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The fundamentals of rewarded video ad placements
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Rewarded videos are a must-have ad unit for mobile game developers who are serious about increasing revenue and providing a great user experience. This combination might sound too good to be true, but when implemented smartly, rewarded videos can make the magic happen - becoming important parts of a mobile game’s core loop. 

For users, rewarded videos grant access to rewards that offer in-game currency or progression boosts. Because these ads are not forced upon the user - they decide to interact with the ad or not - the user experience is positive. 

For game developers, rewarded videos can be a significant revenue stream that has a positive knock-on effect: by enabling users to progress faster and enjoy premium content for free, they increase retention rates - keeping users in the game for longer and maximizing their LTV. 

But achieving all of this requires a well-thought out strategy. Below, we share insights from Anna Popereko of ironSource's game design consultancy service, which provides in-depth game analysis to help developers improve their game design and ad placements. Keep reading to learn the fundamentals of a winning rewarded video strategy and best practices from Anna.

Think about rewarded videos early 

Every mobile game has a place for ad implementation, whether it’s a complex RPG or a trendy hyper-casual game. As a developer, think about implementing ad placements in your game as early as possible. 

This will help you make rewarded videos feel like a natural part of your gameplay, and as a result create a great placement strategy and user experience. If you only start thinking about adding ads at a later stage, it might be harder to find natural, high value placements. Having said that, even if you published a game, it’s never too late to improve it with rewarded video.

Treat rewarded videos as a part of your game economy

Let’s say you’ve done some thinking about your game economy, and you’ve calculated the game’s economic balance - how do rewarded video ads fit in?

Firstly, include your rewarded video calculations in the economy. For example, when checking the maximum amount of coins a player can get by level 20, include the rewarded video in the calculation as if the player has watched them all. This will help you balance the game and not cannibalize the economy. If you underestimate the amount of coins a player can earn through rewarded videos, and they end up exceeding your estimations, it could make your IAPs redundant and give players too much power in the game - making it too easy for them to progress. 

Secondly, the value of your rewarded video ads’ rewards should be connected to your game’s economy, not to your average eCPM - a rookie error. eCPM is a value that changes often, whereas the game economy is consistent and remains with players all the time.

The rewards need to be valuable for the player, to encourage them to watch the ad to get it. Make sure that the player is getting enough resources to help them progress in the game, but not enough to cannibalize the economy. You don’t want to make your in-app purchase offers redundant because that could damage your overall revenue.

Try a variation of rewards and placements

The first thing you need to do when building a strategy for your rewarded video placements is understand your players and what motivates them. Not just in general, but also at specific points throughout your game. For instance, if most of your players are motivated by the ability to dominate in the game, and they are lacking resources at certain points to defeat enemies quickly, you could offer them extra resources in return for watching the ad.  

Here’s a few other ideas of what to offer players:

A taste of premium features

Giving users a taste of premium features that are usually only available as in-app purchases can be an effective way to encourage them to eventually spend real money, once the player recognizes the value of the reward. 

This taste could be a small part of what's included in your subscription offer, for instance, or something valuable that users can only unlock through buying an IAP or watching the ad.

In the example below from War Robots, the reward for watching an ad is a day’s worth of premium features that paying subscribers receive. Don’t be afraid to really emphasize the reward - War Robots lists out exactly what users will get and repeats “premium” twice to show it’s a special offer. 

To unlock this reward in War Robots, users must watch 2 videos in a row - which helps reinforce the feeling that this is a really meaningful and valuable offer.  

To maximize engagement for premium feature offers, try making them time sensitive as users won’t want to miss out. War Robots used a 1 hour timer in the example, but you can test even shorter timeframes. 

Progression-based rewards to extend the player's session

Aside from offering a taste of premium features, you can also offer rewards that enable the player to extend their session. Perhaps users ran out of lives and were about to leave, or don’t have in-game energy to overcome the next obstacle - rewarded video is a beautiful chance to extend the play session by offering something that is needed to continue progressing in that moment. That’s what Evermerge did in the example below - offering users energy to keep progressing, either by purchasing it with in-game currency or for free, in return for watching an ad. 

Understand what resources are typically needed to progress at certain levels or points in the game, and use this information to implement your rewarded video placement smartly. This is all about your game economy - make calculations of the amount of currency you expect players to have at specific milestones in the game, such as every level, merge, or fight. When planning your economy, try making some resources abundant and some scarce.

Zero City, shown below, is another good example. At any point in the game, users can watch a rewarded video to replenish any resource they’re lacking. Whether it's potion, food, or money, the game lets them choose which resource to replenish. The reward offered increases according to the level the player is in - the higher the level, the more valuable the reward. 

Give the player a surprise reward

Surprise boxes are a rewarded video placement we see a lot of developers using, that give the player a random reward, from coins to power-ups and lives. This tactic can drive strong engagement among users; increasing revenue and also retention, as players come back for more surprises. You can promote such offers at different points in the game, such as the homescreen, in the in-game store, or once a user completes a level. 

