How Ads increase IAP & Subscription revenue by Felix Braberg

Speaker 1 Anchor each other and makes the other choice look a lot cheaper and also increases the perceived value of whatever

Speaker 1 options you're doing. So, yeah,

Speaker 1 very clever way. They

Speaker 1 not like the newest thing you can hear about, but basically, this is the first time I'm actually seeing this being more prevalent in most remove ads messaging.

Speaker 1 So, the third thing that I'm currently seeing, which is

Speaker 1 it's 4 a.m. and we're rolling the dice.
Late drops, knowledge made of gold and ice. Felix with ads making those coins rise.
Jackup designs worlds chasing the sky.

Speaker 1 We're the two and a half gamers, the midnight crew. Talking UA adverts and game design too.
Matei, Felix, Shaku, bringing the insight. We're rocking those vibes till the early daylight.

Speaker 1 But KUA master eyes on the prize. Tracking data through the cyberspace skies.
Felix stacks colors like a wizard in disguise. Jackups crafting realms lift us to the highs.

Speaker 1 Two and a half gamers talking smack. Slow hockey sick, got your back.
Ads are beautiful, they like the way. Click it fast, don't delay.
Uh-huh.

Speaker 1 Uh-huh.

Speaker 1 Uh-huh.

Speaker 1 Uh-huh.

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Speaker 1 Uh-huh.

Speaker 1 Hello, everyone, and welcome to another edition of ASMR Insights by Two and a Half Gamers.

Speaker 1 This week, it's only me and only me for about 20 minutes talking about something that I really like.

Speaker 1 Today I'm going to be giving you the talk that I did last week at Pocker Gamer Connects and my talk was on how to use ads to drive IAPs and subscription.

Speaker 1 It's essentially a 15 minute 20 talk 15 to 20 minute talk on what I'm currently seeing happening in

Speaker 1 the world of ads and how ads or remove ads messaging is being used to basically drive IAPs and subscriptions.

Speaker 1 So

Speaker 1 before starting, it's just kind of one of the trends that we've been noticing happening in the mobile space quite significantly in the last couple of months is that more and more developers are starting to shift focus away from games to actually focus on mobile apps.

Speaker 1 Kind of the promise is that there is way less competition.

Speaker 1 in the space of mobile apps and way less so than what we're currently seeing in mobile games.

Speaker 1 And it actually is the first time in the last six months where I've seen a considerable amount of innovation actually starting to happen on the mobile app side that is basically translating into innovations on the gaming side.

Speaker 1 And I think that's quite interesting because normally we always used to think that game development always led the way in terms of, yeah, game development, that is to say, whatever happened in mobile games, is whatever you saw happening in apps a year or a year and a half later.

Speaker 1 But this is the first time where we're starting to see really a lot of innovation on the app side which is why i'm calling 2025 the year of the mobile apps

Speaker 1 so

Speaker 1 this is about me i had that in for the slide in london if you've been following the podcast you already know who i am i'm an ad monetization consultant i've been in the industry for about eight years and i help games and apps earn more ad revenue um so today what i'm going to talk about is essentially some publisher trends and what I'm seeing on the publisher front and who are actually the main players in terms of downloads from the last 30 days.

Speaker 1 I'm going to talk a bit about ad quality because essentially as ads are getting worse, it's actually enabling you to be more creative on the remove ads messaging and actually drive subscriptions and ISPs by offering users a more ad-free experience.

Speaker 1 I'm going to show you three examples on what clever ad app developers and game developers are actually doing to basically drive users to make subscriptions or first-time purchases to remove ads.

Speaker 1 And then, yeah, probably no questions, but what we can do afterwards is if you have any questions, you can post them below on this video and I'd be sure to answer you.

Speaker 1 So

Speaker 1 here are the ad monetization trends. So in the last 30 days, these are the game companies that have gotten the most downloads.

Speaker 1 So you still see that even if you take out, I've taken out here the kind of the mega cap

Speaker 1 social media companies, but essentially you can see here that Azure Interactive still dominates in terms of the most download from a single publisher worldwide.

Speaker 1 They got 96 million downloads in the last 30 days. After that we have Segames, 78 million downloads, Supersonic, 76 million downloads.

Speaker 1 Followed by voodoo 70 million downloads. Then you have Mighty Mini Clip who's been an absolute acquisition spree in the last couple of years.
They have 66 million downloads. Embracer, 62.

Speaker 1 iCame, our friends from Vietnam that I want to visit, 59 million downloads. Outfit 7, 57 million downloads.
And Tencent, 55 million downloads. So the absolute top in terms of downloads is still...

