Hyper-casual gaming and monetisation

Gram Games’ Chief Revenue Officer Eren Yanik sat down with Adam Telfer to discuss monetisation, IAP and our Merge! franchise. Incase you missed it, the interview highlights are below.

How did you make the decision to make Merge Town! And how long did it take to develop?

Merge Town! was built on the merge mechanic used in Gram Games’ first IAP-based title, Merge Dragons! It was a simple mechanic that instilled a sense of achievement — the player experienced clearing the board and progress.

Merge Town! was developed over a few months. This included full development, soft launch, and other tests the gaming studio ran to see if it could stretch the LTV/CPI figures.

Gram Games were confident in the Merge! Mechanic as it had been tried and tested, but dedicated a longer period of time (about 6–8 weeks) to test monetization within the hyper casual game. It experimented by using a different number of worlds and levels and tested how and where players could potentially discover new buildings. Through this phase different variations of ads placement were also examined.

What is the more important consideration during design development — driving Session length or driving sessions per day?

Session length and number of sessions played per day are considerations surrounding monetization. Gram Games often selects different ad units to reflect the gaming style and resultant type of game. It finds an average user would see more banner ad impressions on a long session length game, but (depending on where you introduce the video ad interstitials) more sessions per day would mean more video ad interstitials.

Gram Games notes that session length tends to be constant over a user’s lifetime, whereas sessions per day go down as more time passes for an average player. To boost video ads through session length, there are different parameters gaming studios can play around for increased optimisation, while still maintaining player satisfaction. A common strategy is to introduce ‘reward’ videos during gameplay.

Why did you decide to integrate the forced Ad points into Merge Town?

Gram Games finds adoption rates are generally constant for banners and video interstitials, but can vary for rewarded videos (since they are user opt-in). Generally, the gaming studio finds there’s a correlation between adoption rate and impression per DAU. This is because the first is a key determinant of the latter. Since adoption rates are closer to constant for ad banners and interstitials, Gram tackles more impressions per DAU and CPMs (for which you’d need to work with ad networks and focus on the right geos to optimize).

For rewarded videos, Gram Games works to improve adoption rates by making them part of the core gameplay. Changing the user interface, making it more accessible, helps boost adoption. Once game updates are done, adoption rates become stable, which is when you can work to optimize CPMs like other ad units.

Ad driven games — are they the future?

Ad driven games often serve ads for other games that monetize mainly through in-app purchases, so ad-based games are operating at the low end of the LTV/CPI curve.

In the long-term, with viewability and performance measurement enhancements, more brands will enter the ads business, giving ad-based games the ability to act as “new media”. Unfortunately there is not much public information on ad game revenue figures, but some of them would enter Top 50 grossing games, even today.

Why the integration of ad points into Merge Town

Gram Games cites this is always a big discussion point before launching any new game. Whenever you introduce a forced ad in a game, it affects user experience and retention, but causes a rise in ARPDAU. Optimal points differ from game to game as shorter lifetime does not necessarily mean lower LTV. Some games end up at the more aggressive advertisement end of the spectrum, others less.

Comparing the metrics between two Merge! Franchise games

Merge Dragons! is our only game that does not include ads. Merge Town! is the one where we use video and rewarded ads heavily. Merge Town! is a much simpler game that uses the core mechanic of Merge Dragons!, but there is less of a long-term story associated with it. Therefore you get a higher short-term retention, but a lower long-term retention. As Merge Dragons! monetizes mainly through IAP rather than through ads, monetization is harder to compare. UX is more significant in Merge Dragons, as we aim for higher long-term retention to form a community of committed players.