Rewarded Video Trending Up

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The advertising industry in recent years has evolved to a point completely unrecognizable from where it started decades ago. With rapid developments in technology over the years, advertising has also had to adapt in an effort to keep up with these rapid changes, particularly with regards to mobile technology. These developments, combined with the drastic increase in mobile users, has inevitably led to an onslaught of new mobile advertising formats and opportunities. One of the most popular among these formats is interactive advertising, in which consumers are rewarded with something in exchange for interacting with the advertisement. Chief among these ads is the rewarded video, which has proven itself to be an immensely valuable asset, particularly in mobile entertainment apps. Rewards can include an extra life in a game, an extended free trial, game currency, and a plethora of other rewards that provide value to consumers. In the following paragraphs, we’ll go into further detail regarding the specifics of rewarded video, the benefits of including one in your advertising portfolio, and what it can do for your brand to cut through the noise of mobile advertising and increase your revenue.

What is a rewarded video?

A rewarded video is one that a user can choose to watch in exchange for a measurable benefit and can provide significant value to consumers of mobile entertainment brands and apps. If a viewer clicks on the ad, the publisher then redirects them to a set URL, such as a website or a custom post-click landing page. They are then offered a reward for the time spent watching the video, providing value to the consumer and revenue to the advertiser and publisher. Further, rewarded videos allow mobile developers to monetize their apps while ensuring that user engagement is high and IAP revenue increased. Going one step further than regular video advertising, the inherent opt-in nature of rewarded video ensures an enhanced advertising experience that consumers willingly choose to engage with, something that oftentimes can be quite atypical. Although the nature of rewarded video means they are most typically used in games or entertainment apps, they are not mutually exclusive to those niches. Rather, they can be leveraged for other uses and placements and not all are exclusive to mobile devices.

Think for example of Spotify, which has both desktop and mobile versions. Spotify offers two options, a paid version that comes with no ads and a free version, in which users have the option to watch one video ad in exchange for 30 minutes of uninterrupted music. This is a non-game example of a rewarded video ad, in which the rewarded video presents the benefit of a premium subscription (no ads) but without a monetary exchange between the listener or user and the business. Countless games are also good examples of rewarded video, in which players watch an ad in exchange for jewels, money, extra lives, etc. in the game. Chances are that most people have at some point in time willingly engaged with a rewarded video ad in exchange for the offered benefit it provides and enjoyed the experience.

What are the benefits?

Now that you know what a rewarded video is, you might be asking yourself if it’s a worthwhile investment. Below are several impressive success rates that may help to answer this question:

  • 71% of players prefer in-game rewarded video ads over paid apps or in-app purchases
  • 54% of players specify that rewarded videos are their in-game video ad of choice
  • 62% of players regularly engage voluntarily with rewarded videos
  • 62% of app developers saw retention rates maintain or increase following the introduction of rewarded video to their apps
  • 52% of mobile game developers reported rewarded video ads as their most lucrative form of in-game advertising on a per user basis
  • 86% of mobile developers integrating rewarded ads into an app or a game with existing IAP reported that in-app purchasing remained the same, or in some cases even climbed

It’s evident that there are benefits for brands, consumers, advertisers and developers alike with rewarded videos, making it an enormously beneficial investment to add to your advertising portfolio. Below we highlight some of the biggest benefits.

  • Ability for consumers to choose when to watch a video ad, never auto-playing, making it one of the least invasive forms of video advertising available
  • Users receive rewards for watching the ads, ensuring a positive user experience
  • Lower prices for apps or fewer in-app purchases, ensuring the user buys features and benefits with their time and attention as opposed to a monetary exchange
  • Higher user retention rates, with users less likely to become annoyed and delete the app when they’re able to watch a video in exchange for something of value to them
  • Increased ad revenue, with rewarded video not only increasing overall ad revenue but also providing on average one of the highest eCPMs largely due to the fact that impressions are delivered to users that expect to view content, rather than being surprised by it
  • Higher conversion and IAP spend due to the fact that, after gaining premium content through rewarded videos, a greater volume of players become willing to make in-app purchases after sampling premium content and qualifying its value
  • Higher completion rate of ad views since the user isn’t rewarded unless the ad is viewed in full
  • Higher viewer satisfaction due to the opt-in nature of rewarded video ads, which makes them non-intrusive to consumers. As a result, consumers tend to view the advertiser behind rewarded video ads more favourably
  • More app downloads in general as if an app is free and earning money from rewarded video, there is less of a barrier for the initial download meaning that more users can download the app in the first place

Do they come with any disadvantages?

Although the advantages of rewarded video drastically outweigh the disadvantages, it would be misleading to insinuate that they are completely perfect. In order to paint a well-rounded picture, read on to learn more about the potential scenarios in which a rewarded video may not be the best format for a particular brand or product and how a brand can pivot their strategy to maximize returns.

  • Potential for low quality traffic or low user engagement since it can sometimes be the case that users are only watching the video passively for the reward and are therefore not overly invested in the ad’s content. Therefore, in order to ensure your rewarded ad hits home, it’s imperative your messaging is concise and simple so that consumers take away your key message even if only watching passively
  • Lower lifetime value of users, in that often users who download an app just for the reward won’t hold a vested interest in staying active on the app for a prolonged period. Brands can counter this by refreshing their advertising content on a regular basis to prevent creative fatigue and by regularly offering new value or rewards to consumers
Is rewarded video for you?

Now that you know more about what a rewarded video is and the benefits they offer, you’re in a better position to determine whether it’s the right investment for you. Generally speaking, rewarded video can be used for any app but tends to be most effective in mobile games with free-to-play elements. Therefore, if you’re a developer of F2P games, it’s very likely that the addition of rewarded video would benefit you greatly.

However, even if you aren’t a developer or advertiser of a F2P game, that’s not to say that rewarded video ads aren’t for you. They’re a great format for introducing users to premium content in a way that enables users to qualify that value for themselves. By using rewarded video ads to show users what they could get with a more premium and/or paid version of your offering, you increase the likelihood of consumers choosing to spend money on your product(s) in the future.

Lastly, if you already make use of video advertising in the form of interstitial placements, offerwalls, etc. it’s an easy transition to a rewarded video format to provide a more enriching user experience that will enable you to reap all of the benefits outlined above, while providing value to your consumers.


Get in touch

In today’s advertising market, it’s imperative that advertisers and brands make strategic choices regarding what ad formats to leverage that will provide the best returns and rewarded video ads are a great option. The numerous proven benefits they provide, combined with the overall positive user experience, make them a non-intrusive and worthwhile investment that generates one of the highest dCPMs in the industry. Whatever your niche, todoMobile can help you learn more about rewarded videos and how they can be incorporated into your advertising strategy in a lucrative way.

If you’re interested in learning more about rewarded videos or if you’ve decided that incorporating rewarded videos into your advertising portfolio would be beneficial, get in touch with us today. todoMobile can help to bring your campaigns to life by incorporating rewarded videos from the upfront creative development phase all the way through to production, effectively elevating your brand in a way that’s mutually beneficial to both consumers and advertisers.

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