Why You Should Be Using Rewarded Video Ads

Mobile advertising is not static; it constantly evolves to include engaging new forms that seek to drive revenue and growth for both publishers and advertisers. Rewarded video advertisements are important to any mobile game’s growth strategies. Players watch an in-game video advertisement and receive rewards, such as virtual currency, bonus items, or access to premium features.

What is rewarded video? 

Rewarded video ads give app users incentive to view the ad: If they view it, they’ll receive a bonus feature or a benefit of the game, such as an extra life or game currency. Rewarded ads come in many forms – they can be full-screen interstitials, interactive ads, and so on – but video is a popular choice among advertisers, app developers, and users.

Publisher benefits: Why use rewarded video ads? 

The value exchange works only if the rewarded ad is high quality – relevant to the user, audience-appropriate, and fast loading. These ads are not only tolerated but welcomed by mobile gamers. Emarketer finds 54% of mobile gamers prefer rewarded ads to banner ads or takeovers, and 50% of mobile gamers like rewarded ads in general. Among Gen Z gamers, 61% enjoy taking advantage of rewarded ad offers. Studies also show mobile gamers who watch rewarded video ads are 600% more likely than other gamers to make an in-app purchase. 

Rewarded video ads can increase your app retention rate four fold. Users who watch these videos are four times more likely to make an app purchase than those who do not. Since the ad format encourages users to initiate the action themselves, click through rates tend to be much higher as well.

Mobile gamers are willing to regularly give 30 seconds of their time mid-play to a rewarded ad – video rewarded ads have a completion rate of nearly 100%. That level of willing engagement is of great value to advertisers, who will commonly pay 55 times more per impression in rewarded video than in banner ad formats.

Types of rewarded video 

Virtual currency: Some free mobile games offer players virtual cash they can use to purchase in-game bonuses and virtual accessory items. Players get virtual currency from each rewarded video ad impression. This motivates them to watch ads during every game session and earn additional rewards. 

Gameplay bonuses: Playable ads are interactive, short mini-games that highlight a specific aspect of a mobile game. Early level playables and game tutorials are common examples of these highly effective video ads.

Music and video streaming ads can be used on both shopping and entertainment sites:

Shopping: Ecommerce and shopping apps offer coupons to users who view a short rewarded video ad. These coupons (or rebates) usually have an expiration date. They’re most commonly used in instances where app publishers already have a direct established relationship with advertisers. 

Entertainment: Playable ads may hint at or tease additional gameplay features that can level up a user’s experience. Story games can offer users a new plot twist, while puzzle games hint at new game mechanics.

Incentivized ads go beyond gaming

Rewarded video ads are often found in mobile games, but they can also be successful beyond the realm of gaming. In an IAB study, successful uses were found for rewarded ads, including:  

Music unlocks: Earn ad-free listening

Shopping discounts: Unlock discounts and coupons

Dating profile unlocks: Get access to more potential matches

In-game rewards: Score bonus game lives

Book chapter unlocks: Read free book chapters 

Editorial unlocks: Read free articles

Social emoji rewards: Earn new emojis

Challenges of in-app advertising

Rewarded video ads play an exceptional part in an app’s revenue strategy, users give these ads their attention from beginning to end, and there’s no room here for app publishers to take chances on possibly serving low-quality or inappropriate ads. It’s easy for bad ads to push a publisher off of that tightrope. 

In  GeoEdge study, 78% of app publishers say they’ve seen ads in their apps that could damage their reputation, 93% said bad in-app ads led users to leave the app negative reviews in the app store, and 71% said low-quality ads drove users to uninstall their app. High-quality rewarded video ads provide a major boost to engagement and CPMs. Low-quality ads do the opposite. App publishers can’t assume there’s a broad and safe neutral ground in between. Upholding ad quality standards is a requirement to benefit from these formats. 

How to drive more rewarded video ad revenue: 

  • Use in-app bidding
  • Ensure safe and engaging advertisements 
  • A/B test a variety of placements
  • Segment users

Rewarded video ads best practices

To uphold those standards, app publishers need to think about what makes a bad in-app video ad bad. Part of that requires an understanding of the audience’s expectations in that specific app environment.  A bad in-app video ad is one that causes issues with operation, content, or security. Here’s what those issues can look like:

  • Operation: Video ads are complex, and include multiple varieties of the creative for multiple settings and environments. If the wrong version renders, it could take too long to load, fail to load, appear visually unappealing or unintelligible, or take the user out of the flow of app content for too long.
  • Content: Inappropriate or offensive ad content alarms users and breaks their attention from the app content. That alarm can turn into churn. Ad content may be inappropriate because it’s miscategorized and fails to align with app content – and that miscategorization may be an intentional move on the part of a bad advertiser.
  • Security: Scammers and malvertisers in the ad ecosystem deploy attention-grabbing, often salacious ads – including clickbait creative and misleading product offers – to lure users out of the app and onto an unsafe landing page that contains a phishing scheme, a gift card scam, a prompt to download malware, or other unsafe and unverified content.

Create a better ad experience with rewarded ads

It’s necessary for app publishers to verify the ad quality of rewarded video creative. But that poses challenges: It often requires a great deal of manual work, consuming the business’s resources, slowing time to market, and damaging the bottom line by leaving potential revenue on the table. Working with a partner who is entirely focused on ad quality can greatly lighten the load, by verifying all advertisers, providing QA checks at various points along the supply chain, and helping to customize categorization of ad and app content.

Rewarded video ads perform extremely well in app, and advertisers will pay top dollar for them. To ensure quality advertisers get access to this valuable inventory and untrustworthy advertisers stay out, app publishers should look to ad quality tools that automate QA processes, reduce reliance on manual resources, increase efficiency, increase revenue, and ultimately not just uphold but improve ad quality standards. Create a better ad experience with rewarded ads

Alisha is a Technology Writer and Marketing Manager at GeoEdge. Her writing focuses on current events in the AdTech ecosystem and cyberattacks served through the digital advertising supply chain. You can find Alisha on LinkedIn to discuss brand building and happenings in AdTech.

Malvertising, the practice of sprinkling malicious code into legitimate-looking ads is growing more sophisticated. GeoEdge’s holistic ad quality solution has you covered.


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