Mobile gaming has undergone a massive transformation. What once began as a niche pastime has now evolved into a global industry powerhouse. With millions of players worldwide and an ever-expanding array of games, mobile gaming has revolutionized how we spend our leisure time and even how people earn from their creative efforts.
A prominent revenue generation method within this booming industry is through in-game advertising. This strategy involves strategically inserting advertisements within mobile games to generate revenue. According to Oberlo, the projected growth of the US mobile ad market in 2024 is expected to rise by 11.1%, reaching $216.4 billion. Though there may be a slight slowdown in 2025, the market is still anticipated to reach $235.7 billion, with an annual growth rate of 8.9%.
If you’re a marketer looking to enter this thriving space, the potential is enormous. The key lies in partnering with a trusted mobile app development company that can help you craft and monetize a successful gaming app. Collaborating with such a company can optimize your earnings while providing users with an immersive and engaging gaming experience. With the mobile gaming industry’s continuous growth, venturing into this space could be a highly profitable endeavor.
In this article, we’ll delve deeper into the primary revenue streams driving the gaming industry, explore the different revenue models, metrics, and best practices for generating ad revenue. Let’s dive in!
What is Mobile Game Ad Revenue?
Mobile game ad revenue refers to the income that game developers and publishers generate through advertisements shown within their mobile games. Many mobile games are offered for free or as freemium options (free to play but with in-app purchases) to appeal to a broad player base. Game developers make money from these games through a variety of advertising methods.
Simply put, mobile game ad revenue is the total income generated from the different advertising channels embedded within the game app. By partnering with a trusted game app development company, you can also start earning revenue from your mobile games.
But how much do games make from ads? We’ll answer that in the next section.
How Much Do Mobile Games Make From Ads?
On average, mobile game apps can generate anywhere between $10 and $200 per day through advertisements. This is a conservative estimate for a game with around 1,000 active users.
However, it’s important to note that the journey to earning revenue from ads often involves challenges such as poor-quality ads, dissatisfied users, and ineffective monetization strategies. To determine how much a mobile game is earning from ads, you can use the mobile game ad revenue calculator.
To calculate individual-level earnings, you can divide the total earnings by the complete count of ad impressions. This result is then multiplied by 1,000, which will give you the game’s comprehensive ad revenue (eCPM).
Formula: (Overall Earnings / Complete Count of Ad Impressions) x 1,000
For a clearer estimate of your game development project, you can rely on the Pixel Genesys calculator to get a better idea of the development cost.
Types of Mobile Game Advertising
Mobile game advertising comes in various formats, each designed to engage players while generating revenue. The type of mobile game advertising you choose can significantly impact how much you can earn. Here are some popular types of mobile game advertising:
- Banner Ads
- Interstitial Ads
- Playable Ads
- Rewarded Ads
- Offerwall Ads
Banner Ads
Banner ads are graphical advertisements displayed within mobile apps, websites, or other digital platforms. These ads typically appear as rectangular banners located at the top, bottom, or sides of the screen. The main goal of these ads is to catch the player’s attention without disrupting their overall gaming experience.
Banner ads are familiar and have been around for quite a while. Their effectiveness depends on factors such as placement, design, and relevance to the player.
By collaborating with Pixel Genesys, a trusted mobile app development company, you can leverage these types of ads to create a game that not only entertains but also generates substantial revenue. Whether you are planning to develop a game from scratch or optimize an existing one, Pixel Genesys can assist you in building a highly monetized mobile gaming experience.
Pros
- Non-Intrusive: Mobile game developers consider the placement of banner ads during the app design process, ensuring that they do not disrupt the user experience.
- Cost-Effective: Creating and maintaining banners is far less expensive compared to other advertising techniques.
- Seamless Integration: Banner ads can be easily integrated with other advertising techniques.
Cons
- Low Engagement: Since banner ads occupy a fixed space and don’t require player interaction, they can be overlooked easily.
