Designed to Win: How to Monetize Users and Enhance Experience in Your Game
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This document discusses strategies for monetizing mobile games through in-app video advertising using permission marketing rather than interruptive ads. It introduces the STARS framework for integrating ads into the natural flow of a game at scenes where players are waiting or during breaks in gameplay. The framework involves using triggers at these scenes to prompt players to view an ad in exchange for rewards that provide social, access, or progression benefits in the game rather than just currency. The goal is to make ads an engaging part of the game experience rather than an interruption.
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Designed to Win: How to Monetize Users and Enhance Experience in Your Game
- 1. DESIGNED TO WIN How to Monetize Users and Enhance Experience in Your Game Infrastructure for in-app video advertising
- 2. 2Infrastructure for In-App Video Advertising A LITTLE ABOUT US Jahed Momand Sr. UX Designer Contact Vungle: monetize@vungle.com Michal Pilawski VP of Product
- 3. 3Infrastructure for In-App Video Advertising 85% 72% 62% (93% per game) THE PRICE MOST CONSUMERS ARE WILLING TO PAY
- 4. 4Infrastructure for In-App Video Advertising BUT ADVERTISERS PAY THEIR BILLS 49% 46% 7%
- 5. Infrastructure for In-app Video Advertising ADVERTISING CAN BE HELPFUL
- 6. 6Infrastructure for In-App Video Advertising BUT IT MOSTLY INTERRUPTS FUN AND CREATES NOISE KESSELSKRAMER AdvertisingforPeopleWho Don’tLikeAdvertising
- 7. Infrastructure for In-app Video Advertising THEAVERAGEAMERICAN SEES 5,000ADSADAY
- 8. 8Infrastructure for In-App Video Advertising AND WE LEARN TO IGNORE ALL OF THEM Click-through rate in 1994: 74% Click-through rate in 2006: 26% Click-through rate in 2014: 0.05% Click-through rate in 2014: 0.38% WEB MOBILE
- 9. 9Infrastructure for In-App Video Advertising THE ADVERTISING INDUSTRY COMBATS THIS WITH DECEPTION
- 10. 10Infrastructure for In-App Video Advertising FOR WHICH WE COINED A TERM: NATIVE ADVERTISING
- 11. 11Infrastructure for In-App Video Advertising OR BY INSERTING ADS WHEN WE ARE MOST ENGAGED
- 12. 12Infrastructure for In-App Video Advertising THESE INTERRUPTIONS CAN REALLY ANNOY YOUR PLAYERS
- 13. 13Infrastructure for In-App Video Advertising ALTERNATIVE: PERMISSION MARKETING Permission marketing is about creating value for consumers, so they actually voluntarily engage with ads. Anticipated Personal Relevant
- 14. 14Infrastructure for In-App Video Advertising EXAMPLES OF PERMISSION MARKETING Virgin Atlantic Blog Dollar Shave Club Viral Video
- 15. 15Infrastructure for In-App Video Advertising Example of Permission Marketing in GamesPERMISSION MARKETING IN ZOMBIE CATCHERS
- 16. 16Infrastructure for In-App Video Advertising PERMISSION MARKETING IN ZOMBIE CATCHERS
- 17. 17Infrastructure for In-App Video Advertising IN-APP VIDEO ADS EXTENDED USER SESSION LENGTH BY 25%
- 18. 18Infrastructure for In-App Video Advertising ADVERTISING CAN ACTUALLY BE A FEATURE OF A GAME Sources: Electronic Arts, Wildtangent, IHS, Macrovision, Strata, Wall Street Journal 86% prefer free games with ads over paid games without ads 71% prefer games with opt-in ads over games without 94% increase in the no. of visitors to in-game store
- 19. 19Infrastructure for In-App Video Advertising STARS FRAMEWORK FOR TURNING ADS INTO FEATURES Scene Trigger Action Reward Seed
- 20. 20Infrastructure for In-App Video Advertising ORIGIN OF THE STARS FRAMEWORK Combined experience of advising 100s of mobile games Research in game design, psychology, HCI and behavioral economics
- 21. 21Infrastructure for In-App Video Advertising Scene: event or placement within your game where ads will provide value to the consumer. From a cutscene or event scene, a sequence in a video game that is not interactive, a break in the gameplay. CHOOSE THE RIGHT SCENE FOR THE AD
- 22. 22Infrastructure for In-App Video Advertising MAKE SURE YOU REACH ENOUGH PEOPLE
- 23. 23Infrastructure for In-App Video Advertising DON’T BREAK THE FLOW OF THE GAME Resolution Climax Crisis Story Progress Commercial Break Cliffhanger model Ads interrupt at the peak of crisis to keep viewers’ attention on the screen during the commercial break.
