By Andi Nuruljihad

Rewarded Video ads are taking over mobile games. They offer a novel way to integrate ads with gameplay by giving players in-game rewards for their ad views. Here we’ll explore this ad form and how it’s changed the face of free-to-play advertising. We will also look at the incredible numbers behind its explosive growth.

Making the ads parts of the game

A great advertising strategy involves much more than simply counting ad impressions. Having tons of eyes on an ad is great, but it doesn’t mean much if none of those views lead to click-throughs. Any marketing team will tell you that improving click-through rate is no small task, but it’s doubly hard in video games where ads compete with the game itself for screen space and the player’s attention.

Previously, the go-to way to grab the player’s attention has been to put the game on pause and make the player sit through forced ads. The trouble is that taking the player out of the game can cause a loss in interest -- both in the ad and the game. To the player, ads just get in the way of the fun. For this reason, developers spend a lot of time tweaking numbers to find the right balance between game time and ad time. They need to keep players engaged but maximize ad impact -- two things that often contradict.

Rewarded video ads keep players attentive even when ads are playing by rewarding them for their time. Usually, these rewards are in the form of in-game items or virtual currency. For example, the player can choose to watch a short ad in exchange for Gems that can be used to upgrade their character. By making the ads an important part of the game, developers don’t have to force their players to watch ads anymore -- they do it all on their own.

Player response to rewarded video and its impact on developers

Players of free-to-play mobile games are showing their support for rewarded video. In a report by Unity Ads, 62% of mobile game players regularly watch rewarded video ads. 71% of the users surveyed preferred rewarded video over in-app purchases and premium purchases. Interestingly, the new ad form’s popularity hasn’t led to a decline in in-app purchases. 86% of polled developers reporting that in-app purchases were unaffected by the integration of rewarded ads.

The news is good for developers, too. Rewarded video ads outperform other ad forms in all metrics. The click-through rate of rewarded video ads outperforms regular video ads by 45%. Even better, rewarded video also has a 33% higher conversion rate. Player retention, a make or break statistic for free-to-play developers, also climbed or stabilized for 62% of developers. Overall, rewarded video ads led to a 43% higher return of interest for developers and were the most lucrative form of in-game advertising for 52% of them.

What does all of this mean for advertisers? According to Business of Apps,eCPMs for rewarded video ads were a whopping 86% lower than regular, non-rewarded video. A case study conducted by Aarki on social casino advertisers found that rewarded video ads drove 45% lower CPI than standard video advertising. These numbers make it clear: rewarded video gives advertisers more bang for their buck.

Rewarded video ads are the future of app advertising

Rewarded video ads are a win-win-win for developers, advertisers, and players. Players prefer the new ad format, and they’re showing their support with their views. Developers love how they don’t disrupt the user experience and keep their players playing for longer. Advertisers love that they’re getting more for their advertising money thanks to the low eCPMs and higher click-through rates. Very rarely is there an advertising format that appeals to all parties involved, making it no surprise that more and more developers are integrating rewarded video as a major part of their monetization strategy.