Smartphone users access a massive amount of information on their
devices. Studies show that in Q1 of 2019, the average smartphone user
spent roughly 4.2 hours each day accessing the mobile web. With people
spending so much time on their mobile devices, it has become harder than
ever for advertisers to gain exposure using traditional ads. The
question now is how to effectively gain attention from mobile users and
raise conversion rates while also ensuring an enjoyable user experience
on mobile platforms.
Allow us to introduce rewarded video ads -- the perfect solution to this
What are rewarded video ads?
Simply put, rewarded video ads are an immersive video ad format that
lets app users opt-in as viewers in exchange for in-app rewards. Widely
deployed in mobile games, this format integrates video ad content with
actual game scenarios, making each ad a task that a player can complete
to gain an advantage or benefit. By stimulating and fulfilling users\'
needs as gamers, rewarded video ads have become a highly effective way
to attract their attention and generate value.
To understand why these new ads have become so influential in the mobile
gaming world, it helps to know more about the key factors driving their
A promising global trend
With moving visuals and audio elements, video ads convey far more
information than static image ads when displayed for the same length of
time. Meanwhile, users who watch the ads to completion are usually more
interested in clicking by the time they finish, raising the likelihood
of conversion. An additional benefit is that this group of users has a
higher customer lifetime value, as they are more likely to return to the
game and make purchases again in the future.
As 4G coverage expands, short video technologies and platforms are
developing rapidly, making it easier to produce and distribute video
content. Since 2016, the overall proportion of expenditure growth on
mobile video ads has nearly doubled, establishing video ads as a global
A win-win situation for users and developers
Rewarded video ads have broken the traditional rules of advertising in
unexpected ways. Rather than the one-way information flow that
characterizes traditional ads, rewarded video ads give users the option
of becoming active viewers, rewarding those who choose to do so.
The core framework of this model is that developers use video ads to
monetize while transferring some of the revenue they earn back into
in-app rewards for the users who watch them. Giving viewers a sense of
choice enhances the user experience, instead of forcing them to watch
something against their will. For advertisers, this element of user
satisfaction is the key to gaining deep conversions. Data from Pangle
shows that rewarded video ads tend to generate 4 times higher CTR rates
and 3.6 times higher CVR rates than other ad formats.
Rewarded video ads also have the advantage of fitting natively into the
game itself, becoming part of the overall game experience without
disrupting user flows. By integrating these ads, developers can
encourage users to spend more time in the game and motivate in-app
purchases. Data from Pangle shows that after viewing rewarded video ads,
players spent an average of 20%-30% more time in-game, while retention
rates rose by 15%-20%.
A new game ecosystem primed for expansion into other verticals
All of the above advantages make rewarded video ads a means of
establishing a thriving, mutually beneficial game ecosystem of users,
advertisers and developers. Users like the ads because they gain real
value by watching them. Advertisers are happy because they can more
effectively target higher conversion rates while raising the LTV of each
conversion. Developers meanwhile obtain higher eCPM and product rating
Although rewarded video ads have yet to reach maturity in verticals
other than gaming, they are already showing a high potential for
adoption in IAP verticals including online reading, social media, and