- 24. 24Infrastructure for In-App Video Advertising TARGET PERIODS OF REST OR WAITING Resolution Climax (Final Boss) Crisis (Boss Fight) Story Progress STARS model Ads shown at natural breaks when players rest after particularly intensive challenge or wait for resources to be replenished .
- 25. 25Infrastructure for In-App Video Advertising PROVIDE VALUE WHERE PLAYERS NEED IT MOST
- 26. 26Infrastructure for In-App Video Advertising Trigger is a cue for a player to take actionTRIGGERS ARE CUES FOR PLAYERS TO TAKE ACTION
- 27. Video Monetization Platform for Apps EXTERNAL TRIGGERS ATTRACT ATTENTION AND ENCOURAGE ACTION
- 28. 28Infrastructure for In-App Video Advertising INTERNAL TRIGGERS ARE EMOTIONS: SEEKING PLEASURE AND AVOIDING PAIN Avoid boredom: waiting, loading time Relief frustration: reward after a loss
- 29. 29Infrastructure for In-App Video Advertising 2S WAIT 7% of customers lost 5S WAIT 22% of customers lost 20S WAIT half of customers lost
- 30. 30Infrastructure for In-App Video Advertising MAKE SURE THE EXPERIENCE IS GREAT • SPEED • QUALITY • DESIGN • RELEVANCE
- 31. 31Infrastructure for In-App Video Advertising IT IS NOT ONLY ABOUT CURRENCY Social Rewards Access Rewards Progression Rewards
- 32. 32Infrastructure for In-App Video Advertising SOCIAL REWARDS HELP PLAYERS FEEL ATTRACTIVE, IMPORTANT AND INCLUDED
- 33. 33Infrastructure for In-App Video Advertising ACCESS REWARDS HELP PLAYERS DISCOVER AND UNLOCK UNIQUE CONTENT
- 34. 34Infrastructure for In-App Video Advertising PROGRESSION REWARDS HELP PLAYERS PROGRESS IN THE GAME Scarcity Luck (Variable Reward) Require Significant Effort
- 35. 35Infrastructure for In-App Video Advertising PLANT A SEED FOR MORE MONETIZATION
- 36. 36Infrastructure for In-App Video Advertising STARS FRAMEWORK REVIEW Scene Trigger Action Reward Seed
- 37. Infrastructure for In-app Video Advertising Thank you …
- 38. 38 MEET THE SPEAKERS! Join us tonight from 6-8pm @ Oola (RSVP in back) Ben Bear VP, Sales Colin Behr VP, Business Development and International Michal Pilawski VP, Product Jahed Momand Sr. UX Designer
- 39. Infrastructure for In-app Video Advertising Q&A Questions?
Editor's Notes
- Hi – I’m Mike and this is Jahed
- - A little about us
- According to PWC and the industry reports (IFPI, etc.) for entertainment industry The Majority of Entertainment Consumers Are Freeloaders. This is true of… - Music: 85% of people listen to but don’t pay for music in Western Markets - TV: 72% of people in Western Markets watch only free TV - Games: 62% of mobile gamers never spend money in any game, but for a typical mobile game, only 7.1% of consumers spend money
- - 46% of $400Bn TV industry revenue is advertising - 49% of the $95Bn Music industry revenue is advertising - 7.2% of 75Bn gaming industry is advertising, but it is up from 4% two years earlier
- Actually advertising is useful. Overloaded with choices and decision process could be difficult Imagine entering a super market in the US and having to choose from the 387 brands of breakfast cereal that are sold in the US How about choosing which app to download from the 1.8m apps in the app store
- But we rarely see that value in advertising Mostly because we see advertising as an interruption to anything fun we might be doing, watching TV or playing a game And because it creates so much noise
- According to different estimates, we are seeing between 3,000 and 5,000 ads a day There are so many of them out there, that we became experts at ignoring them Who remembers the last three billboards you saw on the way to Moscone center?
