveal the true value of this ad unit.
Misconception #1: Offerwalls cannibalize IAPs
By giving users an alternative way to get premium content outside the in-app store, some app developers think offerwalls will demotivate them from making in-app purchases - but in fact data shows that offerwalls have the opposite effect. Let’s remind ourselves of the target audience for offerwalls: users who are highly engaged in the game but prefer to invest their time rather than money to advance further. Despite this preference, by giving these highly engaged, non-paying users a “taste” of premium content, developers can significantly improve their retention, help users progress deeper into the game, and ultimately improve the chances of them becoming paying users.
According to Kongregate, players who engage with the offerwall are 10x to 14x more likely to make an IAP transaction later on. In addition, paying users who engage with offerwalls make more IAPs and have significantly higher average revenue per paying user (ARPPU). For Kongregate, the game category in which offerwalls had the biggest impact was midcore - the amount of IAPs more than doubled among users after completing an offerwall event.
For a more in-depth breakdown, check out our webinar with Kongregate.
Misconception #2: Offerwalls won't significantly improve ad monetization
Some developers believe a combination of user-initiated rewarded video ads and system-initiated ad units, like banners and interstitials, is ample when it comes to ad unit monetization. However, savvy monetization managers understand why offerwalls are not just a luxury or peripheral ad unit, but a central part of any monetization strategy.
Strong demand from advertisers, who are reaping the benefits of the CPE bidding model to acquire high quality users at scale through offerwalls, means the offerwall represents a significant incremental revenue stream for developers. According to ironSource data, the average eCPM for offerwall in the US in 2020 is a whopping $530.
Square Enix - who at first only monetized ads with rewarded videos - doubled their ad revenue for their game, War of the Visions Final Fantasy Brave Exvius, and grew their ARPDAU 5x in the US on Android after adding the offerwall to their monetization strategy. Not only that, they reached a maximum eCPM in the US that was more than twice the benchmark for their game's category.
Misconception #3: Offerwalls negatively impact retention
We’ve heard claims that offerwalls send users to other games and they don’t come back. However, a good offerwall strategy does exactly the opposite. Offerwalls keep users playing the game for longer – instead of quitting once they’re out of resources, users can access the offerwall to get the premium content they need to continue playing. The fact they commit to a time-consuming task reinforces their desire to return to the game and reap the rewards, ultimately increasing retention. Our statistics show that retention among offerwall users is 5-7x higher than non-offerwall users, at the D7, D14, and D30 marks.
The table below, based on data from Kongregate, demonstrates the offerwall's positive impact on retention in two midcore games. From D1 to D90, users who engage with offerwalls have significantly higher retention rates compared to users who do not.
Misconception #4: Users get frustrated by offerwalls’ poor UX and leave your app
Offerwalls in the early years did not offer the best UX and at times users would return to the gameplay frustrated by the experience: advertisers’ events centered around surveys that were full of ads themselves or asked for private information; there was little to no customer support; and there was little thought put into the aesthetic aspect of the experience.
In the last couple years, as ironSource has developed multiple product improvements and the quality of advertisers has increased, the offerwall UX has improved significantly. Rather than driving users out of your, users that convert in the offerwall and engage actually have higher session frequency. According to Tapjoy data, users who engage increase their play frequency by 1.6x.
Let’s look at this in greater detail:
Quality advertisers, quality offers
Some developers still worry that the offers provided by advertisers will be similar to the low quality surveys of the early offerwall days. A quick look at ironSource’s offerwalls dispels this idea - a range of offers are available for users to choose from, like reaching a certain in-game level, unlocking a character, or making an IAP - all from high quality advertisers. This amount of choice is in fact an important reason why the offerwall is such a popular ad unit among users and helps maximize developers’ revenue.
Rich media intermediate pages
Now that advertisers are able to optimize each step of the offerwall user flow in order to maximize conversions for their event, developers can rest assured that their users will go through a positive UX flow, and that they won’t close the offerwall frustrated or disappointed.
The intermediate pages which open once a user clicks on an offer are an example of how far the offerwall UX has come - on these pages, advertisers can add videos, screenshots, and a clear description of the offerwall event. This improves the overall ad experience by ensuring users get a better grasp of the game or app and what’s needed to complete the event. In turn, developers can maximize completion rates and increase retention in their app.
Improved customer support
The earliest versions of offerwalls had little-to-no customer support functions, meaning if the user ran into any bugs - like not receiving their reward after completing an offer - then they would have to get in contact with the developer and/or leave a negative review on the app store.
The ironSource offerwall has a button for users to easily access our internal customer support team for any bugs they experience - this team is also in close communication with developers and advertisers to guarantee a smooth flow for all stakeholders.
Get more insight into the ironSource offerwall in our dedicated eBook. Download it here.