The Importance Of In-App Advertising In Mobile Games

Carlo Indrizzi
October 13, 2023
The Importance Of In-App Advertising In Mobile Games

In the world of mobile games marketing, advertising can be done in very different ways and several distinct monetization models can be employed. One of these models is called IAA (In-App Advertising). In-app advertising aims to connect brands with the people they want to reach by creating engaging and interactive app game ads.


Understanding IAA in mobile games


To understand the significance of in-app advertising, and in particular in-game advertising, it is essential to first get a grip on the underlying mechanisms. In-app advertising operates through intermediaries such as ad networks and ad exchanges, which connect advertisers with game developers.


·         Ad networks are platforms that manage the distribution and placement of advertisements in various games. They help advertisers reach a broad audience across multiple gaming titles and genres.


·         On the other hand, ad exchanges facilitate real-time bidding for ad placements, allowing advertisers to target certain users or user segments within games and publishers to sell advertising space at effective prices.


The two mainly differ in the level of control and targeting they offer: ad networks are ideal for advertisers who are looking to cast a wider net and reach a broad audience. Ad exchanges, on the other hand, provide a more granular approach, allowing for precise targeting based on user data and behavioral patterns.


The two approaches can be combined and sometimes are: in this way, brands can connect even better with the right users and at the right time, amplifying their message in the gaming environment.


Different ad formats and their advantages in game advertising 


In-game advertising offers a rich variety of ad formats, and each of them presents its unique advantages. These formats can be very flexible as well and that allows advertisers to integrate them very easily into the gaming experience, without intruding or disrupting the session like some traditional advertising methods may do.


·         Playable ads: this format offers the best kind of interaction, allowing the user to get a glimpse on a bit of gameplay in first person. This kind of ad has proven to be incredibly resultful in terms of revenue.


·         Video ads: like playable ads, videos are one of the most used formats in app advertising. They have shown great numbers in terms of user’s engagement and retention and they can be integrated with other formats such as playable ads, interstitial ads and SKOverlay technology.


·         Interstitial Ads: this is a kind of full-screen ad that appears at natural break points in the game, for example between levels or during loading moments. They are great in terms of visibility and engagement because gamers tend to be more receptive to these ads during those moments.


·         Rewarded Video Ads: players would be offered the option to watch a video ad in exchange for in-game rewards, like coins, life points, or power-ups, generating a win-win situation for both gamers and advertisers.


·         Banner Ads: these are static or dynamic banners placed at the bottom or top of the screen during gameplay. They manage to maintain constant visibility, even though they result to be less immersive than other formats.


Different ads, different game categories


The employment of in-game advertising varies across different game categories. Here are some facts that shows how different app advertising formats are used in various types of games:


·         In hyper-casual games, such as puzzle or arcade games, interstitial ads and rewarded videos are particularly effective. As a matter of fact, according to some data, rewarded videos can boost user retention by 20% in these games. Video ads and playable ads, especially from those companies that have invested a lot into in-game advertising, are very frequent as well, especially between levels or under the form of rewarded videos.


·         Games belonging to the sport category usually benefit from banner ads and in-game product placements, offering high visibility to brands. In these games, players are more likely to interact with branded items or advertisements integrated into the virtual stadium environment.


·         Interstitial ads and rewarded videos work well in action games. Gamers are more inclined to watch a video ad in exchange for in-game rewards, making this format an effective choice.

·         Banner ads and interstitial ads can be strategically placed in strategy games as well. Again, the low-intrusion aspect of these formats aligns well with the slow, contemplative pace of such games, and actually makes them suitable for basically any type category.


·         Playable ads, video ads, banners and interstitials are all popular choices in simulation games.


Obviously, it always goes to advertisers to adapt to the preferences and behavior of gamers in various game categories when doing in-game advertising in mobile games. Advertisers can tailor their strategies to fit the gaming app advertisement environment effectively if they are able to integrate seemingly and skillfully different ad formats into the same game without ruining the experience of it.




In-app advertising is usually and maybe wrongfully considered the counterpart of another monetization model, based on in-app purchases instead. Both are revenue generation strategies, and, at the same time, they serve different purposes while can also be used in a perfect balance.


In-app advertising in mobile games, as we have already talked about so far, refers to the integration of ads within a game, to offer another game for free or at a reduced cost to players. Its aims are creating brand awareness, engagement, and user retention. In-app advertising may include interstitial ads, banner ads, rewarded videos. Players can enjoy the game without spending money and can also choose to engage with ads voluntarily.


On the other hand, in-app purchases involve players spending real money within a game to enhance their gaming experience. This can include buying life points, power-ups, cosmetic items, or unlocking new levels. In-app purchases open the possibility to players to have gameplay’s enhancements and can help them progress faster. They are a significant source of revenue for game developers and have become prevalent in freemium games.


The main difference between the two approaches lies in their intentions. According to the strategy (IAA vs IAP) there must be a change of optimization for ad networks and DSPs. 

  • An IAA model would need to have a high retention rate, necessary to be able to understand and to target the users that watch a relevant number of ads, as these are the ones that keep playing and are therefore more exposed to ads and generate revenue for game developers. 


If done right, it works!

In-app advertising in mobile games is a powerful model, especially because of the many ways in which it can be done. The existence of several different ad formats gives advertisers the possibility to really get creative and find the best ways to integrate ads into mobile games.


Creativity would not be enough though, as advertisers also must consider strategies that would prevent them from annoying users and abruptly interrupting or ruining their gaming experience. Therefore, it is a very complex process that, if employed correctly, can bring really good results.