Ahmet Genc, the business director at HyperBid, a mediation platform specifically developed by GameAnalytics, shared his predictions about changes in monetization models in 2022.
Aside from the obvious ups and downs last year, we also had some big changes in how the monetization industry works. From new models improving revenue for developers to changes on how we can collect data.
1. The waterfall model will take a step back
There are two models you can use when selling the advertising space in your game. Either you use waterfall, which methodically runs through a set list defined by you, until you get an ad bid above your defined floor price. Or you can use in-app header bidding, where you programmatically scan through every bid for the best offer.
Despite waterfalls being the traditional method, header-bidding continues it’s growth into the mainstream. New developers are discovering that header-bidding gives them a much better shot at earning ad revenue from their games, while existing studios are gradually moving over to bidding from waterfalls. In fact, header-bidding is already the dominant model – with 70% adoption by the end of 2020 from 9% market share the previous year (as per App Annie/data.ai).
This is good news for both sides
Developers and ad networks alike should rejoice in this trend. Both sides benefit from in-app header bidding. It means the best bid wins, despite which network it comes from. Higher revenue for developers, fairer auctions for the networks.
2. Privacy concerns will put a focus on first-party data
Last year, Apple made it much more difficult for advertisers to learn about their users. The Identifier for Advertisers (IDFA), which is key in tracking users across different apps to give them more targeted adverts.
Now advertisers have much less data about users. They can’t build up a profile and show targeted adverts.
The future is the data in your game
What can advertisers and developers do to make sure that they’re still showing relevant ads? Use data about the user from within the game.
The absence of IDFA makes the data that you can collect much more valuable and useful. You know which players are most active. Which players are most likely to sit through an ad. Which players are most likely to engage with rewarded ads. You know that based on their history on your game, regardless of how they behave elsewhere. That’s your first-party data.
Because of these changes, we’re going to see a lot more embedded analytics applied in monetization. Game developers are going to need to make sure they link their analytics and mediation platforms together to make sure that they’re feeding accurate, first-party data in.
3. Transparency will be more important to developers
There were a huge number of mergers and acquisitions in the last couple of months in the mediation space. Ad networks and mediation’s platforms often combine into a single entity. Many mediation players also own game studios. As per our survey of the developer landscape, the need for transparency and neutrality behind these highly-aggregated platforms is only increasing.
Studios and publishers want insight into the true workings behind their mediation platform. We’re anticipating the return of more independent mediation platforms, forcing the whole industry to move to a more transparent approach.
4. Indies will ride the monetization wave
The in-game advertising market will apparently reach nearly $11 billion by 2024, according to data.ai. But that growth isn’t only going to come from the existing dominant players. Smaller developers and independent studios now have the tools to break through the noise and get their games out there.
The standard complaint we often hear from newer developers is that they get lost in the noise. Bigger mediation platforms are currently focusing on their biggest client publishers. But in the past year, we’re noticing an increasing number of smaller developers are beginning to monetize their games very effectively, and many even self-publishing
It comes down to ease of monetization. As tools become easier to incorporate, we’re going to continue seeing the surge of indie developers. Mediation platforms need to pay attention to everyone, no matter their size.
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