With the App-ocalypse still fresh in our memories, we’re all feeling a little worn out from the mad scramble. But changes keep coming at us at a rapid rate in 2023.
We hate to be the bearer of bad news. However, if advertising is still your primary revenue model as a game developer, now is the time to reexamine your revenue streams, especially if you hope to maintain or experience growth in these turbulent times. Here’s why:
Tough Times are Here
Prominent economists and investors have warned about the coming recession for several years. It’s finally here in full force. Troubling economic indicators, inflation, rising interest rates, and an anticipated surge in unemployment are projected by some economists.
As a result, consumers will have less to spend and turn to free and low-cost entertainment. Meanwhile, marketers will closely monitor every dollar spent to ensure stable ROI.
R2 Media Inc says at least the first two quarters of the year will prove turbulent waters to navigate. But it could be longer.
CPMs To Tank
With marketers keeping a close watch on every dollar spent and demand for ad inventory plummeting, CPMs are expected to see a significant and sustained decline.
With a greater emphasis on marketing ROI, brands will be spending less but moving to more aggressive tactics to acquire customers to keep their revenues coming in. Attributable ROI will be the new norm for advertisers.
What’s A Developer To Do?
Game developers have had a tough go of things as of late, of that there is no doubt. Whether it’s increasing restrictions such as GDPR or changing economic conditions, recent events have forced developers to turn on a dime or make very tough choices about their business. We’ve seen too many layoffs already.
The time for a hard pivot, though, is now. And there is much to be gained in evolving your monetization strategy.
The problem that remains for most, if not all, casual and hypercasual games that rely on advertising is that advertisers are not getting demonstrable ROI on their ad. Not until now, that is.
When you add gCommerce it’s a game changer for all – brands, players and of course you – the game maker. By letting gamers purchase products without ever having to leave the game means they can enjoy the game while they’re shopping, without ever breaking their immersion. For brands it provides them the attribution, performance and ROI they demand, without you fretting over being compliant with the new rules.
Add to that, your players getting rewards for making purchases. Rewards which they could apply towards future purchases or spending in your game? This incentivizes them to purchase more and remain loyal.
That’s a huge trifecta and win for all, with greater revenue potential. In this case, 1 + 1 impact of advertising and gCommerce results in a revenue sum far greater than the parts. It could save your business.
The time to explore new revenue models is now. If you don’t start making some changes, getting left behind is the least of your concerns. 2023 will be very challenging to sustain your business model with a status quo approach to your game monetization.
If you’re ready to make a change, let Scuti offer a helping hand.