Games x Marketing: Only ad monetization is becoming difficult

In the interview you can find out what the marketing measures of a renowned games developing and publishing company like InnoGames look like, which AI tools and creator resources are used for this and what trends and hurdles the industry has to overcome in the current market read with Sebastian Goldt.

The interview

OnlineMarketing.de: Hybrid monetization (in-app ads and in-app purchases via games is sea ​​AppsFlyer one of the trends of this year. Do you see that in yourself too? Which models do you use to generate income?

Sebastian Goldt: The fact that games with in-app purchases also have in-app ads is not all that new. What is new is the trend that games that previously only monetized through in-app ads are now also relying on in-app purchases. This particularly affects hyper-casual games. For our own games, which are more mid-core, the focus remains on in-app purchases, even though we have started to integrate rewarded video ads in most games. The bottom line is that our sales from in-app purchases are still significantly larger than those from in-app ads.

The first few days are crucial for in-game purchases. How do you encourage users to make purchases? Are there any specific marketing or targeting measures?

On the marketing and targeting side, we try not to create false expectations, otherwise the players we have just acquired will quickly disappear again. In the game itself we have many different starter offers that are played out based on the information available to us about user behavior. The player can then choose the right one from among them. That sounds pretty simple, but behind it there is a huge amount of testing, analysis and decisions.

Casual ad spend is increasing, can you share numbers on any growth for you?

Our ad spend is currently rather stable. The majority continues to go to our flagship title Forge of Empires. Of course, we also allocated part of the donation to new game launches like the one from Heroes of History distributed. The iOS and Android versions recently had a global release and the browser version will also be released this year. We are very satisfied with the results of the first few weeks and are accordingly optimistic that we will be able to scale the game – and thus also the ad spend – next year.

To what extent and on which platforms do you advertise InnoGames and your games?

We use a variety of platforms, but of course we primarily focus on online channels. Here, for example, we work with Google, Meta and recently also TikTok, but we also use well-known mobile video networks such as Unity and AppLovin. We also successfully run TV commercials in some countries. At the same time, we are constantly testing new partners. However, the chances of success have recently decreased due to consolidation in the ad space.

In July you spoke of a “more difficult marketing environment”. Can you specify this and reveal how you approach this?

The first thing that comes to mind is the issue of data protection. It’s not new, but it still concerns us every day. Of course, we welcome the fact that data protection is now taken seriously everywhere, including in app stores and networks, but it doesn’t make it any easier to manage marketing campaigns. Mid-core games like ours also had and still have a harder time than casual games, for example, because our target group is quite small in comparison. We respond to this by trying to address new target groups and see whether we can go even further in depth or breadth within existing ones.

Another long-running topic is findability in stores. More games are released every year. This simple fact has enormous knock-on effects. And then there are other, less well-known trends. Market researchers at Newzoo report that 60 percent of the time spent gaming is on titles that are six years old or older. And only about a quarter of the time spent is invested in newly released titles. That’s what happens to us in games The tribeswhich is now in its 21st year. On the other hand, it is becoming increasingly difficult to motivate players to try out new games.

Do you now rely on proprietary AI models or enterprise solutions from large AI companies for marketing conception and creative creation and/or game development? If so, what is the basis?

We use numerous approaches and tools in game development, but it’s a broad field – and not for me. As far as marketing is concerned: When creating creatives, we regularly use various AI tools and also experiment extensively with new tools. But they are almost always enterprise solutions. Midjourney plays a special role here. For example, it helps us enormously to create new static creatives and to quickly visualize initial ideas in brainstorming sessions.

However, manual revision is always necessary before commercial use, as in our opinion Midjourney and Co. do not yet deliver consistently enough. Each creative looks slightly different, making it difficult to maintain a brand identity. Uniform and recognizable branding is also crucial for success in our industry. There are already solutions for this where you only feed the AI ​​models with your own creatives and can therefore ensure a certain consistency. The bottom line is that it currently appears that a person is the best judge of what appears consistent or is recognizable to a person.

You have a comprehensive cooperation program for business partners and creators. Can you give outstanding examples of successful collaborations?

To be honest, our cooperation program has shrunk over the last few years. In the past, it was mostly websites that signed up for the program and promoted our browser games. This has resulted in many long-term successful partnerships. That’s why I’m having a hard time picking out a single one here. However, today many of them already work with large advertising networks such as Google Display. We then control our advertising material via these networks. But as luck would have it, we are currently discussing how we can adapt the cooperation program to the current market environment so that it becomes more relevant again. This also includes consideration of setting up a separate program specifically for creators.

Do you have any new games in the pipeline and if so, will the application process look different in 2025 than before?

We actually always have games in the pipeline. As mentioned, just now Heroes of History has been released for iOS and Android and the browser version will follow soon, the next launch will actually take until 2025. As far as advertising is concerned, we will certainly rely predominantly on well-known advertising channels. The bottom line is that they work very well for us. Where we can and will do more is working with creators. So far they only make up a small part of the marketing mix. This also explains why we are thinking about a special cooperation program for them.

But we will certainly explore new avenues again. But they usually depend heavily on the game in question. A title like Heroes of Historywhich combines building strategy with Hero Collection, of course offers different approaches than an exploration and village simulation like Sunrise Village. Understanding exactly what marketing opportunities a new title offers us is one of the reasons why InnoGames integrates marketing into the development of new games right from the start.