King Digital is bringing back ads into its games, four years after deciding to remove them. Mobile game developer considered previous model of serving in-game ads as disruptive and believed players perceive ads as a pure roadblock that stands between them and further progress. Earlier this year, the developer partnered with Nestlé SA and Visa Inc. to bring this new, optional format of ads into their games, which Wall Street analysts predict will net them $1 billion of revenue by the year 2019. Following King's example, many mobile developers made the switch from forced to optional ads, a move which is set to bring in $39.8 billion of ad revenue to the mobile games industry this year.
The global shift in mobile gaming space is not unjustified. Many players and developers believe serving an optional ad with a reward behind it, whether it's extra in-game currency or lives, is a much more engaging experience than having the ads enforced upon the players, halting their progress without offering any compensation. Of course, in-app purchases are still a big generator of revenue for the developers, but they're dependent on a rather small minority of big spenders who are dedicated to the game. Serving "rewarded ads" is more viable for developers, especially up and coming studios whose games lack the exposure of titles produced by EA, King or Gameloft. Looking at the charts, among the 50 top grossing games on Google Play Store, almost 80 percent of them serve ads to their players. Majority of developers (62 percent of them, according to Unity Technologies research) not only support adding in-game ads, but claim players' retention raised once they made the shift to video ads that give out rewards to players.
Advertising in mobile games proved to be lucrative for many companies, but it's still a sensitive subject for the consumer, being an annoyance if the ad seems like it's wasting their time. Zynga's introduction of rewarded ads in 2016 helped increase their revenue and King Digital is also seeing a rise after they introduced them. The mobile game market might have found a solution for the diminishing player retention and, according to analysts, the market should see a significant rise in the revenue during the upcoming year.