The market of video games is going through an unprecedented boom. The recent figures are striking. Projections by Statista indicate that by the end of 2024, the video game market will reach almost $283 billion in revenue. What’s even more astonishing is that by 2027, the numbers will grow to an impressive $364 billion with 1,48M gamers.
In such a saturated market with a lot of potential, the pursuit of profitability is inevitable. Luckily, the realm of video games offers a lot of monetization opportunities that developers should leverage to achieve financial success. Keep reading as we are going to show you traditional and advanced video game monetization models to drive revenue in the dynamic gaming industry.
12 monetization models in video games
Let’s explore the fundamental video game monetization models. These are the proven ways that guarantee profitability in the world of gamedev.
In-game purchases
As straightforward as it sounds, this model consists of generating revenue by offering players a wide set of features or content for real money to make their experience more engaging. It’s the most typical model for games with free and open access.
In-game advertising
When it comes to driving profit, in-game advertising is one of the most strategically successful and predictable mobile game monetization models. Notably, in-app ads boast the largest share of the video game market, with the volume nearing $110 billion in 2024. This tactic implies displaying ads in different formats during gameplay or between levels.
Pay-to-play model
This traditional method of monetization in video games means enabling players to download a full game after they complete a one-time payment. This approach is very stable as it enables them to generate profit straight away. However, it’s also very tricky as the market is overflowing with free options, hence making it super difficult for developers to convince users to pay upfront.
Freemium model
This gaming channel monetization model is very similar to in-app purchases. Whereas the first option allows purchasing any type of content, the freemium model allows users to play for free while acquiring premium features not accessible to regular players through microtransactions.
Sponsorships
This game monetization approach is getting more and more widespread. While it can manifest in various forms and complexities, the overall principle remains the same. It involves brands paying developers to integrate sponsored content within their games.
Hybrid monetization
To maximize your revenue opportunities, a hybrid model allows developers to seamlessly combine different approaches. Keep in mind that there is a fine line between integrating monetization models effectively and ensuring they enhance the gaming experience, rather than distract from it.
Now, let’s see some more innovative approaches to video game monetization to come up with the suitable strategy that fits your business goals.
Subscription-based gaming
Lately, more video games offer a subscription model to their users. There are different subscription types but the overall approach lies in offering players unique updates, features, and other perks for a recurring fee they pay on a monthly basis.
Loot boxes
Introducing loot boxes or gacha systems opens more opportunities for mobile game monetization. These are randomized virtual items that players can occasionally receive during the game and boost their progress. Rewards from a loot box can be bought for real currency and users can purchase the rare or more desired items.
Virtual good marketplaces
Game developers can create a virtual marketplace where players can buy, sell, and exchange items such as skins, weapons, and diverse customization options, substantially improving their gaming experience. This model will be most suitable for multiplayer games.
Virtual currency monetization
This is another way to monetize a video game. Players can simply buy the virtual currency with real money and then use it to purchase upgrades, enhancements, and any desirable items. This way, developers can promote in-game transactions and boost engagement by offering special offers and rewards.
Season and battle passes
Introducing season and battle passes can be one of the greatest mobile game monetization models. They create a sense of achievement and progression among users, spurring players to invest even more in their gaming experience. The model enables users to acquire a season pass upfront and access an array of exclusive items, in-game challenges, and rewards for a specific period.
User-generated content monetization
The last but not least way to generate additional revenue streams and encourage creativity among players lies in monetizing user-generated content. For instance, users can create their own unique avatars or custom game environments that can be purchased by other players if they are willing to pay.
SSPs in monetizing games
It’s worth mentioning that in-game advertising stands out as the most stable and the most popular approach to monetization of video games. It has been firmly rooted in the gaming ecosystem offering a wide range of perks and advantages that enable developers to maximize their revenue.
If you find yourself thinking, “How can I monetize my video game with ads?”, we are here to delve deeper into this approach and introduce you to an unparalleled opportunity to generate steady profit from your creation.
An SSP, a Supply-Side Platform, is an intermediary that enables game developers to turn their video or mobile games into the ad space and make money by selling it to interested advertisers.
With the SSP, how to monetize games is no longer a question. These platforms streamline ad placement and management processes while maximizing profit. An SSP, supports a wide range of ad formats, both traditional and interactive such as playable ads, as well as offers other tools and resources needed to drive revenue.
