Is it just a closed loop of game companies paying eachother or are they getting money from somewhere else?
In: Economics
I started my career in online marketing monetizing games. I have a longer career in tech and business. When I first began monetizing games was when Zynga was big and Facebook was trying to figure out how to make money.
The way we monetized games was either ads or purchases. Purchases can be micro-transactions, subscriptions, virtual currency transactions if the game uses a VC… Ads are driven by ad networks. The games don’t know what ads are showing on their games a lot of the time. They just have a spot for the ads to run and whatever runs runs. Some games will specifically forbid other game adverts. It’s not a simple and straightforward thing as everyone has a different set of policies. That said, around 12% of a game’s user base will monetize with some sort of transaction. The rest are monetized by sending traffic to whatever ad is shown, display fees for whatever ad is shown, download or other actions for whatever ad is shown…
Someone mentioned that games harvest and sell your data. I don’t know of any game publisher doing that. Facebook and Google know what you like and what you are browsing and they sell your data to advertisers (or help advertisers target you if you like what they are sellling). Game publishers are the buyers, not the sellers… They are buying traffic from the ad networks and the traffic they are selling to the ad networks is not nearly as specific as the traffic that FB or Google is selling. That’s not to say that no game companies harvest and sell data. Some, I’m sure, do. But your typical publisher is not that sophisticated and just wants to monetize their game however they can.
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