I recently put together a post, and later a poll, asking the community whether they would be OK with the Splinterlands company putting ads up on the site. Matt responded to the idea of ads saying he doesn't feel there would be a good return on the ads. I still believe it would be worth testing a leaderboard banner ads (the wide & short horizontal ads you see almost everywhere - those are the ads with the best fill rates) below something like the "seeking enemy" screen. However, I also saw a fair amount of feedback from users saying they would rather have an ad experience that didn't interfere with core gameplay.
Here is where "Rewarded Video Ads" come into play. RVAs for short, these are ads that basically display only when a user performs a certain action, typically run for 10-30 seconds, and must be watched until the end for a user to reap some kind of benefit. They're frequently used in games as a way to earn some additional in-game currency.
Advantages of RVAs
There are several significant advantages to RVAs:
(1) They can be placed in an entirely separate place in the game that doesn't interfere with core gameplay.
(2) They typically have significantly higher RPMs, because they are longer, more engaging, and opt-in (user needs to perform an action to see them). From the research I did it's fairly reasonable to expect RPMs of $5-15 on websites and $10-50 on apps. We're a bit of a rare breed being a game website, so my assumption would be that it would be somewhere in between, e.g. $15-20. Reminder that RPM stands for "Revenue per mille", or the revenue for 1 thousand impressions ("mille" means "thousand" in French and it somehow became the convention...).
(3) The third big advantage is an often neglected one: RVAs are good for New Player Experience. The reason is because it's very hard to obtain Glint at lower levels, and yet Glint is a great way to upgrade your deck. Enabling new users to get a little extra Glint by watching some ads could be a terrific way to improve the NPE.
Note that the work required to put in place RVAs is HIGHER than for typical banner ads, because a mechanism needs to be put in place to reward the user upon the completion of the ad. It's not very complex, but definitely more than just placing a simple code block.
Suggested User experience
My suggestion is to build a new box in the "Resources" section of the Reward shop, where users can click "Watch Ad" to earn extra Glint. There would be a limit per account per day (e.g. 3 ads / day) to prevent abuse. After clicking "Watch Ad", the user would be shown a pop-up with the ad, which they would need to view till the end in order to earn their Glint.
Potential monthly revenue from RVAs
In the following screenshot, you can see a simple model of what the potential monthly revenue would be if we implemented Rewarded Video Ads. I've made several assumptions, stated at the top, and put a table showing two key variables: (1) RPM, and (2) % of accounts consuming rewarded video ads. For accounts participating, my assumption is they consume the max number of ads they are able to each day (in the model, that's 3).
As you can see, the revenue ranges significantly based on both RPMs and conversion rate of users. I've highlighted some cells in the middle showing what I believe is most likely based on some research about expected RPMs and my own (rather arbitrary) assumption of what % of players would take advantage of this.
Below the table I've also added the number of daily chest pulls that would be enabled by this amount of incremental Glint being released. Note of course that these would be spread across all participating accounts, so on a per account basis it's not much. And of course, the more people participate, the higher the revenue and also the more Glint released. Note that the chest estimates are based on the lowest tier cost for each chest. For reference, those are:
- Cost of Minor Chest: 200
- Cost of Major Chest: 1000
- Cost of Ultimate Chest: 4500
As you can see from the model, my estimate is that building this feature would pull in $1500-2500/month in revenue for the team. However, there are several things that could increase this, such as:
- Higher # of daily active accounts: The more players we have, the higher the impressions of RVAs, so keeping conversion rate and RPMs constant this would increase the revenue.
- Higher max watch / account / day: Instead of 3, this number could be 5 for example. However, I think there's a point where even on a per account basis users would not max out their number of watches. Also, increasing this number means a higher concentration of extra Glint / account.
- Higher conversion rates: Maybe putting this in the Reward store is too hidden, and making it more obvious/visible/accessible could increase conversion rates.
- Higher RPMs: This is hard to control as it's largely a factor of whether or not users are clicking on ads. I.e. if Splinterlands does implement this, you know what to do...
Conclusions
Here are the key takeaways from this post:
(1) RVAs are a good way to implement ads without being intrusive to the core gameplay
(2) RVAs have high RPMs, but limited conversion rates will limit the total attainable revenue
(3) RVAs can be good for the New Player Experience, allowing new users to obtain extra Glint for chests
(4) Based on my assumptions, RVAs could yield $1500-2500/mo
I hope the analysis above gives more information for the Splinterlands company to consider whether or not to implement RVAs.