Think twice about using incentivised video ads

UPDATE: I'm flattered this post got so much traction. Please visit my personal website at www.nickhatter.com for more great posts like this!

For those of you who don't know me: I don't like in-game ads (in their current state). So I founded a company (and was covered by TechCrunch) for this very reason.

First, a big congratulations to Crossy Roads raking in $1 million with Unity Ads' incentivised video ads. That is a huge and noteable achievement for sure.

But the issue I have is not with Crossy Roads, or with Unity Ads for that matter -- but the inference that many game companies are making from incentivised video ads, which is:

I couldn't disagree more. Gamers don't love video ads; they love free items and currency.

Just to give you analogy: A lot of people in society (such as game programmers on a deathmarch) hate or dislike their job. But they like getting money! They may want to work overtime. Does that mean they love their job? No, of course not, it just means they're willing to put it up with it.

Video Ads - 15 Second streaks on a toilet bowl?

Similarly, just because players opt-in for video ads, that doesn't mean they love them. That just means they're willing to put up with ads to temporarily stain the screen like "streaks on a toilet bowl" for 15 seconds (credit goes to Charlie Brooker for this analogy about popup ads).

Too many ads will dilute a premium gaming experience and thus reduce the likelihood of in-app purchases. Why do you think King dropped in-game ads? The answer: to give a more premium game experience. Guess whose games is one of the highest grossing games in the world?

("Abandoned Trailer, Toilet and Bath" by Jereme Rauckman, licensed under Creative Commons 2.0. Source: Flickr )

So whilst ads are great for compensating for the 98.65% of players who spend nothing in games, they need to be used very, very carefully.

As the in-app purchase rate drops lower than before, this will this mean more game publishers switch to more intrusive (aka. higher CPM) ads to compensate for the loss of revenue. So, the in-app purchase rate will go down even more and... You get the idea.

I am not without sympathy of course; monetising games can be like getting blood out of a stone. We just need to think twice about diluting the gaming experience.

Nick Hatter is, somewhat ironically, founder and CEO of giftgaming -- a new in-game advertising platform that lets brands buy in-game powerups and currency and gift them to players.