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Thu, Oct

Monetizing Mobile

Business
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Last week, I spoke with Ben Chen and Emily McInerney of Tapjoy. Tapjoy provides a platform that serves rewarded video advertisements for mobile applications. The advertising platform is used by the world’s largest game makers and is the de facto leader in the rewarded video market space.

The software is implemented at certain checkpoints within a game, and serves an advertisement, usually full screen video, in exchange for some form of user progression, often in-game currency. Tapjoy is “additive to their current revenue stream, but does not cannibalize their in app purchases,” said Chen.

Many mobile games have in-game transitions that make logical sense for a commercial, similar to TV shows; “for example, in turn based games at the end of the level,” said Chen. Tapjoy can also make ad slot decisions based on user data; for example, Tapjoy can be partitioned to only show ads if the user is a few coins short of a progression checkpoint. 

Tapjoy has been around since 2009 and helps developers monetize outside of direct user payments. “Developers start to realize that only 1-5% of users are engaging in app purchases … but they still want some return for acquiring those users”, said Chen. Tapjoy primarily focuses on the mobile gaming market, but their ad unit makes sense in other gamified applications such as Tinder. 

Based on a study by Tapjoy, of the top 300 apps by payment and operating system, 69% of them use rewarded video advertisements. Most consumers are welcome enough to these ad units, in the same way they are to DLC’s. “For specific age groups, mobile games are as relevant as TV was,” said Chen. And, this form of media has to be supported economically in some fashion. Rewarded video gives users a method to earn in-game progression, and provides developers a monetization avenue.

During our meeting, I brought up the topic of mobile maturation, and wondered if the market was at its peak. And though the market is maturing, mobile games are by-and-large the dominant form of media on phones. “Though the market has matured, it doesn’t mean users are going anywhere.” In juxtapose, Hollywood has existed for close to a century, but movies will never go away. 

Tapjoy provides clever product for developers to monetize non-paying users. It’s inlaid onto a full service software that interprets data to best serve ads at appropriate times. Its versatile technology allows any interactive form of media entertainment, whether mobile or not, to monetize effectively.