App Monetization Industry Outlook: Focus Now for Growth Ahead

By Steve Webb, Director, Facebook Audience Network

There’s no doubt that 2021 has brought disruption for mobile game businesses. With iOS updates and the ever-evolving regulatory landscape, most developers have had to adjust how they market, monetize, and measure their apps.

Despite these shifts, there are voices of optimism for the future of app monetization. Industry analyst IDC forecasts mobile in-game ad revenue paid to publishers will increase at a compound annual growth rate of 17% year over year for 2021 and 2022.1

Given the changes for publishers and developers, we took a close look at the future of app monetization, interviewing more than 20 thought leaders in this space. We have brought together both inspiration and practical advice for gaming businesses in a new report, App Monetization Industry Outlook, which covers in detail the themes I’ll highlight here. 

What Does the Future of App Monetization Look Like? 

While many gaming businesses are currently focused on adapting to 2021’s ecosystem changes, here are three areas to start planning for 2022 and beyond. 

2022: Innovation Drives Value for Players and Businesses

Increased Mastery of Monetization Strategy

For game publishers, the accelerated shifts to bidding and a diversified monetization mix that were predicted in 2020 are playing out globally and across platforms. Today, bidding is not just a priority, but an imperative. And now, the value of balancing both in-app purchases and in-app ads is widely accepted. 

While most successful gaming businesses already understand the value of building a balanced app economy into their game, more businesses will shift their teams to combine user acquisition, monetization and development into a single process. Gone are the days of build, then monetize: Monetization is now a factor from the beginning.

As Becky Ann Hughes, SVP Growth at Glu Mobile shared: “In the past monetization was viewed as something you tack on to your content but monetization really should be considered as part of the content.”

Growth of “Instant” Gaming as Mobile and Cloud Converge

Many mobile publishers and developers are already building Instant Games, which are no-download games that still allow for graphically-rich game play. This mobile-to-cloud shift means more value for players – because they can have deeply immersive, cross-platform game experiences.

As Jason Rubin, Facebook VP of Play suggests: “Imagine you can see and try all games right from the same cloud platform -- then download only those you want on your phone. You’d probably play more and spend more in those few games you were able to test and deliberately add to your mix.”

Facebook is making large infrastructure investments to support cloud gaming, to help drive the industry toward frictionless play across mobile, instant and cloud gaming platforms. 

Better Creatives Drive Acquisition

As you grow your game, understanding player motivation can empower development of insights-led creative to attract new audiences. Also by 2022, we'll see more new solutions for measurement and user acquisition. 

Candice Mudrick, Head of Market Analysis at Newzoo predicted: “We’ll see more emphasis on ad creatives, diversifying the channels (e.g. into web), and diversifying marketing away from pure digital into a more mixed model.”

2025: The Future is Immersive

In the metaverse, the opportunities get even more exciting. By 2025, we can expect people to have highly personal engagement with brands and publishers in virtual reality environments that incorporate gaming, entertainment, commerce and social experiences. 

Ben Chen, EVP of Global Developer Relations at Tapjoy, asks us to consider this immersive ad experience: “Instead of test driving a Corvette, you’re putting on an Oculus Quest headset to drive, and then you can download an NFT after as a reward.”

Focus Now for Future Growth

As a gaming business, what are the priorities to focus on now, for future success? While advice abounds, we recommend focusing on three areas: efficiency, engagement and ad strategy.

Optimize Efficiency

  • Test and optimize your SKAdNetwork and ATT implementations
  • Move to bidding / stop managing a complex waterfall
  • Remove as much friction as possible along the app install journey

Increase Player Engagement

  • Build trust by focusing on quality
  • Know your player journey across the app economy
  • Include social features to reach your audience beyond your game

Refine your Ad Strategy

  • Bring together monetization, acquisition and development plans
  • Build non-personalized ad experiences
  • Leverage format innovations

We look forward to working alongside publishers and developers to provide an end-to-end set of solutions that support monetization and growth in a way that’s sustainable for game businesses and players. To adopt bidding now, visit Get Started with Bidding. To grow your game by mastering your in-app ad strategy, visit Supercharge Your Game

Download the full report for more recommendations and industry perspectives: App Monetization Industry Outlook: How Gaming Businesses Can Prepare for Future Growth.

1Source: IDC, Worldwide Mobile In-App and In-Game Advertising Forecast, 2020-2024, December 2020

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