Written by: Ayet Bayrami
Welcome back to the fourth and final part in a 4-post series throughout which we have explored some of the most essential elements to creating a successful game performance marketing campaign!
If you have not yet had a chance to read our previous blog posts, the overview below breaks them down by topic:
- PART 1: The Right Deal Metrics
- PART 2: On-Boarding Your Players Easily – Registration Flows & Landing Page
- PART 3: Making Use of Game’Types, Platforms & Genres
Finally, in PART 4, we will demonstrate why grouping countries into several geo-based tiers also has an effect on the desktop payout rates to the publishers, and will present you with two suggested payout guides, containing the most reasonable payout ranges for balancing the needs of game advertisers and publishers, included in our free e-book.
Tier Segmentation
Segmenting payout rates based on geographic regions is among the main key points that advertisers need to consider. As will be discussed shortly, not all gaming markets offer the same quality or quantity of player traffic due to several reasons. Naturally, these differences should also be reflected in the prices that these advertisers would be willing to pay. More importantly, it allows them to develop proper expectations about their campaigns’ returns, specifically in relation to their key performance indicators. Thus, the type of tier plays a significant role in shaping said KPI’s.
Before describing how they influence such payments, we will first list the aforementioned desktop tiers. It is important to mention that while the visuals below are based on iQU’s own client base in these specific regions, many of them are considered to be essential markets for most western publishers, in their respective groups.
Having said that, the desktop tiers are represented by, but not limited to the descriptions below:
- Tier 1: Most of Western Europe, the UK, Scandinavia, Oceania, the USA, Canada, Japan, the United Arab Emirates, and South Korea, among others;
- Tier 2: Spain, parts of Central and Eastern Europe, the Baltics, Russia, Turkey, Israel, Hong Kong, and Taiwan among others;
- Tier 3: Other parts of Eastern Europe, Latin America, Mexico, parts of the Middle East, South Africa, and Tunisia, among others;
- Tier 4: Indonesia, Thailand, Lebanon, Vietnam, parts of the Middle East, Jamaica, and Guadeloupe, among others;
For a more detailed look, check out our desktop tier guide map.
Besides desktop, we will also cover a similar type of country distribution for mobile below:
- Tier 1: Oceania, the USA, Canada, Germany, the UK, and Japan, among others;
- Tier 2: Benelux, Scandinavia, France, and Hong Kong, among others;
- Tier 3: Spain, Italy, Poland, Russia, Taiwan, South Africa, and Mexico, among others;
- Tier 4: Some parts of the Balkans, Jordan, Egypt, Brazil, and Malaysia, among others;
- Tier 5: Other parts of the Balkans, Haiti, North Africa, parts of the Middle East, and parts of South America, among others;
As with the previous case, you can also observe iQU’s extensive mobile tier guide map.
Next, we will delve into some of the various environmental reasons behind said tiers. While the following section will use examples from desktop ad campaigns to illustrate its points, many of them can apply to most mobile targeting efforts and their respective tiers:
Tier Rate Determinants
Firstly, the economic factors related to a country/region and its citizens arguably play the largest role here. As discussed before, the richer the target group, the more should be spent on acquiring it. Naturally, the users with the highest incomes, as well as those who are the most likely to be converted and to spend substantial sums on in-game items, are those within Tier 1. Thus, the payout rates for them are the highest.
Secondly, a country’s demographics also shape the payout level, particularly in the sheer number of people living in it. For example, the populations of several of the Asian countries in Tier 4 are much higher than, say, the Netherlands. This means that the payouts to the publishers would logically be lower as it is easier to attain more people, with respect to the other rule we described earlier.
Thirdly, a region’s technological development can sometimes act as a constraint to advertisers. One such case is the state of the Internet in Tunisia (Tier 3) which has been problematic for its citizens for some time now. From an advertiser’s perspective, this implies that there are not many dedicated gamers in Tunisia, so said advertisers would logically not be willing to pay high fees for obtaining such users.
Fourthly, certain legal instruments in some parts of the world can indirectly force the player acquisition costs to rise. This could very well result subsequently from the recently-implemented GDPR (General Data Protection Regulation) in the EU, for example. Said Regulation would make it harder for advertisers to keep the contact details of potential users who have not indicated a certain level of consent for doing so. Thus, it would be more difficult and costly for advertisers to initiate any additional (re-)targeting efforts, therefore raising the payouts, as stated earlier.
Fifthly, the combined numbers of advertisers are much larger within Tiers 1 & 2 than the other two. Naturally, the higher the competition, the less dependent the game publishers are on any particular advertiser. With such low switching costs and fewer long-term contractual agreements in this industry, this indicates that said publishers can choose to pick the advertisers willing to pay them the highest amount.
Finally, beyond these, factors like the game type and genre, the user registration flow and landing page type, and the agreed-upon deal metric should all be considered when deciding on a payout rate.
Thus, with reference to all of the preceding points established in this extensive overview, we recommend following iQU’s 2 exclusive payout guides for desktop and mobile, combining all of them and setting up pricing structures, which would not only satisfy both game publishers and advertisers, but drive their ROI. Access these guides today by downloading our free e-book!
As always, if you are interested in discussing how we can help you maximize your ad campaign results beyond the tips in our e-book, schedule a free consultancy session with iQU here!