Speaker 1 absolutely being dominated by the previously hyper casual companies that have shifted away now to start working on hybrid casual games, right?

Speaker 1 So, the interesting thing here in the top list is that

Speaker 1 in the last couple of years in our industry in mobile,

Speaker 1 there was

Speaker 1 some app first companies that were getting significant amount of downloads, but essentially they weren't getting as many.

Speaker 1 So, if you're actually looking at the top 100 list in terms of publishers that are getting the most downloads

Speaker 1 usually, you didn't see any app companies break into the top 50 that are not social media or e-commerce companies. I'm excluding that because that's just a whole nother beast.
But

Speaker 1 here is a list of the top downloaded mobile application companies and publishers in the last 30 days. So you have QR Code Scanner, 27 million downloads, Story Matrix, Bending Spoons from Italy,

Speaker 1 19 million downloads, Duolingo, 17 million downloads, Crazy Maple Studio, which we talked about here, which is a really cool company from China making short dramatic videos.

Speaker 1 And the takeaway from here is that more and more downloads are being driven by app companies, which means that they're also starting to monetize quite heavily with in-game or in-app ads.

Speaker 1 And this is the kind of first time where they're starting to get significant amount of traction and a lot of downloads.

Speaker 1 Spending sponsors has been around for quite a while, I do admit, but this means that these companies, which are extremely good at A-B testing, have started to experiment with remove ads messaging or how to serve ads for users in a very, very unique way, because they come at this from a very different way than a game developer does.

Speaker 1 Typically,

Speaker 1 like these app companies do a lot more thoughtful A-B experiment and test small, small things a lot more so than the gaming people do.

Speaker 1 But that's kind of one of the meta things that's driving these changes that we're going to go through in terms of remove ads messaging.

Speaker 1 Also, one other thing that's been happening that's kind of a meta trend. So, we have one meta trend, which is mobile app companies getting a lot more downloads.

Speaker 1 And the second trend, which is a trend, I guess, that we've been talking about for the last two years, and that is ad quality.

Speaker 1 So, if you've opened any experience on mobile in the last years, you've definitely seen this, right? So, basically, ads are getting longer, they're getting harder to click out of.

Speaker 1 And the main driving force behind that is essentially that networks that have a more annoying and longer ad experience basically sees increased click-through rates and increased install rates, meaning that they have higher margins on ads that they serve that have a worse end card or creative length.

Speaker 1 So, when I first started in the industry, rewarded videos used to be about 30 seconds with basically one click to click out of.

Speaker 1 Sometimes now, rewarded videos can be upwards of 114 seconds and take sometimes like five or six clicks to click out of. Interstitials are sometimes closable only after 15 seconds now.

Speaker 1 And banners are sometimes on refresh rates that are between five to ten seconds. So that's one of the other things that's driving these kind of meta changes.

Speaker 1 So

Speaker 1 up until six months ago,

Speaker 1 this was the this is basically a list of the largest ad networks currently serving on Macs, ranked in order of largest to smallest. This is from the last 30 days.
So

Speaker 1 six months ago, the only company that didn't have long or intrusive ad formats was Google. And basically they changed it in, yeah, I think it was early December, early January.

Speaker 1 They started rolling this out called high engagement ads, which essentially means that rewarded ad, the rewarded ad experience is up to I think 50 seconds with three clicks to kick click out of and the interstitials I'm not sure what they actually are but basically they responded because every single ad network on this list is essentially serving longer and harder to click out of ads so

Speaker 1 we have

Speaker 1 increasing and like increasing like development in terms of mobile app publishers getting more and more getting more and more downloads we have ads that are getting longer and we have all networks now in the mobile space that essentially have intrusive and long end cards.

Speaker 1 So with that in mind, let me introduce you to the highly lucrative and highly competitive

Speaker 1 brain training app market. It's quite an interesting market because it sits at the intersection of what is an app and what is actually a mobile game.

Speaker 1 And this market is basically being dominated by two apps or two games, however you want to call it, right?

Speaker 1 It's Impulse by GMRD Apps, which we have covered on the podcast, and then also another one called Elevate by Elevate Labs. So these two apps essentially do the same thing, right?

Speaker 1 So the first-time user experience is

Speaker 1 very similar, and what they actually say that they're offering is very similar as well.

Speaker 1 So what you do is essentially you log in a couple times a day to play three core games that are supposed to help with increase to increase your cognitive function.