Game developers can easily manage their ad space and close deals with advertisers to drive profit. Usually, SSPs are already connected with a wide network of demand sources (direct advertisers, ad exchanges, ad networks) so getting revenue from in-game ads will be smooth and transparent.
Long story short, SSP features empower developers to unlock the full revenue potential of their games across mobile, PC, and console.
SmartyAds exclusive insights: tips to create a winning game monetization strategy
SmartyAds team is happy to share our insightful tips that will allow you to get the most out of in-game advertising and boost monetization in video games.
Gamification of ads
It’s paramount to introduce ads in a natural, non-intrusive manner to prevent any irritation and foster an enjoyable playing environment among gamers. Therefore, gamification of the ads emerges as a great strategy, enabling developers to seamlessly introduce promotions without disrupting players’ experience.
The possibilities are immense, from integrating mini-games sponsored by brands, to reward-based advertising where players earn rewards by engaging with the ad. As a result, not only will it minimize irritation caused by the promotions, but they will be highly motivated to engage with them. This will make your games highly appealing for future advertisers seeking effective ad placements and will generate high ad-based revenue.
Personalization
We live in an era where data shapes the world around us. Why not leverage data-driven insights in your video game monetization endeavors? Well, no matter what industry we are talking about, customers now want the highest level of personalization.
Data monetization in gaming opens plenty of new opportunities to generate streams of revenue while pleasing your players with advertisements that resonate with them, their needs, and their interests.
Delivering highly precise and targeted ads is becoming possible with data-rich insights. By thoroughly analyzing players' preferences, in-game behavior, and demographics, developers can create a personalized ad experience for players and offer very relevant offerings, for instance, product recommendations that players previously interacted with. This approach is not very intrusive as it aligns with the very nature of any player and makes them more receptive to these types of ads.
Interactive ad formats
Interactive ads emerged as a powerful tool to monetize video games by creating a captivating and immersive experience. As this type of ads encourages the viewers to engage with them, ultimately they result in higher interaction rates and lead to increased conversion rates.
It’s paramount to make the in-game promotions as smooth and native as possible. Utilizing a broad range of interactive ad formats will be a very smart and effective tactic. These include playable, quizzes and polls, rewarded ads along with rich media that will foster a memorable experience compared to traditional static display ads.
To facilitate the integration of these interactive formats, the SSPs are critical. They serve as an intermediary between developers and advertisers and enable them to easily introduce an array of interactive ad formats to maximize the revenue generated.
Cross-platform monetization
If you are aiming to boost your revenue, we recommend you explore cross-promotion strategies to maximize monetization opportunities across multiple platforms. Whether your game is on mobile, PC, or console, leveraging cross-platform networks can be beneficial. You will be able to organically attract new players by connecting with other developers and establishing mutual promotions.
If the game is available across different platforms, it’s possible to launch personalized ad campaigns tailored to the specifics of each platform, enhancing your advertising efforts. The newest SSPs make it all possible and facilitate effortless ad integration across platforms to drive revenue regardless of the device or operating system. They ensure the highest level of compatibility with diverse gaming platforms and support a wide range of ad formats, allowing developers to get the most out of their games.
It’s important to understand that certain types of games may still require a specialized separate infrastructure as, for instance, PC and mobile games need a distinct environment for monetization. Despite some technical limitations, a growing number of cross-platform programmatic advertising solutions are emerging. They are designed specifically for the gaming industry and offer broad support of features to enable developers to monetize and manage their inventory in one place.
How can SmartyAds help you drive better results?
SmartyAds, a renowned leader of programmatic advertising, offers a feature-rich Supply Side Platform to effectively monetize mobile games.
With SmartyAds, you have an opportunity to start generating profit immediately. Our streamlined and transparent SSP connects to a vast range of demand sources enabling you to unlock your game’s revenue potential and to generate profit from the very first days, if not hours. Closing profitable deals with advertisers and turning your game into a powerful source of monetization has never been easier.
Our SSP boasts extensive functionality, empowering developers to create, manage, and analyze their ad placements. What makes our platform stand out is our robust infrastructure allowing seamless integration of in-app and mobile web advertising.
Moreover, our platform features plenty of interactive and engaging ad formats specifically for in-app advertising. From playable and rewarded ads to rich media and video ads, we provide all the options to engage with your players and harness the full potential of your game, while optimizing its profitability.
Feel free to get in touch with our professionals and we will gladly give you more details about unlocking the full monetization potential of your games through our SSP. We are committed to making your success real.
Connect to SmartyAds SSP and start maximizing your game’s revenue today!
