By Meagan Martino, Head of Demand, EMEA and Americas at AppLovin
Over the last few years, mobile gaming has started to catch the attention of in-the-know brands and marketers looking to reach not only a conventional gaming audience, but also a broader bench of individuals who traditionally haven’t been considered gamers. Today, hyper-casual mobile games, especially, are proving a strong channel to get in front of diverse groups of people – from the teenager looking for a quick gaming break in-between study sessions, to the grandparent who cherishes their daily word puzzle.
By their very nature, hyper-casual games appeal to the mass market. Their ease of use and wide accessibility attracts a diverse audience – including both traditional and non-conventional gamers – making their earning potential vast.
Though, as the genre grew in popularity, so did its critics. Many brushed off hyper-casual gaming as a fad due to its simple mechanics. But, over the past few years, hyper-casual has proved itself resilient. In fact, estimates show that over half of 2022 gaming revenue is set to come from hyper-casual games.
And, according to App Annie, of all top game downloads in 2021, hyper-casual titles were the top three genres, amassing more than four billion downloads over the course of the year. So, while there is clearly a demand for this type of game, the question for marketers is: is there a sustainable business model for brands within hyper-casual? Thanks to in-app advertising and sophisticated user acquisition, there certainly is.
Considering the ad formats
Mobile app advertising allows developers to make money through ads delivered inside their mobile apps. For advertisers, there are a variety of in-game formats available that serve different purposes in order to reach and engage new audiences and drive higher revenue. Ultimately, one of the key benefits for brands and advertisers within games is the idea that such apps are inherently brand-safe: unlike other digital environments, there is no chance of unfavourable or random user-generated content popping up on the screen in games that would affect brand image.
Here are the main ad formats to consider in games:
Interstitial ads — Interstitials grab the viewer’s attention by taking over the entire screen during a natural pause or transition in the app — for example, between levels of a game.
Rewarded video ads — These are opt-in ads that give players the option to view them in exchange for some sort of reward. In a game, for example, the player could be rewarded with an extra life, in-game currency, or power-ups after they watch the video. This value exchange is why rewarded video ads remain the most positive ad experience for gamers in 2022.
Native ads — Native ads blend into the natural experience of the app in which they are placed. They are typically best placed in-stream with the rest of your content, such as after an action has taken place or in-between levels of a game.
Playable ads — Playable ads allow the user to actually play the game for a short period to entice them to download the full version.
Embracing in-app bidding
Most hyper-casual games are monetised via a mix of the above ad formats, and today, many hyper-casual developers are embracing in-app bidding, which provides publishers with an unbiased auction for each impression instead of relying on a manually-curated waterfall.
In-app bidding offers a win-win for both the publisher and the advertiser: for smaller hyper-casual game developers, the introduction of in-app bidding services like AppLovin MAX has freed up a significant amount of time for them to spend creating great games instead of monitoring a monetisation stack, while, for advertisers, in-app bidding offers the ability to compete directly in the unified auction in real-time for impressions rather than being placed in a hierarchy of demand partners.
For marketers looking to leverage hyper-casual gaming as an advertising opportunity, there are a few key factors to consider. Firstly, it’s important for marketers to know the audience they are trying to reach and ensure that their in-game ads are created and placed accordingly. The more closely aligned to the target audience, the more marketers will get out of their ad campaign. This hyper-focused advertising means that marketers can move away from wasting money on an audience which is unlikely to click or purchase a product through an ad.
Secondly, as with any environment, defining your key performance indicators (KPIs) for advertising within hyper-casual gaming is critical. KPIs can vary greatly depending on the type of advertiser and campaign goals. App marketers looking to drive installs, for example, might evaluate the LTV (Lifetime Value) of the users they acquire, while brand and agency advertisers seeking to drive website conversions and awareness might look to optimise against metrics such as reach, price, and viewability.
With such fierce competition in the mobile app gaming environment, too, it’s essential to monitor ad campaigns to see how they can be improved. A mobile measurement partner (MMP) can help app marketers do just this, by tracking their campaign performance across multiple advertising channels.
Hyper-casual in-game advertising represents a meaningful opportunity for brands to reach and engage with new and targeted audiences at scale. With women now making up the majority of the hyper-casual gaming audience, and the average age of hyper-casual gamers being around 33, the genre is proving to be a channel of increasingly diverse, highly-engaged consumers. In an era when mobile gaming is thriving, brands should be looking at hyper-casual gaming as a tried and tested method to help them connect with audiences where they’re spending their time: in mobile apps.