Speaker 1 So yeah, on the left, we have

Speaker 1 on the right with Impulse, and then on the left, we have Elevate. And essentially, these two apps are dominating the market.

Speaker 1 And the interesting thing is that one of these apps has ads in it, and it has rewarded ads and interstitial ads and banner ads. And the other one has no ads whatsoever.

Speaker 1 So.

Speaker 1 I'll let you take a guess which one is using ads.

Speaker 1 So remember that, you know, Impulse is the one in purple here scaling through the moon and elevate is the blue one that's kind of yeah what jakob would call slow hockey stick growth

Speaker 1 so i'll let you think just for a second now if you think it's um impulse or elevate that has ads

Speaker 1 so let me help it make it a bit easier right so here is the retention profile for these two apps in the last 30 days. So you have Elevate, day one retention of 27%,

Speaker 1 and you have Impulse, which has 25% day one retention.

Speaker 1 You can see that day A7 is a lot better on Elevate and on Impulse it's about yeah a couple of percentage points lower. So think now is it elevate or impulse that has the ads?

Speaker 1 Okay so if you think it's elevate basically

Speaker 1 You're wrong.

Speaker 1 So elevate does not have any ads and impulse is the game that or is the app that has ads in it which is a bit counterintuitive intuitive right because usually ads decrease your retention metrics because as we just talked about, they're getting longer and more difficult to click out of, right?

Speaker 1 So let's take a look at the same retention metrics from 18 months ago. So you can see that Elevate's retention metrics are pretty much the same.

Speaker 1 And you can see also that Impulse's retention metric were a lot worse.

Speaker 1 So what was the big change that drove those retention metrics?

Speaker 1 So Impulse had ads already, but basically what was the one thing that they did, or they did a couple of things, but one of the things that they did that was extremely clever was that they started doing something called remove ads, push notifications, what I call push notifications.

Speaker 1 So basically, after the first time user experience, when they start showing ads to users, they basically invented a push notification to show up after each interstitial ad was played. So

Speaker 1 this is what happened

Speaker 1 when a user sees the first interstitial ad in Impulse. So you get a push-up screen that says ads are skippable after 5 to 15 seconds and help support further app development.

Speaker 1 And basically after that, they also show what buttons to look out for to click out of the interstitial ads. So if you think about and take a step back, what they're actually doing here is that

Speaker 1 they're kind of separating themselves away from the networks. So it's extremely clever, right?

Speaker 1 So normally when you have users, it's typically users interact with a developer and they usually blame the developer for any ads that are seen in the game.

Speaker 1 But here what they're doing is they're notifying the user that we're sorry, we have to see these ads. We need them to help app development.
It's not our fault. But here's how you click out of it.

Speaker 1 So what happens after the second interstitial, after you see the second interstitial in Impulse?

Speaker 1 You're shown another push notification which says, did you know that you can actually remove these ads by becoming a premium user? And then it says, try three days for free at $6.99 per week.

Speaker 1 Start free trial. You don't have to, you can click out of it.
So then what happens after the third interstitial?

Speaker 1 Basically, the third interstitial shows that you can remove this, you can actually remove ads by clicking the remove ads button at the top here.

Speaker 1 And if you want, yeah, you can pay for it to remove the ads.

Speaker 1 After the fourth interstitial, what you're faced with is a splash screen interstitial, which is basically

Speaker 1 coded, hard coded,

Speaker 1 hard coded by impulse.

Speaker 1 And essentially what they do is that basically they give a user a two-way choice where a two-way choice where essentially they have to decide if they can do a three-day trial or they can actually remove ads for all time by basically making a $44 purchase.

Speaker 1 Then what they do is also, if you keep seeing interstitial ads and you keep playing one of the brain training games, is that you can remove ads for only this game.

Speaker 1 So basically then you're left with a choice that you can leave ads on or remove ads with one IAP for $6.99 or for $5.99.

Speaker 1 So this is the first thing that I've seen, which is extremely clever, which is coming from the app side, where essentially they're doing a lot of experimentation on how to actually get users to make a purchase and this is actually what apps are really really good at because they work mainly on subscriptions so this is probably yeah exactly an experiment of or actually showing extremely well how apps are a lot better than games on basically testing new things and new ways of yeah being innovative when it comes to ads messaging

Speaker 1 so

Speaker 1 If you think about it, what they're actually doing within notifications is that, yeah, it gives you an immediate intention capture.

Speaker 1 It separates out the developer from the ad networks and basically moves a lot of this blame away that you get and basically creates a bit of an emotional bond. I think it's extremely clever.

