Why game developers must rethink their advertising strategy

What if you could go to the movies for free, but every 15 minutes the film would stop for a commercial break? A few very cost-conscious people might tolerate it, but I reckon most would refuse to ruin their cinema experience that way.

Similarly, there’s a good reason game developers dislike in-app advertisements: They distract your customers — and frequently discourage them from using your product.

“Gamers want to game. So disturbing the gamer’s experience, even if it brings value, isn’t always the way to go,” wrote Avi Hadas, in a recent guest column on in-game advertising for VentureBeat.

The stakes are high. In an industry concerned about churn, retention, and monetization of players, in-game ads might save your business — or end up killing it.

A necessary evil

massive 51 percent of developers said they consider in-game advertising a “necessary evil” yet some 38 percent still consider it an “important” monetization opportunity, according to a recent survey by analytics firm deltaDNA.

“The study from Edinburgh-based deltaDNA shows that many developers are leaving cash on the table over fears of how ads impact player engagement, enjoyment, and retention,” wrote VentureBeat’s Dean Takahashi last month. “That’s a problem worth addressing in the $36 billion mobile game industry, where advertising has become a must for developers who want to get their games better attention in a sea of competition.”

This issue really speaks to the two main pillars of the game industry business model: Acquiring players and finding a way to monetize them.

The shift to free-to-play games has undoubtedly unlocked new opportunities to capture a greater audience. But it has also put the onus on developers to make revenue from their players. With just one to two percent of people making in-app purchases, many turn to in-app ads to help generate cash. However, as I’ve already pointed out, this runs the risk of annoying your customers and driving up churn.

So what’s the solution?

Game developers must rethink their user strategy and take a more proactive approach from the beginning of the pipeline to the very end. Stop tapping into the often-fraudulent black box not knowing anything about the source and characteristics of the leads you acquire. Stop treating in-app advertising as the last resort in squeezing pennies out of your valuable players. And stop shooting from the hip when it comes to retargeting.

Challenging the status quo

Our Berlin-based start-up has analyzed over 150 games and some 6,000 acquisition campaigns. We believe the time has come to challenge the status quo.

Launched only in March, Simplaex is a peer-to-peer platform that doubles as a player marketplace. Counting many of the game industry’s biggest companies as clients, we already have access to over 100 million gamers. There are no middlemen and there’s no fraud. It’s direct and extremely effective.

Using solely first-party data and its own real-time bidder, our new platform completely bypasses the traditional ecosystem for digital marketing. It allows you to target real and identifiable players based on their specific gaming habits and profiles.

Start engaging your players before they leave your game and reengage only those that fulfill your set criteria, like a minimum number of sessions. Plus, our personalization techniques have been proven to increase reengagement rates by up to a factor of five.

Out-of-app ads

The best part? It’s all done with out-of-app advertising. This means you can easily monetize both your active and inactive player base while avoiding the downsides of in-app ads.

These out-of-app ads might frequently be from other developers looking for their own new installs. But there’s another level to this, of course. Gamers are an in-demand demographic for certain products. Maybe headphones-maker Beats knows they buy an above-average amount of tech gear. And perhaps energy drinks company Red Bull believes they have a thirst for its fizzy beverages.

Instead of ruining the flow of a game, developers can now make money by putting ads in front of their players when they’re on Facebook at work, shopping for socks on Amazon at 3 a.m. or just randomly surfing the web. Out-of-app ad technology makes it all possible. And, just as important, lucrative.

So what are you waiting for? That guy shopping for new socks might just be the future of your business.

LATEST NEWS

Simplaex Is Leading The Next Mobile Wave In Transforming Data Into Insights And Insights Into Action

Simplaex, experts in marketing mobile games, has recently closed its successful A-round funding. The Berlin-based company will use the capital to expand into new verticals and deliver its proprietary technology to a broader customer base. To this end, Simplaex is positioning itself as the most advanced data insight & activation platform. Below is our recent interview with Jeff van Ede, Co Founder & CEO of Simplaex:

First-party Data Innovator Simplaex Closes $2.6 Million Funding Round

Simplaex, experts in marketing mobile games, has successfully closed its A-round funding. The Berlin-based company will use the capital to expand into new verticals and deliver its proprietary technology to a broader customer base. Helping to drive this expansion will be Perry Ofir, Simplaex's newly-appointed CRO who was formerly VP of Sales & Business Development at Adgorithms.Simplaex launched in April 2016 as a groundbreaking marketing platform for game developers. In the twelve months since, it has grown into a sophisticated data marketplace with over 300 million unique user profiles. On the back of this impressive growth, the company is now looking to expand beyond the gaming industry.

