Optimizing Game Design for Ad Monetization

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The mobile game industry has exploded since the launch of the App Store in 2008 with countless new titles appearing every day and ample opportunity for strong advertising revenue. However, not everyone has succeeded in making a profit from their marketing efforts. Sure, Words with Friends, Solitaire, and Candy Crush Saga have done it, but many developers fail to see a strong return on their investment. Here are some tips to consider and how to choose the right type of ad formats for your game.

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GigaMedia increases focus on social casino, plans launch suite of casino games

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As many developers shift toward social casino games, Taipei-based GigaMedia announced that it would be launching a new suite of casino games last Tuesday. The new suite will be released in approximately the next four weeks.

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Guest Post: King.com’s move to pull ads more about user experience and less about the effectiveness of in-game advertising

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King’s decision to pull all its in-game advertising from mobile, web and tablet shouldn’t be seen as a judgement on the effectiveness of advertising, but rather as a decision to put the user experience ahead of advertising revenue. With the rise of freemium and paymium apps, we’ve seen rapid growth of in-app advertising both as a key discovery channel and way to drive installs. In addition to this, it signifies advertising as an earner in its own right for any publisher with a big installed base. At first glance then, King’s decision seems to run contrary to the trend of using more advertising, rather than less. After all, with the daily spend on install based advertising passing $80,000 in order to get to the top of Apple’s app store, many developers are prioritizing advertising spend above everything else.

The reality is that King understands very well that there’s a trade-off between in-app ads and retention rates. High retention rates are vital for getting to the top of the app stores if you’re not willing to spend your way to get there. Yes, by reducing advertising spend you may decrease the flow of new users and lower your ARPU, if the number of highly engaged, loyal players that spend more on IAP rises to more than the amount lost from the decrease, the net revenues will be higher.

For a game that is engaging and monetizing as well as Candy Crush Saga, there is an opportunity cost to showing advertising. Poorly integrated advertising can be very jarring and deliver a poor overall experience. This has certainly been an accusation leveled at many freemium games in the past, even those from chart-topping developers. For an app to be successful, retention is as important as acquisition. Retention drives the majority of IAP over time. So King may well have seen that there is a far bigger upside in terms of keeping users playing its games than there in generating revenues through advertising. In response, it has adjusted its strategy to fit this new model.

Perhaps one of the lessons here is that effective In-app advertising isn’t about cramming ads into every spare inch of a game; it’s about fitting into the UI in an unobtrusive way that doesn’t detract from the user experience or gameplay. Done well, advertising is a vital part of the business model behind the majority of apps. Some developers create a user experience which is actually optimised so that the display of adverts like interstitials is seamless within transitions and loading screens, while some will look to focus on in-app purchasing for revenue instead. There is no set method for turning a popular app into a cash-generating one: any developer that takes the advertising route needs to think carefully about how and where in-app ads appears in their games, in the same way they would think about in-app purchasing or the price strategy for a premium title.

Chris Hanage is Managing Director for Europe at mobile distribution and monetisation company PapayaMobile. Prior to joining PapayaMobile in September 2011, Chris spent two years as Business Development Director at branded mobile internet and operator portal site developer Momac.

Bees and Pollen: What Games Can Learn From Social Insects

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(Image from Alan Avidan, Bees and Pollen, showing LIft delivered by Bees and Pollen compared to competitors)

 

[Editor's Note: This story was a recap of an interview InsideSocialGames.com had with Alan Avidan, Executive Director of Business Development at Bees and Pollen occurred on June 6,2013, during Day 1 of the Inside Social Apps Conference in San Francisco.]

Alan Avidan of Bees and Pollen is working on a new type of game play: predictive personalization. The idea stems from the fact that many players get frustrated when they get stuck. For beginners this might mean not clearing level one, where as for more experienced players, the breaking point might occur when they can no longer unlock certain features without using the virtual store.

