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 Mobile in-game advertising is a touchy subject for many. Phones are intensely personal devices, and many fear that consumers will resent advertising intruding into that personal space. On the other hand, advertising-subsidized gaming is a real possibility in mobile markets. “Free mobile games” is an attractive proposition for gamers, just as it is a very disruptive one for established mobile publishers.
We recently sat down with mobile in-game advertising start-up Greystripe to discuss the space. Company Founder & CEO Michael Chang discusses why the ad dynamic is so different for mobile games, the early success of the company’s consumer portal GameJump.com, and where mobile advertising is likely headed.
GamesOnDeck: In the console space in-game ads didn't make the games cheaper/free for consumers. They just created another revenue stream for publishers. You're doing free games with GameJump, but do you expect others that license your technology to do the same? Why?
Michael Chang: At Greystripe, we believe that advertising in mobile gaming and console gaming are for completely different reasons. Advertising in mobile is going to be the catalyst to drive a brand new, alternate form of distribution - free ad-supported. In console, like you said, advertising is for 'additional' revenue on their products which already have great distributions channels (Gamestop, Walmart, etc). What is revolutionary in mobile is that ad supported will become the total revenue stream for the publisher and the consumer will never have to pay. Yes, we are currently working on partnerships to bring our free, ad-supported distribution system to more gamers in addition to GameJump. Stay tuned for some big announcements before the end of the year.
GOD: Many companies report that they have been treading lightly around mobile advertising, because phones are so much more personal than TV or websites - they're seen as as very personal extensions of their owner. How does GreyStripe respond to these concerns? Do you disagree?
MC: We think that mobile advertising is so effective for exactly the reason that you mention, it is personal. People have been treading lightly because existing mobile marketing have been campaigns through SMS which is more like SPAM if it is unsolicited. What is great about pairing advertising with free games is that we have created a model that is inherently opt-in. The user downloads the game for free and they know that they are a going to see a couple of unobtrusive ads at the beginning and a the end of the game. This is a fair trade off. I think that model's like mobile in-game and mobile search advertising are going be the big winners because the are opt-in and ad value to the experience.
GOD: How are these ads being monetized/sold? I understand they can be loaded in front or at the end of game sessions, but what other options are there?
MC: Greystripe sells pre and post roll full screen ads. Like you said, our full screen ads are presented at the beginning and at the end of the game session. Because of our proprietary AdWRAPing technology, which can add our advertising software to any JAVA application and game, we have the ability to insert ads anywhere into the game play. We can show ads in between levels or as interstitials. We will do this once the game player becomes more comfortable with our ad model. We have been very careful with the gaming experience for both the consumer and for the publishers sake. The worst thing that we could do is to "interrupt" the game players experience. We believe that pre and post is a good balance for now.
Next: Selling Advertisers
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