Speaker 1 So moving on to the second

Speaker 1 way, which I've seen kind of also being starting to be implemented in both apps and games, that is essentially the remove ads double choice.

Speaker 1 And this is the second thing that I would say is how to basically use remove ads messaging to drive IEPs and subscriptions. So impulse, we've already seen it.

Speaker 1 You have here a choice between removing ads for a lifetime for like a big purchase fee or you can try a subscription. So basically that's with a double choice.

Speaker 1 Then we have another example here from pinout where basically you can remove ads for a subscription for seven days for $5.99

Speaker 1 or remove them for forever for $9.99.

Speaker 1 You have the same thing on ScrewJam and you have the same thing on minigames, comma, relax, where basically you're giving three choices basically to

Speaker 1 remove ads at different price points. So

Speaker 1 what happens psychologically when you're actually given a double choice?

Speaker 1 It's called like a phenomenon in psychology called comparison and anchoring, where essentially the more price points you're actually given to a user basically

Speaker 1 helps users perceive the first choice to actually be a lot cheaper than actually the second choice. So, the second choice in terms of pricing is actually insignificant.
It's only there for phrasing.

Speaker 1 So, essentially, if you give an offer like shown here for one for $1.99 for two days and one unlimited for $2.99, essentially, what they do is they anchor each other and makes the other choice look a lot cheaper and also increases the perceived value of whatever

Speaker 1 options you're doing. So, yeah,

Speaker 1 very clever way.

Speaker 1 Not like the newest thing you can can hear about, but basically this is the first time I'm actually seeing this being more prevalent in most remove ads messaging.

Speaker 1 So the third thing that I'm currently seeing, which is not really that new, and that is remove ads bundling.

Speaker 1 So bundling is also another pricing technique that's been used in mobile for a very long time and it's quite simple, right?

Speaker 1 You use bundle in a lot of things to increase the perceived value of making an IAP, right? This is not that new.

Speaker 1 How WordConnect does it is that they include remove ads, intrusive ads, for any purchase that is above a certain level.

Speaker 1 So for the more expensive IAP purchases, they also bundle in remove ads message or the remove ads IAP.

Speaker 1 You can see here, so for $6.99, you don't get the remove ads, but if you buy the same thing for $12.99, you get more coins and you also remove ads.

Speaker 1 So essentially, that's to push users to make the premium purchase that's actually worth more.

Speaker 1 Coffee Craze, you can see here they're doing no ads bundling, where actually it's like a welcome offer, which also includes the removing ads. Raid Rush was actually my favorite

Speaker 1 tower defense game right now.

Speaker 1 Any purchase that you make actually removes the interstitial ads.

Speaker 1 So

Speaker 1 this is not really that new, but

Speaker 1 I just wanted to focus here on because essentially what our favorite publisher from China is doing, Habby, which is probably the leading hybrid casual gaming company right now in the world

Speaker 1 and they basically taken the remove ads bundling to a whole nother level recently so they had two new games that have come out uh late uh late october last year that's capybara go which we copied uh which we yeah copied quite heavily on the podcast and also our chair 2 which we also covered quite heavily on the podcast be sure to check those episodes out but they've taken that even a step further right

Speaker 1 so they actually have a lifetime ad free card which means that essentially if you purchase the 949

Speaker 1 euro iap in this case not only do you remove ads forever but you also increase the daily amount of soft currency that you're actually giving to users So if you think about that, what they're actually doing is that the value or the perceived value, especially for these sticky games, is so much more increased because essentially you have to do way less grinding every day.

Speaker 1 Because if you pay to remove the ads, you actually get way more soft currency every day that's given to you so you can progress quicker.

Speaker 1 Super clever, super like interesting to see how this is doing. It'd be super interesting to actually know if this is actually the most popular IAP in these two titles.

Speaker 1 We probably wouldn't ever know, but if we go to China, we would definitely tell you.

Speaker 1 And yeah,

Speaker 1 this is how it's being done right now. Like, these are the best ways to use ads to drive IAP and subscriptions.

Speaker 1 Basically, push notifications right after the first ad is shown, percent double choice on pricing to remove ads, and bundle ad choices with a bunch of other items or increasing soft currency.

Speaker 1 So, this QR code here goes to my newsletter. I talk about a lot of this stuff if you just want to talk about ad stuff.

Speaker 1 But that concludes it for this ASMR special.

Speaker 1 And that's all for us this week. And don't forget to tune in next time.
Thank you so much. Have a good one.