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PapayaMobile launches SDK aimed at monetizing in China

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Social game distribution and monetization company PapayaMobile announced the launch of a new SDK to help independent Android developers access the Chinese mobile market.

The first free game with in-app purchases to launch in China using the new SDK will be Scottish developer Cobra Mobile’s WW2 shooter iBomber for Android.

The PapayaMobile SDK helps Android app and game developers monetize by plugging into the company’s cross-promotion and ad network AppFlood, where they can buy, sell or exchange ads and traffic with advertisers and other publishers.

More importantly, the SDK also plugs into China Mobile, China’s biggest mobile operator with more than 700 million subscribers, to allow for in-app purchasing via carrier billing.

Carrier billing is tremendously important if not absolutely necessary in order to monetize in the Chinese market. In November 2012, CocoaChina’s US GM Lei Zhang Zhang told us that carrier billing accounted for 90 percent of Fishing Joy 2’s total revenue of $1.6 million per month. At the 2013 Game Developers Conference Yodo1’s CEO Henry Fong told us that there may be other companies that are able to push games and apps to the many Android app stores in China, but that only those with standing deals with the mobile carriers and access to carrier billing will be able to monetize.

The official release from PapayaMobile claims that the company is taking the lead in opening up the Chinese market to Western developers, but in reality they are already in competition with big and established players such as the aforementioned Yodo1 (which also offers important localization services), InMobi’s App Publish distribution platform which can push an app or game to more than 130 Android app stores in a few clicks, and others.

MediaSpike goes mobile, hires Manny Anekal as CRO

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In-game product placement advertising company MediaSpike today announced it’s making its services available to mobile developers and that it has hired Manny Anekal as Chief Revenue Officer. Anekal, who formerly led in-game advertising sales at Zynga, EA and Microsoft, will also “initiate” the company’s presence in New York City

MediaSpike is geared towards letting developers and advertisers work together to put product brands into games with a minimal amount of fuss. The way the system works is developers can apply two-dimensional images with product advertisements to parts of their game.

MediaSpike allows advertisers to use lightweight SDKs to target specific user groups while the company’s background servers do the lion’s share of the work. An advertiser selects the target audience’s demographics (which determines which partner game the content will appear in) and the length of the campaign. From there, the SDK lets a user select what type of item would sport a brand image, with arbitrary sizing being automatically supported.

Now iOS and Android game developers can join MediaSpike’s platform lineup alongside offerings for Flash and javascript developers. Mobile game developers can add this new revenue stream by dropping in the appropriate library and declaring which objects can become placements. MediaSpike then works with major brands to place the appropriate ads.

MediaSpike also revealed that a recent campaign for Pepsi which placed virtual vending machines in Gaia Online had players interacting with the machines and even complaining when the campaign was finished and the machines removed.

Director of Digital Brand Marketing at PepsiCo Beverages Andrea Harrison said “We love seeing these kinds of results.”

Director of Sales & Business Development at Gaia Interactive Christopher Castagnetto was also pleased with the service. “For a small, one-time integration effort you get a new, on-going revenue stream that also enhances the user experience,“ he said. “We’re looking forward to many more product placement campaigns.”

Director of Sales & Business Development at Gaia Interactive Christopher Castagnetto was also pleased with the service. “For a small, one-time integration effort you get a new, on-going revenue stream that also enhances the user experience,“ he said. “We’re looking forward to many more product placement campaigns.”

PlayHaven picks up AdMob’s Charles Yim as COO

Charles Yim_Headshot[1]Mobile game developer resource PlayHaven announced a new hire today with Charles Yim joining the company as Chief Operating Officer. Yim was previously at AdMob, which was acquired by Google in 2010.

PlayHaven’s mission is to maximize the lifetime value of a mobile game player; a large part of this strategy comes from advertising, which is where Yim’s expertise comes in. With more mobile developers turning to native video ads as a monetization solution, it makes sense to bring in a guy that helped AdMob launch mobile video on iPad and Android tablets. PlayHaven has grown to 60 since closing an $8 million third round of funding late last year.

