How effective are ‘rewarded ads’?
Conventional wisdom would tell that most people don’t opt-in to adverts, and that this is especially true when it comes to apps.
Rewarded ads seem to be an effective counter-argument to this argument though. Not only do they get consumers to willingly watch ads, they also seem to make people more likely to part with their cash.
Rewarded ads allow users to earn virtual currency or unlock rewards in return for engaging with in-app advertising content.
Mobile marketers are raving about the successes of rewarded ads.
AdColony’s Summer 2017 Publishing Survey reports that 75% of surveyed businesses claim that rewarded ads are the most effective method of monetisation, ahead of in-app purchases (63%) and interstitial ads (44%).
87% thought that rewarded ads provided the best experience for users.
So how effective are rewarded ads in driving in-app purchases?
Mobile advertising platform Tapjoy analysed eight apps that have a high volume of daily active users to see how they interact with rewarded ads. The analysis found that users who engaged with rewarded ads were 4.5 times more likely to make an in-app purchase.
Across all the apps, those that opted in to ads showed a greater willingness to spend, with the boost in spend being an average of just under 200%.
There also seemed to be a positive effect on user engagement. Across all the apps analysed, the average number of daily sessions per user increased by 34% among those who had opted in to at least one rewarded ad.
“Some app developers fear that giving their users the option to earn currency through rewarded ads will reduce the likelihood of in-app purchases or negatively impact user spend. Our data shows that not only do developers have no reason to worry about such cannibalization, but rewarded ads are actually conducive to IAP,” said Benjamin Chen, SVP & GM, Developer Relations at Tapjoy.
“Our hypothesis is that rewarded ads serve as an initial introduction to an app’s in-game economy or premium content. Once users get a taste for it, they want more – and they’re willing to pay for it.”