- Lower Clickthrough Rates: As a result of the lack of interaction, banner ads typically have a lower clickthrough rate compared to other ad formats.
How Much Money Do Mobile Games Make Per Ad?
Understanding Mobile Game Ad Revenue
Mobile games generate significant revenue through in-game advertisements. The earnings per ad depend on various factors, including ad type, user engagement, and platform. Here, we explore different mobile ad types and their potential earnings.
Banner Ads
Banner ads are one of the most common forms of mobile game advertising. These small, static or animated ads appear at the top or bottom of the screen without disrupting gameplay.
Revenue from Banner Ads
In the United States, banner ads typically have eCPM (effective cost per thousand impressions) rates of approximately $0.38 on iOS and around $0.52 on Android platforms.
Interstitial Ads
Interstitial ads are full-screen advertisements that appear at natural breaks within an app, such as between levels in a game. These ads are designed to capture full user attention.
Pros and Cons of Interstitial Ads
Pros:
- Easily displayed during game transitions.
- High visibility increases engagement.
Cons:
- Can disrupt user experience if not timed well.
Revenue from Interstitial Ads
In the U.S., interstitial ad eCPM rates range from $9.64 on iOS to $10.11 on Android.
Playable Ads
Playable ads are interactive advertisements that let users engage with a short demo of a game before downloading.
Pros and Cons of Playable Ads
Pros:
- Higher engagement due to interactive nature.
- Attracts high-quality users who are genuinely interested in the game.
Cons:
- More expensive to produce.
Revenue from Playable Ads
The cost per install (CPI) for playable ads is approximately $1.98.
Rewarded Ads
Rewarded ads offer players incentives such as in-game currency, power-ups, or extra lives in exchange for watching an ad.
Pros and Cons of Rewarded Ads
Pros:
- Players opt-in voluntarily, increasing engagement.
- High completion and click-through rates.
Cons:
- Some players may ignore the ad content and focus only on the reward.
Revenue from Rewarded Ads
Rewarded ads generate high eCPM rates, reaching $14.16 on iOS and $11.45 on Android.
Offerwalls
Offerwalls provide users with a list of tasks (e.g., downloading an app, completing surveys) in exchange for in-game rewards.
Pros and Cons of Offerwalls
Pros:
- High-value rewards encourage participation.
- Bridges the gap between free and premium content.
Cons:
- Engagement levels are lower compared to rewarded ads.
- Restrictions on iOS limit engagement-based offers.
Revenue from Offerwalls
Offerwalls have the highest eCPM rates, ranging from $240 to $1,670 on Android, depending on the app genre.
Revenue Models in Mobile Gaming
Mobile games use various revenue models to maximize earnings. Below are some common approaches.
Freemium Model
Freemium games allow players to download and play for free but offer premium content, features, or virtual items for purchase.
Premium Model
Premium games require users to pay an upfront fee to download and play, eliminating the need for in-app purchases or ads.
In-Game Advertising (IGA)
This model integrates ads within the game, generating revenue from different ad formats, including banners, interstitials, rewarded ads, and offerwalls.
In-App Purchases (IAP)
Games using this model allow players to buy virtual goods, upgrades, or premium content, increasing monetization potential.
In-Game Advertising (IGA)
The in-game advertising (IGA) model integrates various types of ads directly into the gameplay. These ads are designed to blend seamlessly into the game world, ensuring they don’t disrupt the player’s experience.
In-game ads can appear in multiple formats, such as banners, videos, or full-screen advertisements. They offer a strategic way to generate revenue without requiring players to make direct purchases.
Considering in-game ads as part of your monetization strategy is essential. This approach helps maximize revenue from players who might not otherwise spend money within the game.
In-App Purchases (IAP)
The in-app purchases (IAP) model allows players to buy virtual items, coins, or special abilities using real money. This monetization strategy is common in free-to-play games, providing an alternative revenue stream.
