There is a steady increase in the number of mobile game players in the past few years and it continues to grow even today. Approximately 2.4 billion people from around the world play mobile games as per 2019 records. It is all set to cross 3 billion by the end of 2021, according to market researcher Newzoo.
Almost everyone around the world uses a smartphone. With the upcoming 5G network this year, there are many benefits to look forward to. Firstly, it will become much faster to download games and hence, the performance of the device battery is enhanced. Secondly, players can make the most of the popular game genres such as real-time, combat, etc. due to better connectivity. It is a fact that the majority of mobile games are free to download in app stores and this forms the basis for their popularity. There are hundreds of thousands of such apps which are readily available for players from around the world on Google Play Store and Apple App Store. From puzzle games to matching 3 similar props and simulation, the needs of diverse mobile gamers are addressed.
Let us now come to gaming companies. They have a whole team of developers, designers, artists and marketers that is involved in producing a game. There is a lot of work that goes into market research and analysis so as to create a game that is relevant to the target audience. This requires a substantial amount of investment. So, how do such gaming companies get their returns if they offer free downloads?
To understand this, we need to define in-app games.
What are in-app games?
In the informal gaming language, in-app games are those that are free to download and have in-app purchase stores for the benefit of the players. In these, players can buy extra lives, boosters and special powers that can help them get past difficult levels. Some apps unlock special levels when players make the relevant purchases. Such goods and services can be purchased easily using any of the myriad payment solutions enabled. There is no need to go out of the app to complete the transaction.
Gaming companies make money from their in-app stores and in-app advertising. According to reports, app-install ad revenue is estimated to grow to more than $70 billion by year-end 2020. As per the numbers mentioned earlier, the number of people playing mobile games is growing steadily. The time that they spend playing is also increasing. This leads to higher chances of gaining income from advertising.
How does in-app advertising work?
Third parties showcase their products/services in other games so as to gain visibility. The trick is to display/play ads that are contextually relevant. This will engage the players and encourage them to watch the ads being played. There are two types of in-app ads – interstitial and rewarded. The first one relates to those that are played in between levels (both when a particular level is completed successfully or not) and the second one offers specific incentives to players.
As far as the payout is concerned, certain actions by the players (clicking on the ad link, watching the ad, etc.) can help developers get the predetermined amount.
Why are advertisers eyeing in-app games?
Most of the players from around the world prefer games that are free to download with in-app purchases. These are the ones that have taken the mobile gaming industry to such heights. As far as advertisers are concerned, whether it is targeting a particular location or audience; these games are effective in reaching out to the users better. If they like certain products/services being advertised, they can click on the link immediately and download it. Therefore, advertisers can make the most of the available prospects in such a marketing strategy. As compared to other online gaming avenues, mobile games are preferred because of their accessibility.
Another benefit is an increase in game revenues. In-app advertising can be combined with other marketing strategies without any hassles. The availability of a number of such formats is yet another advantage for advertisers. All these puts together make mobile gaming an ideal market for advertising products/services so as to reach a larger demographic.