Adapting in-game advertising for a privacy-centric world

Katie Madding, Adjust

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Mobile gaming’s moment is far from over. Adjust data from 2021 shows that sessions, installs, retention rates, time spent in-app, stickiness, and sessions per user per day all increased compared to 2020.

That would be impressive in a normal year, but is especially so considering the enormous growth we saw in 2020 as a result of the first COVID-19 lockdowns. With more eyes on mobile games than ever before, in-game advertising is also an increasingly important part of mobile growth strategies.

A study from data.ai and IDC revealed that mobile games are quickly overtaking the games industry as a whole – predicted to claim about 61% of the gaming market share in 2022 – which is huge considering that the figure was already an impressive 52% in 2021.

With day 30 retention rates consistently higher than day 1 rates (for everything except hypercasual), it’s clear how skilled user acquisition (UA) teams in games are at finding, targeting, acquiring, and retaining their users. More impressively, they are doing this while grappling with privacy changes and distinct post-IDFA challenges on iOS.

Why in-game advertising is booming

When iOS 14 was first announced, average opt-in rate predictions were as low as 5%, but fortunately things are not nearly that dire. The overall industry wide opt-in rate we’re seeing at Adjust is currently 26%.

For games, things are particularly promising, with an overall opt-in rate of 31% as of Q1 2022. If we then break the data down into sub-verticals, we see hypercasual and action both at 39%, and that racing is as high as 40%. For some individual titles, these numbers even reach above 70%.

For games, things are particularly promising, with an overall opt-in rate of 31% as of Q1 2022

With opt-in rates like these, it is no surprise that gaming revenue is on the rise. With consent rates this high, marketers have a lot of data to work with – both in the familiar, deterministic sense, but also to plug into next generation predictive solutions that make analysing SKAdNetwork data sets significantly more granular and actionable.

This makes in-game advertising a particularly compelling option for mobile marketers. In December of 2021, the mobile games market generated $7.4 billion from player spending. Meanwhile, eight mobile games had their biggest ever year in 2021, generating over $1 billion each. If you don’t already have an in-game advertising strategy in place, now is the time to develop one.

Securing the opt-in is an essential first step in any post-IDFA strategy. Once you have a pool of engaged users happy to receive targeted advertising, there are multiple ways to work with the consented device-level data you receive. These are key.

Empower your UA team

One of the main lessons of the mobile games vertical’s success is how important a strategic user acquisition team is to success. UA is a central pillar of mobile marketing, but a move toward automation took the emphasis off creative, data-minded UA teams and onto the use of AI and machine learning.

However, a new focus on user-privacy has meant mobile marketers need to completely revisit their strategies. Agility and flexibility are more essential than ever, which means we can no longer solely rely on automation (although it is an extremely important part of the equation). So it may be time to invest in your UA team and find that balance.

Identify the right conversion events

In a post-IDFA world, success on SKAdNetwork is largely about leveraging conversion values to understand user behavior, measure campaign performance, and optimise for growth.

In short, SKAdNetwork provides space for 6-bits of downstream metrics (a number between 0 and 63), with an initial 24-hour timer. Otherwise known as a conversion value, this can be assigned to any value that can be expressed in binary, and your UA team can decide which events they want to include.

Generally, the key is identifying events that occur within the first 24-hours post-install that are either the key events you track or are indicative of future events outside of this window. For instance, you may find that users who complete several tutorials on the first day are more likely to make a purchase down the road.

The specific events will differ according to the app vertical and unique niche, requiring a UA team with a granular understanding of the audience – and the ability to think critically to identify new key events. Of course, predictive analytics will also play a vital role here, which is why we talk about balancing next-generation solutions with brilliant thinkers.

As with any form of digital advertising, it’s important to match the right ad with the right users – and the right moments in-game

Make IDFV your secret weapon

Mobile game publishers have another advantage over some other types of apps – the Identifier for Vendors (IDFV), which is still available on iOS.

The IDFV is assigned to all apps from a given publishing suite on one device, making it possible to run cross-promotional campaigns. Game publishers often have a large portfolio of games to draw on. As long as an IDFV is passed in a tracker URL, game marketers will have accurate attribution data for iOS campaigns.

Leveraging the IDFV is especially popular in hypercasual games, where apps are cross-promoted at, for example, key churn points to keep the given user engaged in apps from the same publisher.

As a bonus, consent rates for hyper casuals are also comparatively high as users in this space have a natural understanding of the benefit of targeted advertising.

Match your in-game ads to the right users

In-game ads come in many formats. From standard banners and interstitial ads to innovative playable ads to the ever-popular rewarded video ads, the choices are varied. But as with any form of digital advertising, it’s important to match the right ad with the right users – and the right moments in-game or within your user journey.

Your data can tell you which players are more likely to engage with which ads and at what points in the game each ad type works best.

Gaming will continue to adapt to the challenges of advertising on mobile. The key to evolving alongside the industry, as it becomes more privacy-centric, is measurement. As mobile gaming continues to grow, so will competition. Staying ahead of the competition requires close monitoring of your in-game ad campaigns with granular data.

Katie Madding is chief product officer at Adjust, an analytics platform that helps marketers grow their mobile apps with solutions for measuring and optimizing campaigns, and protecting user data.

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