Hustle Castle uses a chest system smartly, offering several chests in its “treasures” section that players can open for free, by spending in-game currency, or by watching an ad. By including one for free, the game gives its players a taste of the reward and shows them how valuable it is. This encourages players to return to the “treasures” section and unlock more valuable resources that they’re lacking in the game - which is when the rewarded video offer will come in handy. Note how the traffic driver on the rewarded video is orange, standing out from the other traffic drivers and drawing attention to the offer.

Optimize your buttons

Traffic drivers are the buttons users will tap to open up your rewarded video ads. Typically, this will consist of two parts: a “watch now” button and another button that shows the value of the reward. You should make sure both are optimized in order to maximize engagement and usage of your offers. Here’s a few tips:

Distinctive

 Rewarded video buttons should look different from the other buttons in the game because they give different experiences to the player. So make sure they stand out - in color, shape, position, and text. Subway Surfers did that well in the example below - the purple color and TV graphic make the offer visible and eye-catching.

Clear value proposition 

The player needs to know what reward they’re getting for watching a video. So make sure you clearly show what kind of resource they’re getting (a gem, a cold coin, virtual dollars, etc) and how much of it. In Grand Hotel Mania, the traffic driver clearly states “double your income” - there’s no second guessing about what the reward will be. 

Accessible

It’s also important to keep your traffic drivers right in front of the player’s eyes in the most popular screens of the game. As with any other game feature, the more a player needs to tap to reach the ad, the easier it is for them to churn. Make sure that all it takes is one tap from the user to open the ad and begin watching it - remove any extra taps and friction where possible. Remember that the more the player is exposed to the placements, the greater the chances of them opening the ad. In Home & Garden, shown below, the game keeps showing the option to watch a rewarded video in case players missed it in the end-of-level pop up. 

Segment your players

As a game developer, your goal is to create a fun and engaging experience for all of your players. However, your players behave differently and are motivated by different factors, which is why you should leverage segmentation tools to tailor your ad strategy to user groups. 

The more relevant you make your rewarded video placements and offers for your players, the more likely they are to engage with your ad - bringing more revenue into your pockets and improving the user experience.

Common segmentations include:

  • Paying/non-paying users
  • Whales/dolphins (by the size of IAP)
  • By the session length
  • Loyal and casual players (by the time spent in the game)

But how do you actually learn about your players and their behavior in order to split them into these groups? We recommend using your mediation platform, which should offer segmentation tools to help you tailor your rewarded video ads to different user groups, in combination with a dedicated analytics platform. This combination will give you a strong understanding of your users’ behavior and help you create an effective segmentation strategy. 

For example, if you find a correlation between long session lengths and high rewarded video usage rates, you could increase your capping limit for groups of users with long session lengths.

Here’s another example for personalized experiences: try giving paying users, such as monthly subscribers, access to the rewards offered by your rewarded video placements - without having to watch the video. This can be an effective way to make these players feel valued in the game and happy with their spending. 

A/B test everything

Finally, it’s crucial to A/B test everything. When you have your ad monetization plan ready, don’t rush. Implement the plan gradually, starting with only a few rewarded video placements and measuring how they perform.

The main rule of A/B testing is making one change at a time. Then you can clearly see the effect of your changes and analyze the impact on your KPIs. Here are three important components of your strategy that you should constantly A/B test:

Capping

Capping refers to the number of times an individual user sees an ad within a session - in other words how many times you display traffic drivers to rewarded video offers. The main use of capping your rewarded videos is to prevent users over-using them and accumulating too many resources, which could damage the overall game economy and make your IAP offers redundant. Your capping strategy will differ depending on your genre - hyper-casual games for instance will set a higher number of placements, because IAPs are less of a focus in this category compared to casual and midcore games.  

Pacing

Pacing refers to the interval of time in between each ad placement. You could, for example, have an ever-present rewarded video traffic driver on the game’s homescreen, and A/B test implementing rewarded video placements every minute or two at the end of levels. Making your game abundant or scarce of rewarded video offers could impact your ads’ engagement and usage rates, as well as your IAP revenue, so keep an eye on the data to see what works best for your specific audience. 

Placements

Placement refers to the specific moments in the game you actually show your traffic drivers as well as the reward itself. With good placements your rewarded videos will be highly visible and accessible: this will maximize engagement and usage rates, and in turn meet your ad revenue goals. 

In addition, a good placement strategy is also key to providing the best user experience. It’s not enough to make your rewarded video ads just visible - you need to make them visible in the right situations, when the rewards will be most valuable to users.

You can test placements like offering an extra life after failing, doubling or tripling rewards at the end of a level, daily bonuses, and surprise chest boxes. Take a look at the examples we shared earlier for inspiration.

And remember, if something doesn't perform, you can improve it. And if something performs well, you can improve it too!

“ironSource’s game design consultancy helped us provide a new engaging and effective ad placement for users in our hyper-casual game, 9 Months. They made sure that all our ad placements were well-thought out and provided a positive user experience.” 

- Danrui Wang, Digital Advertising & Monetisation Analyst at Green Panda

 

This article was based on research from ironSource’s game design consultancy service, which helps games increase revenue and improve their user experience.

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