Exploring rewarded videos: A comparative analysis of hypercasual games and other genres

August 2 · Nick Schultz · 5 Min read
Rewarded videos offer players a choice-based option that engages them and provides valuable gameplay benefits. And here's the best part: they are a powerful monetization tool. A win-win. 
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At a time when we often find ourselves at the mercy of videos we’re forced to watch (looking at you, YouTube), a refreshing alternative has gained popularity in the world of mobile gaming. 

Rewarded videos offer players a choice-based option that not only engages them but also provides valuable gameplay benefits. And here’s the best part: they are a powerful monetization tool. It’s a win-win. 

Read on as we uncover the distinct approaches to rewarded videos for different game genres, focusing specifically on hypercasual games with comparisons to casual, puzzle, idle, and midcore/hardcore genres. Understanding the differences is crucial for any developer and advertiser looking to optimize their strategies and maximize revenue.

Let’s dive in. 

Hypercasual games: Maximizing revenue and engagement

In hypercasual games, advertising revenue reigns supreme. In-app advertising (IAA) dominates, accounting for a significant portion (90% to 99%) of income. 

Rewarded videos play a crucial role in this genre, providing publishers a means to maximize revenue while enhancing user engagement. By integrating incentivized videos, users are motivated to prolong their stay in the game, resulting in increased retention rates and higher revenue generation. 

1. Experimenting with ad placements 

Multiple video ad placements are common in hypercasual games, allowing for ample experimentation. Developers can test and fine-tune various rewarded video ad placements, assessing their impact on user engagement and retention.

2. The role of frequency: Rewarding engagement

Hypercasual games tend to have a higher frequency of rewarded video ads compared to other game genres. This approach strikes a balance between monetization and positive user experience.

3. Enhancing user experience with unique ads 

Hypercasual games offer unique types of rewarded video ads that are less commonly found in other genres. These include “skip app levels” and “remove ads,” which focus on enhancing user experience and retention. 

4. Optimizing ad types

Developers in this genre face the challenge of implementing different ad types while avoiding cannibalization of other ad formats. Getting this right ensures optimal revenue generation without compromising user experience.

However, in a recent shift from hypercasual to hybrid-casual games, the dynamics have become more complex with a blend of in-app purchases (IAP) and IAA. This evolution has brought about new dynamics in the use of rewarded videos. 

Casual, puzzle, and idle games: The art of effective monetization

In casual, puzzle, and idle genres, developers typically consider about a 50-50 split between IAP and IAA. Utilization of rewarded videos is driven by how many can be used to effectively monetize a game before positive user experience is affected. 

1. Finding the sweet spot: Limited frequency 

In casual, puzzle, and idle games, the frequency of rewarded videos is typically kept at a lower level compared to hypercasual games. This approach is a delicate balance between ad placement and mitigating the risk of damaging IAP revenue. 

2. Engaging and retaining players 

The primary focus in these game genres is to increase engagement and retention not only through rewarded videos but also IAP. The ultimate goal is to create a harmonious synergy that drives revenue and ensures player satisfaction. 

3. A targeted approach: User segmentation and profiling 

Given higher user lifetime value (LTV) and loyalty in these genres, the implementation and optimization of rewarded videos often rely on user segmentation and profiling. For instance, ads may be shown after reaching specific milestones, depending on various conditions. 

Midcore/Hardcore games: Loyalty, retention, and revenue generation

In midcore and hardcore games, rewarded videos generate a smaller portion of revenue (10% to 20%) compared to other monetization strategies. These games have a distinct user profile characterized by higher loyalty, retention, and LTV. 

1. Even more limited frequency for hardcore games

As games move toward the hardcore end of the spectrum, the frequency of rewarded videos decreases significantly. This avoids disruption of intense gameplay experiences, which could result in loss of paying users. 

2. Boosting engagement and conversions: Ad placements and IAP

Developers should consider the number of ad placements and the potential impact on IAP revenue. The objective is to enhance engagement, retention, and IAP conversions, all while ensuring occasional opportunities for rewarded videos. 

3. Tailoring the experience: User-centric implementation

Due to the higher LTV of users in midcore and hardcore games, user segmentation and profiling plays a big role. A tailored approach of showing ads only to non-paying users or providing in-game hints for puzzle, trivia, and word games matches the preferences and behavior of the target audience.

While hypercasual games rely heavily on rewarded videos for revenue generation and user retention, other genres are better served adopting diverse approaches that strike a balance between IAP and IAA revenue streams. Understanding these nuances is essential for tailoring rewarded video strategies and optimizing monetization while maintaining an enjoyable gaming experience for players. 

A key principle of success is placing ad quality and user experience at the center of your ad monetization strategy. By prioritizing these elements, you can engage players, drive revenue, and position your mobile gaming venture for growth. 

Delivering exceptional ads that integrate with the user experience is the path to long-term success.