Freemium game monetisation needs a format
In a panel discussion at the Mobile Games Forum 2013 titled 'It's all about the money… or is it', some prominent players in the advertising space explained what's working for mobile games and what simply isn't. The Mobile Games Forum is the place for game developers to get in touch with agencies and companies who can bring the advertising dollars from big spenders. But what is really stopping them from doing so?
The market is there
A big part of the discussion surrounded the advantages of mobile platforms over traditional media, mostly television. Limvirak Chea from InMobi highlighted the need to target specific audiences as a first step to convince advertisers of the benefits of mobile. The typical profile of young male who plays games is what comes to mind when you think of the core market audience, but this is evolving as the same pace as gadgets invade the home.
James Salins from Supersonic Ads was of the opinion that advertisers such as household giants Unilever and P&G can tap into more niche audiences such as women using tablets at home. For Google's Jason Morse, it's more about identifying current uses rather that looking for new areas. The average mobile user is bitting time of other entertainment activities such as TV or reading the newspaper on the train to spend more time playing with a smartphone.
Metrics and return
If you are going to convince anyone that your game is a great way to connect with an audience, you need to talking with the same numbers traditional media uses. Of at least the same type of numbers. Companies like Nielsen and Kantar provide metrics, however, most devs are going for non-standard tracking tools to measure performance and lifetime value, which aren't convincing advertisers just yet.
Ian Harper from Future Games of London shared a revealing anecdote, explaining that once they uploaded a blank image instead of an ad on their game by accident, obtaining a similar click through rate than a regular ad. If the metrics used are tracking banners that people are blind to, there's definitely room to use the opportunities of the medium to go more statistical.
James Salins referred to ad effectiveness compared with other channels. Mobile ads being four times more effective than TV and twice as much as online. However, agencies can profile mobile gaming, not understanding the potential for the audience and dedicating less than ten per cent of the digital advertising budget to it.
Formats that nobody likes
The main caveat developers and marketing companies working with advertising agencies seem to be facing is the lack of format flexibility. Brands are aware of mobile but they're conservative as the choice appears to be limited to display branding on the app or cross-promote an app within another one.
When Pocketgamer's Jon Jordan suggested the resistance to advertise on mobile could do with the limited choice of formats, everyone suddenly admitted banner ads aren't great. The overabundance of banners doesn't transform in conversions, requiring a lot of impressions to get one user, while high quality advertisers are in short supply. Of course, banner ads poorly targeted are very annoying for the user and developers struggle to moderate the content that appears on the screen.
Panel chair Gina Jackson from Women in Games Jobs asked about integrating advertising into freemium strategies to avoid feeling like cheating players — using the example of Rovio, who considers customers are always fans. There was some consensus about keeping advertising relevant to the fabric of the game, with in-game rewards for watching ads as one of the popular choices.
Mike Hawkings from Japanese publisher Marvelous AQL mentioned the need to cater to the different type of players that go for freemium titles. Generally, people know that if they get invested in a free game they will eventually be asked to spend money, so it's all about giving them choices. If someone doesn't want to spend, they should be able to have an alternative, such as the video ad mentioned before.
The Mobile Games Forum in London is the leading event in Europe that brings together gaming industry players, anticipating the trends that will shape the market and making partnerships happen.