The following is a brief interview conducted with Yim earlier this week.

Inside Social Games: Do you see Tablet emerging as the dominant “mobile” games platform in the next year, or are we already there?

Charles Yim: If you look at the games industry holistically, it’s pretty broad. Each different game genre — a casual game, a casino game, a hardcore game — they lend themselves to different users and tablet is a good platform for certain genres, but not all genres. I don’t think tablets are the end-all, be-all of the industry.

ISG: We’ve seen a lot of advertisers and ad platforms focus on video in the last year — including AdMob. Where can native ads go beyond video?

Yim: The ongoing debate that you find is in the advertising technology perspective — on one side of the spectrum, you have super native and then on the other you have scalable. When I think back to AdMob in 2009 when we came out with our own video ad unit, the companies were developing niche swipable video ad units, but the industry couldn’t scale those. Integrating with a large number of publishers was a difficult process to manage. Whenever you look at a new channel in native ads, there’s a natural dynamic tension between delivering a native, unique experience and something that can be scaled. AdMob’s [ad unit] was the first that really gained traction because it was easy for advertisers to understand. The things you could do outside of video is really a question of how much deep integration are people willing to do and are advertisers willing to buy into that experience.

ISG: What’s the biggest mistake game developers make in implementing ads on mobile?

Yim: Game developers have gotten much better at this, but they think about building their game before they think about monetizing it. They’re very focused on the player experience and afterwards, they slap ads on top of it. Savvy game devs in mobile understand that ads are a important part of the business model and they incorporate that into their game from the get-go.

ISG: Anything to add?

Yim: My motivations for joining PlayHaven are asking what are game developers doing well or not doing well. As the industry matures, the needs of the developers mature. As their business scale and grow, they run into growing pains they haven’t anticipated. PlayHaven has an incredibly talented team and the best perspective on what’s coming and on helping game developers manage their businesses.

W3i’s Erik Lundberg on Android games monetization, tablet dominance, closing the gap with iOS

Monetization and insights provider W3i is stepping up its game with Pocket Gems and other mobile game developers on Android going into 2013. This could be the year that Google’s platform finally catches up in revenues to Apple’s iOS.

Through its expanded partnership with Pocket Gems, W3i now provides monetization solutions to Tap Paradise Cove and Campus Life. Far from being mere banner ads, the monetization service focuses instead on providing a native experience in these Android apps — tailoring ads, offers and video campaigns to the user experience.

Erik Lundberg, General Manager at W3i’s San Francisco office (pictured), explains that the shift toward native experiences comes from mobile advertising finally moving away from online advertising models. With 15 years in online ads before joining W3i just eight months ago, he’s had time to study the changing trends.

“In the early days of ads and mobile apps, people took online models and slapped them on a smartphone like small banner ads that are only 100 pixels wide,” says Lundberg. “Users have tuned those out. More native ads like a full screen interstitial or offer-based ads, we see a much higher CPM, like 10 times higher. We think that trend will continue toward native ads that are a part of the application instead of just throwing up a banner.”

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Liveblogging from Inside Social Apps, New York: Platform Opportunity in 2013

We are in New York for the Inside Social Apps conference at the New Yorker Hotel. Managing Editor of Inside Network AJ Glasser sat down with a panel on the topic of platform opportunities for 2013. The panel consisted of Jamie Conroy, Director of Special Product at TripAdvisor, Josh Hubbal, Head of Business Development at App.net, David Miyoshi, VP of Social Games at GSN Digital, John Spinale, SVP of Social Games at Disney Interactive Media Group and Jeremy Toeman, CEO of Dijit Media.

The panel offered perspective on what major platform operators ought to be doing to improve the developer ecosystem. The Following is a paraphrased account of what was said on the panel.

