Among the challenges of 2020 and the mobile advertising ecosystem shifts expected in 2021, many app publishers see signs of hope. In mobile games especially, there’s high player engagement, industry growth and an ongoing flow of monetization innovation.
Here’s a look at 2020 mobile ad spend, 2021 forecasts, and Meta Audience Network recommendations for app publishers and developers in the year ahead.
Mobile ad spend and forecasts
Around the world, mobile ad spend was significant in 2020, with mobile representing 64% of total U.S. digital ad spend¹ and 41% of Europe’s total digital ad spend.² In APAC, digital ad formats were the greatest revenue drivers this year, with mobile ad spend expected to grow 6%.³
Looking to 2021, eMarketer predicts U.S. mobile ad spending to increase 22% to over $117 billion.⁴ And in-app ad revenue is expected to grow globally; even with the anticipated impacts of IDFA loss, Omdia forecasts 68% growth through 2025.⁵
What should app businesses focus on for 2021 and beyond?
In the below video, Joanna O'Connell, VP Principal Analyst for Forrester Research, discusses the future of the mobile advertising ecosystem and how both publishers and marketers can position for growth. After watching the video, read on for additional publisher and developer recommendations.
2021 priorities for app publishers & developers
Publishers looking to thrive in this changing ecosystem should consider the following four trends when rolling out their 2021 monetization strategy.
1 - App bidding adoption advances
To help improve operational efficiency and transparency, many publishers are accelerating their adoption of bidding. As eMarketer Analyst Yory Wurmser stated in the report App Monetization Trends 2020, “the pandemic has had another effect on app monetization, which is the rise of bidding.⁶”
Publishers who adopt bidding now can free up valuable time and resources to help navigate changes ahead, as described in: The New Era in Ad Monetization: How App Bidding is Transforming Businesses.
2 - In-app ad growth continues
In-app ad revenue growth is anticipated to keep climbing in 2021, despite IDFA loss. Omdia’s December 24 App Ecosystems Forecast predicts in-app ad revenue in 2021 to rise by 6.2% for non-gaming apps and by 19.1% for gaming apps.⁵
We recommend that app developers build ads in from the start, using creative ways to offer value over disruption. If your development team is reluctant about building in ads, take a look at these 3 Myths and Realities of Ads in Mobile Games.
The next two recommendations are specifically for mobile game publishers and developers.
3 - Rewarded video continues to drive high lifetime value (LTV)
Rewarded video increasingly proves to be a flexible ad format that can be highly effective for marketers and publishers, while bringing deeper engagement for players. Therefore, we recommend a particular focus on rewarded video for 2021.
For Leyi Games, implementing rewarded video improved player retention while bringing in an additional 10 million CN¥ in revenue (the equivalent of $1.5 million USD).⁷
According to "Why the Ad-Supported Model of In-game Advertising is a Win-win-win," surveyed gamers shared that rewarded video is the most useful and least disruptive ad format, leading to longer gameplay sessions and more opportunities for content discovery.⁸
4 - Genre-specific and hybrid (IAP+IAA) monetization strategies become critical
In 2021, mobile game publishers and developers should become experts at diversifying their monetization mix, knowing when to offer in-app purchases (IAP) and when to offer in-app ads, and varying the strategy depending on genre.
Hypercasual publishers are recognizing that an in-app ad only monetization strategy can leave them more vulnerable to CPM fluctuations than a mix of in-app ads and IAP, as discussed in the on-demand webinar: 2021 Mobile Games Monetization Trends. We recommend a mixed monetization strategy, as well as integration of Facebook Gaming Services to enable organic player acquisition, engagement and retention.
Hardcore, midcore, casual and social casino publishers who previously relied only on IAP have learned that in-app ads can drive higher revenue and higher retention, as shown in the report Ads, IAP or Both?. For maximum benefit from in-app ads in a hybrid model, developers should follow best practices on implementing the rewarded video entry points by genre. To help, we offer Success Factors for In-app Ads in Hardcore & Midcore Games, Social Casino, and Casual Games.
Recommendations for sustainable monetization in 2021
Meta Audience Network is trusted by app publishers and developers around the world. As you adapt your monetization strategy in 2021, get started on partnering with us and look to these resources for guidance on the recommendations we’ve outlined.
Optimize rewarded video by genre Get in-app ads right for your game type
Test ads in your IAP model 7 Steps from IAP to Ads: A Guide to Testing Hybrid Monetization
¹ Mobile Advertising Trends To Watch, Forrester Research, July 20, 2020
² Digital Advertising: Europe, Statista, October 2020
³ APAC’s ad market set for strong rebound in 2021, WARC, June 2020
⁴ Mobile Advertising Outlook 2021, eMarketer, December 16, 2020
⁵ App Ecosystems Forecast, Omdia, December 24, 2020
⁶ App Monetization Trends 2020, eMarketer, September 2020
⁷ Leyi Game Success Story with Meta Audience Network, 2020
⁸ Mobile Games Advertising Report 2020, 2CV (commissioned by Meta Audience Network) - a quantitative and qualitative study in UK, US, DE, FR, TR, BR, AR, KR, JP, RU and VN between March to May 2020 on the changes in the mobile game advertising since 2017 and how advertising impacts players, July 2020
Related resources
Understanding bidding metrics and optimization
Here, we explain each step behind the technology of in-app bidding with Meta Audience Network and optimization strategies
December 8, 2022
Understanding bidding metrics
Here, we explain each step behind the technology of in-app bidding with Meta Audience Network.
December 8, 2022
How to optimize bidding
In this video, we explore strategies to optimize bidding metrics.
December 8, 2022
To build a great gaming business, unify monetization and acquisition
In this article and podcast, Rob Kiely and Michael Bertaut explore how unifying monetization and acquisition is key to building a great gaming business.
November 24, 2022
Sign up for our newsletter.
Stay up-to-date with the latest insights, updates and optimization tips sent to your inbox.
Follow us
Meta Audience Network empowers app developers and publishers to deliver a great user experience while growing a sustainable business. With Facebook demand from millions of diverse global advertisers, publishers can expand their app’s reach, keep users engaged, and monetize globally.