Simplaex Surpasses 150 Million Players for Game Developer Platform

Simplaex, a revolutionary peer-to-peer platform for game developers, now offers direct access to over 150 million players. The important milestone comes just ten months after the Berlin-based start-up set out to transform game marketing. Developed together with some of the world's leading game companies, Simplaex is laser focused on the two main pillars of the industry's business model: Acquiring players and finding a way to monetize them. The groundbreaking technology completely bypasses the traditional way of game marketing, giving developers immediate access to a transparent and effective player marketplace.

First-party Data Innovator Simplaex Closes $2.6 Million Funding Round

Simplaex, experts in marketing mobile games, has successfully closed its A-round funding. The Berlin-based company will use the capital to expand into new verticals and deliver its proprietary technology to a broader customer base. Helping to drive this expansion will be Perry Ofir, Simplaex's newly-appointed CRO who was formerly VP of Sales & Business Development at Adgorithms.Simplaex launched in April 2016 as a groundbreaking marketing platform for game developers. In the twelve months since, it has grown into a sophisticated data marketplace with over 300 million unique user profiles. On the back of this impressive growth, the company is now looking to expand beyond the gaming industry.

Simplaex Surpasses 150 Million Players for Game Developer Platform

Simplaex, a revolutionary peer-to-peer platform for game developers, now offers direct access to over 150 million players. The important milestone comes just ten months after the Berlin-based start-up set out to transform game marketing. Developed together with some of the world's leading game companies, Simplaex is laser focused on the two main pillars of the industry's business model: Acquiring players and finding a way to monetize them. The groundbreaking technology completely bypasses the traditional way of game marketing, giving developers immediate access to a transparent and effective player marketplace.

Simplaex launches the first peer-to-peer marketing platform for game developers to buy, engage and sell players

Simplaex is officially launching its next generation marketing technology platform at GDC 2016 in San Francisco that solves the problem of today's user acquisition and retention in both mobile and online gaming. Since the introduction of the F2P business model the gaming advertising industry has developed into an ecosystem that is controlled by networks, agencies, brokers and resellers. Game developers and game players are more disconnected than ever before.

Why the game marketing ecosystem is ripe for disruption

For many game developers, the traditional way of promoting their products online is broken beyond repair. With no direct digital access to potential customers, they depend on an ungainly mix of ad exchanges, media buying platforms, data aggregators, agencies, and resellers. The results of such a tangled web are predictable: Unfair prices, low-quality leads and surging churn rates. This unsatisfying situation has led many game developers to shift their focus from customer acquisition to retention in the hope of boosting the cost-effectiveness of their marketing strategies.

Why game developers are neglecting their players

Can you imagine going to a restaurant that made it increasingly harder to get through each course of a meal? Sure, you can have your appetizers, but to eat your entrée you’ll have to cross the street to another location. And don’t forget to bring your spoon with you — otherwise you can forget dessert! No, I can’t imagine that either. But that’s exactly what the game industry does to its customers. It makes products that are by their nature progressively more difficult to consume. It’s the developer’s conundrum: Every gamer is intrinsically different yet they’re all playing the same game. They have various levels of skill and determination, as well as a range of ideas about what constitutes success and brings gaming satisfaction. It’s impossible to make a game that’s a perfect fit for everyone, but you can try to look after your active users and make sure they’re happy.

Why game developers should embrace player churn

Churn. It’s an ugly word. Game developers are naturally concerned about player retention. But eventually even the most ardent player loses interest in a game. It’s normal. It’s part of the cycle. And so it’s also normal when developers are inclined to squeeze the absolute maximum revenue out of people before they’re gone forever. However, trying desperately to monetize your players only increases churn, aggravating the problem.

Why game developers must rethink their advertising strategy

What if you could go to the movies for free, but every 15 minutes the film would stop for a commercial break? A few very cost-conscious people might tolerate it, but I reckon most would refuse to ruin their cinema experience that way. Similarly, there’s a good reason game developers dislike in-app advertisements: They distract your customers — and frequently discourage them from using your product. “Gamers want to game. So disturbing the gamer’s experience, even if it brings value, isn’t always the way to go,” wrote Avi Hadas, in a recent guest column on in-game advertising for VentureBeat. The stakes are high. In an industry concerned about churn, retention, and monetization of players, in-game ads might save your business — or end up killing it.

Is Your App Retargeting Strategy Ready for Holiday Season?

What if you could go to the movies for free, but every 15 minutes the film would stop for a commercial break? A few very cost-conscious people might tolerate it, but I reckon most would refuse to ruin their cinema experience that way. Similarly, there’s a good reason game developers dislike in-app advertisements: They distract your customers — and frequently discourage them from using your product. “Gamers want to game. So disturbing the gamer’s experience, even if it brings value, isn’t always the way to go,” wrote Avi Hadas, in a recent guest column on in-game advertising for VentureBeat. The stakes are high. In an industry concerned about churn, retention, and monetization of players, in-game ads might save your business — or end up killing it.