If you’re developing a mobile game and want to incorporate this strategy, an experienced mobile app development company like Pixel Genesys can assist in implementing it successfully.
Common Abbreviations in Mobile Game Advertising
When dealing with mobile game advertising, several acronyms frequently come up. Understanding these terms can help you optimize your monetization strategy.
CPM (Cost Per Mille) CPM measures the cost of an advertisement per thousand impressions. Advertisers pay a set fee for their ad to be displayed a thousand times, regardless of user engagement.
CPI (Cost Per Install) CPI calculates the cost of acquiring a new user who installs a mobile app. Advertisers pay only when a user successfully installs the app through their campaign.
CPC (Cost Per Click) CPC refers to the cost advertisers pay each time a user clicks on their ad. This model ensures that advertisers are charged only when users engage with their advertisement by clicking on it.
CPA (Cost Per Action) CPA, or Cost Per Action (or Acquisition), determines the cost incurred when a user completes a specific action, such as making a purchase, filling out a form, or subscribing to a service. Advertisers are charged only when users perform the targeted action.
ROAS (Return on Ad Spend) ROAS evaluates the effectiveness of an advertising campaign by comparing the revenue generated to the advertising costs. Expressed as a ratio or percentage, such as “5:1” or “500%,” it indicates that for every $1 spent on advertising, the campaign generates $5 in revenue.
Understanding these metrics allows developers and advertisers to fine-tune their mobile game advertising strategies, ensuring maximum profitability and efficiency.
Best Practices for Generating Ad Revenue
Generating ad revenue requires a strategic approach that balances monetization with user experience.
Here are some best practices for generating ad revenue effectively:
1. Choose the Right Ad Formats
Select ad formats that align with your app or game and enhance the user experience. Common formats include banner ads, interstitial ads, rewarded ads, and native ads.
2. Implement Ad Mediation
Use ad mediation platforms to maximize fill rates and eCPMs by accessing multiple ad networks and demand sources. This helps you find the best-performing ads for your audience.
3. Ad Placement Matters
Carefully place ads in non-intrusive locations. Consider natural breaks in gameplay or transitions between levels to display interstitial or rewarded ads.
4. Frequency Capping
Implement frequency capping to limit the number of ads users see in a given time frame to prevent ad fatigue and irritation.
5. Ad Relevance and Targeting
Ensure that ads are relevant to your audience. Use user data to target ads effectively, which can enhance engagement and click-through rates.
6. Ad Creatives
Create visually appealing and engaging ad creatives. High-quality images, videos, and compelling ad copy can significantly impact click-through rates and user engagement.
7. Rewarded Ads
Implement rewarded ads strategically. These ads provide value to users and can lead to higher engagement and user retention.
8. Ad Load Times
Optimize ad load times to minimize any impact on the user experience. Slow-loading ads can frustrate users and reduce retention.
9. Compliance with Regulations
Stay up-to-date with privacy regulations, such as GDPR and CCPA, and ensure your ad practices comply with these rules.
10. Diversify Revenue Streams
Don’t rely solely on ads for revenue. Explore other monetization options like in-app purchases, subscriptions, or premium versions of your app.
11. Optimize User Engagement
Focus on keeping users engaged with your app or game through regular updates, new content, and community-building features.
Bottom Line
As we’ve seen, the future looks bright for the US mobile ad market, with projections pointing to substantial revenue growth. This underscores the strength and promise of in-game advertising as a revenue source, even in the face of changing market conditions.
As mobile gaming keeps evolving, so will the methods for boosting ad revenue. Developers will have to find the right balance between making money and ensuring gamers have a great experience.
Ultimately, the financial success of mobile games through ads hinges on delivering content and ads that truly connect with the discerning gaming audience.
As an on-demand app development company with vast experience in game development and monetization methods, Pixel Genesys can help you achieve your revenue goals by developing your dream game project.