- This ability to learn to ignore advertising is given for any new advertising medium Some call it Banner Blindness, Andrew Chen calls it a Law of Shitty Click-throughs Everyone hates banners, but there was a time when banners where effective Web banner (74% to 0.05%) – 1500 times down Mobile banner (26% to 0.38%) – not the first banner, but still 70 times down Despite investments in machine learning and collecting all the data about us
- One way the industry is trying to solve this problem is by masquerading ads as content Native Advertising dates back over a hundred years when first advertorials, ads pretending to be editorial articles appeared in the news The soap opera takes its name from the first TV series that were produced to market Procter and Gamble products Product placements in movies became the next wave of native advertising
- And Native Advertising is the hottest trend on the web and mobile
- Another trick is to insert an ad break at the most interesting point in a show or a game In the TV world it is called a Commercial Break Cliffhanger Everyone who watched Who Wants to Be a Millionaire remembers the moment a player gives an answer to a tricky question We all await in anticipation to see if he knows the answer He is asked “is this your final answer”… And we went to an ad break If you want to know the answer, you have to wait through the commercials
- These interruptions affect us regardless of the medium But TV audiences can’t give stars to shows based on how annoyed they are with ads interrupting their content They will however happily punish a game in the app store
- Seth Godin, 15 years ago, proposed an alternative Permission marketing: he proposed that instead of interrupting lives of audiences, we actually offer them value so they will voluntarily engage with ads Permission marketing is Anticipated: people will anticipate the service/product information from the company. Personal: the marketing information explicitly relates to the customer. Relevant: the marketing information is something that the consumer is interested in.
- There are many examples of permission marketing: Opt-in Newsletters Blogs, like the one on the left from Virgin Atlantic that actually offer true informative value Content marketing. The Dollar Shave Club is actually so ridiculously funny that 18.5m people went to voluntarily watch it on YouTube and 100k liked it Opt-in ads or rewarded ads are another example of permission marketing
- • I’ll share an example here from one of our customers Zombie Catchers. This is a wildly successful game from Finnish studio Two Men and a Dog, seeing 1.5 million downloads in the first week alone. • The co-founders, veterans of game development, knew that IAPs wouldn’t be enough to monetize the game, so they added Vungle video ads to complement this.
- • They implemented an opt-in placement that gives players faster access to zombies. Normally users only get two “catching sessions” before they have to wait. Watching a 15-second ad allows them to capture the undead again – right away.
- • Turns out, getting back in the game faster also encourages players to stay in the game longer. Kallonen estimates that video ads extend player session time by more than 25 percent. Similar uplift was seen in a study conducted by Electronic Arts, WildTangent and IHS. Prior to the ad experience gamers spent an average of 15 hours per week playing, after the ad experience gamers spent an average of 19 hours per week playing representing a 28% increase in the time spent in the game.
- Advertising can actually be a feature of a game: We reviewed three different studies conducted by EA, Wildtangent, HIS, Macrovision and Strata and they had very similar results 86% prefer free games with ads over paid games without ads 71% prefer games with opt-in ads over games without 94% increase in the number of gamers visiting the “add cash” area of the game after seeing value exchange ad. 66% want more opportunities to earn rewards through ads 83% of gamers say they are open to watching video ads, if they receive value in exchange (Macrovision study) 82% of consumers said they prefer to watch ads than pay for content (WallStreet Journal / Strate)
- At Vungle, we came up with a concept we call STARS, that we use to help partners think through the integration of ads in their game. This is a concept we use to ensure that the placement actually benefits the player, improves the user-experience and at the same time it engages players and supports monetization. It is based on five pillars Choosing the right scene to show an ad Choosing a trigger to get people to engage with an ad Ensuring the ad experience (action) is pleasurable Providing appropriate rewards for the user that do not affect the economy of the game Planting a seed for further action
- The framework is based on research in game development, psychology, human-computer interactions and behavioral economics And our combined experience of advising 100s of mobile games on creating ad placements in their games
- It all starts with selecting the right scene for where to put a trigger for the ad Define scene In the example on the left, Pocket Mine, the trigger is in the main menu--a great place to ensure there is a significant reach. Speaking of reach, there are three success factors to choosing a good scene: Reach – how many people will see it Flow – how does it fit with the flow of the game Contextual relevance – are the triggers and reward relevant to the player in this scene
- Reach: ensure that enough users will arrive at the event or placement to satisfy your monetization needs. In the Slots Tycoon example, the free button is next to the Spin and has the same color of red ensuring it stands out and attracts attention of players
- The second success factor for picking a perfect scene is to ensure the ad does not interrupt the flow of the game Mike gave an example of Commercial Cliff Hanger In the Commercial Cliff Hangers model ads interrupt the content at the peak of the crisis, when we are the most engaged with the movie or a game This ensures the viewer stays glued to the screen to wait for the resolution of the crisis Players hate that and that will be reflected in your app store reviews
