Ad monetization

Do high-CTR playable ad units work?

By John Koetsier October 20, 2023

Earlier this year I wrote about bad ads: high-CTR playable ad units that refuse to disappear, that interpret every touch as a click, or that crash the game you’re playing. The concern I had at the time was the tragedy of the commons: bad ad experiences ruining the mobile ad ecosystem. The question I didn’t answer at the time was: do these high-CTR playable ads that pop up insanely high click-through rates actually work?

In other words, do they achieve what advertisers want to achieve: installs and revenue?

High-CTR playable ads: data

Recently for a webinar with Kaizen, I had an opportunity to pull some data and analyze it for insights to exactly this question: do bad ads work well? Emotionally, I wanted the answer to be no. But I also wanted to let the data speak. Here’s an overview of what I found.

The data was from a campaign for a mobile gaming app:

  • 88 million ad impressions
  • Mix of ad partners including search, big social networks, and SDK networks
  • $110,000 in spend

Here’s the first thing I found:

  • High CTRs are correlated with low CVRs
    • CTRs in the 60-70% range got CVRs of .4%, .6%, 1%, or even .07%
    • CTRs in this range generally originated from SDK networks
  • Low CVRs are correlated with high CVRs
    • CTRs of .5% or 1.5% are associated with CVRs such as 18%, 28%
    • CTRs in this range generally originated from the traditional blue-chip big platforms

The obvious question, of course, is whether a much higher CTR — even with a much lower CVR — result in similar performance?

A simplistic example: 1,000 clicks and 100 clicks look very much the same in the end if the conversion rate is 10X on the 100 clicks compared to the 1,000 clicks.

high ctr ads

It turns out that the answer is yes.

I looked at the ratio of impressions to installs and installs to impressions to see how many impressions were needed from a particular network in order to get an attributed install. The result: 2 of the 3 SDK networks with high CTR playable ads actually do have higher install rates per impression than traditional large platforms.

And not just by a little: between 2X to 6X.

Wait … what about revenue?

I wanted to take it a little farther: all the way down-funnel to revenue. Does this still hold true?

So I compared the number of top-funnel impressions hitting people’s eyes to bottom-funnel dollars: money in your pocket. The question: how many impressions does it take with different ad networks to end up with $1 of publisher revenue after a player clicks an ad, installs an app, and converts to some form of revenue?

The result: for this campaign, most of the high CTR networks required fewer impressions to drive positive ROAS.

Far fewer.

high CTR playable ad units

That is, of course, why they’re doing what they’re doing in high-CTR playable ads: multiple clicks with multiple invocations of SKOverlay.

But … there’s a big caveat here

Comparing ad units is not always apples to apples.

Most of the ad units from the SDK networks were rewarded ad units, generally with playable ads, and pretty much always with aggressive end cards, which monetization expert Felix Braberg says are almost more important than the ads themselves. Many of the ad units from the traditional big publishers were banners or videos with much less aggressive end cards.

Rewarded ads have guaranteed engagement.

  • They demand more attention (you have to click out of them)
  • They receive more attention (you might play them, and you pay at least enough attention to get your reward)

The other big caveat: I’d really need to look at much more data to draw very detailed conclusions with a high degree of certainty.

What I can say is that there’s definitely a reason app and game publishers are using high-CTR ad units. They may not be the healthiest for the overall ad ecosystem, or for consumers’ impressions of advertising and app monetization based on ads, but they do work.

Want to see the full webinar?

If I may say so myself, it was a pretty good webinar with high-level participants, including:

  • Claire Rozain, Carry1st
  • Felix Braberg, 2 & 1/2 Gamers
  • Adam Gray, Nimbus
  • Tomas Yacachury, Kayzen

Check out the full webinar here.

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