When it comes to monetizing free-to-play mobile games, developers often find themselves caught between a rock and a hard place. With in-app purchases (IAP) and in-game advertising both disrupting the player experience to some extent, striking the right balance between player experience and profitability is a huge challenge.

The fact is, the large majority of players will never make an in-app purchase, which means in-game advertising is often the primary revenue driver for many developers. But if ads aren’t shown at the right time and at the right frequency, it can send churn rates through the roof.

In the early days, developers agonized over native ad design and display as they were highly sensitive to players’ perceived concerns. Now interstitials and rewarded video ads are much more of an accepted part of the experience for players, particularly if they have no plans to pay.

Despite this shifting perception, integrating ads into your game still has to be approached with caution. Here some of the most common pitfalls that developers make:

Serving ads to every player

Tolerance to ads varies hugely from player to player, so by serving ads to everyone you’re guaranteed to upset a good percentage of your players (who will no doubt leave the game as a result).

We know from our data that some players respond better to IAPs while others are more ad responsive. Therefore, developers need to take a more intelligent, data-led approach and develop ad strategies which are more closely aligned to individual player behaviors.

Serving ads at the wrong time

The last thing a player wants to see after failing a mission or losing a life is an ad. Showing ads to players after defeats or when they are finding the game frustrating is likely to lead to one conclusion – the player will leave.

The emotional state of the player viewing the ad is important not only to retention, but also to generate ad revenue through clicks and installs.

Being overly cautious

Developers are clearly aware of the delicate relationship which exists between players and ads, so many take an overly cautious approach and avoid serving ads until much later in the player life cycle.

This approach will certainly please your players, but with low retention rates commonplace in F2P, by the time you decide to serve ads many players will have already fallen out of the game for one reason or another. You’re then missing out on a huge revenue-generating opportunity.

It’s all about striking an appropriate balance, and if this can be achieved from the outset, then there’s no reason why players shouldn’t be served ads from session one. particularly as it can be an instigator for players to pay.

Our analysis shows that most games that show interstitial ads do so within the first 10 minutes of gameplay. We also know that ad frequency has little to no impact on app store ratings and rankings.

Sticking to just one ad network

If you want to maximize your revenue from ads, you need to use multiple networks. Not all networks will fulfill your request for ads, and the price they’ll pay you can vary, often amounting to nothing if the space is unfilled. Sticking to one ad network can cripple your ad revenue as a single network will likely provide just 25% fill.

One option is to set up an active cascade system where the highest eCPM is at the top. It will then default to the next one down if the network choose not to fulfill the ad. This can be quite a tricky and time-consuming process to get right and if not automated, will need constant review. Dynamic ad mediation then selects the best deal by cascading ad networks automatically.

Making ads a gameplay roadblock

If players aren’t engaged, they won’t spend. One of the most common reasons players leave a game is they’re annoyed with frustrating monetization mechanics, or overzealous advertising getting in the way of the game experience. But it doesn’t have to be this way.

Rewarded video is one example of how ads can be integrated into a game with minimal impact on retention. Because they are opt-in and offer a direct benefit in terms of extra resources, players are much more willing to watch the ad, especially if it’s well targeted.

A recent research project conducted by the deltaDNA’s game design team found that among top ranking games, around 30% contain some kind of rewarded ad mechanic.

Today’s F2P marketplace is becoming increasingly overcrowded, and as a result players are more likely than ever before to discard a game. With ‘big data’ technology the door is open for game makers to tailor in-game advertising to players based on their behavior, serving ads to players that are responsive to them and getting the frequency of ads seen by each player right. Not only does this help to monetize games more successfully, it creates an experience that players are far more likely to enjoy.

This post originally featured on the deltaDNA blog.