- STARS model encourages you to show ads at natural breaks, when players rest after particularly intensive challenge or are bored and waiting for resources to be replenished Since all ads are opt-in, this is the time when players are most likely to take a break and voluntarily choose to watch an ad
- Finally, the scene should be a place where we can provide the most value to the player In Zombie Highway 2, after a player is killed, they can watch an ad to rewind a game by three seconds and try to complete the level again This is a perfectly designed scene The player died and a little bit of a break helps to regain focus for the next attempt The value exchange is contextually very relevant
- Next, let’s talk about triggers Triggers are cues for players to take action Since all ads are opt-in, we need to remind players that they can benefit from watching and ad and triggers do just that There are two types of Triggers: external and internal
- External triggers are buttons or other visual cues that remind player to take action. They need to be visually attractive. Good triggers also inspire curiosity, they make us wonder what’s behind them. What will happen when we click them. George Loewenstein has described Information Gap Theory. When we see a gap in our knowledge, it gives us a feeling of deprivation, it’s like an itch we want to scratch. We want to know the answer to our question. Tap Titans brilliantly leverages this in their placement. In the beginning, the fairy brings only rewards. They create an expectation that when you click on a fairy, a reward will be given. As the game progresses, the behavior changes: now the fairy randomly offers some rewards and some other rewards require player to watch a video ad It attracts curiosity: you want to know what she will bring this time The variable aspect of the rewards she brings also has significant impact on the engagement rate. People love variable rewards. When we anticipate pleasure, dopamine is released in our brain and we feel happy. This effect has been exploited in the design of slot machines in Vegas (add details)
- Internal triggers are emotions, we are driven to seek pleasure and avoid pain In games, two emotions you can target are boredom and frustration Boredom is an excellent trigger in a game (waiting time, loading time) and ads can help keep players entertained as they way for a level to load. They can also be used when a time-based freemium mechanic introduce a delay in a game that can frustrate players. As in the Zombie Catchers example before, using video to allow players to come back to the game without waiting increases both monetization and engagement. Opt-in rewarded video can also be used to relief frustration for players. If a player lost many times, the best way to re-engage them is to give them rewards that help them progress in the game. The value exchange is relevant and weaker players can progress forward and stay engaged.
- Source: study by Kiss Metrics
- If you are asking people to watch an ad, the experience must be really good. There is no place to compromise. Look out for five things: Performance (ads): is the speed of playback good, do you see buffering? Quality: make sure the SDK is stable and doesn’t crash your app Design: make sure the ads are all in high-definition and end cards and other elements of the ad unit are well designed Fill: are you getting ads for every impression Relevance: high Conversion Rate means the ads served are actually relevant and bring value to the players
- There are three types of rewards you can give to the players: Social rewards: make us feel accepted, attractive, important and included. Access Rewards: provide access to unique content or areas of the game Progression Rewards: help players progress in a game, such as currency, resources or energy and lives
- Social rewards include elements that increase status of the player in the community. They can include social gifting as well as customizations to the player avatar, etc. This reddit poll shows that 38% of dota players have spent $80 or more (sample size ~14000). Those are insane LTVs that any studio would kill to have. Part of this is due to the huge retention they have of users, but another is that it gives you a WAY to spend money almost infinitely. If you're already at the top of the top, what do you have money to spend on? Outfits. If you have no friends to compete against, what are you going to spend money on? Self-expression and status, give them ability to customize characters
- Players love to have access to unique areas of the game and love to discover and unlock new content. This has taken the form of Easter Eggs hidden in games This Finally Fantasy IX, Nero Brothers quest, was only discovered in 2013 after 13 years What’s more interesting, is that players have been exploring the game and looking for hidden content even 13 years after its release Access rewards can directly provide access to those areas and the unique content or they can provide hints for players to find Easter Eggs
- Three key levers that can be used to enhance the value of rewards Scarcity – explain why Luck (variable reward) – explain why Require significant effort – explain why
- You want to plant a seed, for players to come back and engage with ads in the future and maybe even spend money on IAP The key idea is for the reward to move players towards the object they want, but don’t necessarily provide complete value We have a need for completion, if you structure rewards as a set, people are more likely to come back to complete them (explain the need for completion) Endowed progress effect (explain how it can help to increase further engagement with ads, but also to get people to spend money on objects)
- - Explain the model again
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