Glasser: Platforms are a constantly evolving space, where are your users coming from?

Conroy: More and more people are coming through mobile or Facebook. Facebook is interesting as a touch point for users. It is important to optimize experience on Facebook. It is important to fit into the flow of the platform that you choose.

Miyoshi: Mobile is more for paid content.

Spinale: There is a casual gaming audience there as well. Dependent on User interfance and platform. More and more people are accessing mobile platforms.

Toeman: The No. 1 driver is app store SEO. It’s a highly specific, highly known universe. You get natural uplift from television viewers and associated app SEO.

Hubball: We’re starting to see other social services using app.net, word of mouth and cross posting on Facebook and Twitter.

Glasser: What is the biggest challenge in becoming a cross platform developer?

Miyoshi: Hiring top talent. Everybody wants to work on mobile right now so you need people that are willing to work on separate platforms.

Spinale: Creating the right experience at the right point in time.

Conroy: Now that mobile has proliferated it is especially complex. Developers need to ensure they are available to their users across all the platforms and provide a good experience there.

Toeman: We need a more purposeful experience. People access our products through different devices so we had to reinvent what the experience is. It is important for you to create the right experience for the item they are using. You need to figure what to be rather than being cross platform.

Hubball: We focused on building the API. It is the most expressive use of information available. Instagram focused on iOS when It started which allowed it to focus on a good job. Focusing on being cross platform makes you spread out resources.

Glasser: What is the best technology to use for apps that aren’t games?

Toeman: HTML is the only way to go, it is versatile. The Android tablet experience isn’t at the level of what could be offered at the moment.

Hubball: Our initial strategy was a hybrid of different technologies.

Glasser: The cost of user acquisition is rising. What do you expect to see in the competition between the platforms in the next year?

Toeman: Next year it is going to be much more expensive for iOS user acquisition so it is important to focus on that until the new year.

Glasser: Do you see potential other emerging platforms in the future?

Miyoshi: Windows is worth a look with how heavy they are pushing this platform as a competitor.

Toeman: No way. consumers are smart. It is one of the best products they have put out, the ship has sailed for windows.

Miyoshi: We look at iOS users as the most valuable, the Android user is dead. We may see windows. They may not dominate, but there could be a shift in user base.

Toeman: The iOS is so much far ahead than others and that is why we may see better experiences.

Glasser: Which phone do you have with you today?

All the panelists say they have an iPhone with them.

Conroy: It is important to look across the world as many users are outside of the english speaking territories This is why iPhone and Android are see large growth ant the market can still change.

Glasser: If you could go back a year, what changes would you make based on what you know now?

Toeman: Simplify. Cut things down. Get everything you can get in your app in the simplest way possible. Reduce the clutter.

Hubball: The business model of the platform for which you are developing for is important. if your plan does not fit into what they are doing, you need to adjust.

Spinale: We would have jumped on the Android bandwagon earlier.

Miyoshi: Focusing and doubling down. Once you see success, you should focus.

Rumble ready to roll out Nightmare Guardians to tablets, preps multiplatform publishing

KingsRoad developer Rumble Entertainment activates on its multiplatform strategy with a second game, Nightmare Guardians, launching on tablets in early 2013.

The company has an aggressive growth strategy aimed at being both developer and publisher right from the point of launch. Rumble secured a $15 million first round of funding nearly a year ago before any of its games had been released. But, as CEO Greg Richardson tells Inside Social Games, Rumble was already hard at work on developing a suite of titles to straddle mobile, social and open web platforms. By covering all the rapidly growing bases, the company is better set up to act as a publisher of third-party titles on any or all of these platforms.

“We [wanted] to be a publisher from day one,” Richardson says. “We needed a platform that could reach multiple devices and [support] multiple genres. KingsRoad and Nightmare Guardians work on the same backend, which shows the strength of our [publishing] platform.” (more…)

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