This article is part of a Gaming Insights series paid for by Facebook.

Once relying solely on in-app purchase (IAP) revenue, Ludia, one of Canada’s leading mobile video game companies, has now implemented a hybrid model with in-app ads (IAA) across many of its internationally recognized games — and hasn’t looked back.

To understand how the transition to a hybrid monetization model helped catalyze game growth across their robust portfolio, which includes Jurassic World: The Game and Dragons: Rise of Berk, we talked with Rose Agozzino, Senior Marketing Specialist of Ludia. Ludia was founded 12 years ago in Montreal and has grown to employ over 300 team members.

Q: (Heath/Facebook Audience Network) What were the biggest challenges in moving from a pure in-app purchase model to a hybrid model, and how did you resolve that? 

A: (Rose/Ludia) Our biggest challenge was the fear of IAP cannibalization, since we’d mostly relied on in-app purchases. But as we integrated rewarded video and saw that players were still buying hard cash currencies, we realized that cannibalization wasn’t going to be a problem.

And even better, we started to see session times, retention, and engagement improve. We saw higher conversion rates from players who watched ads versus those who did not. At that point, we decided to start moving forward with ads in our other titles as well and haven’t looked back.

Q: Why did you decide to try rewarded video ads?

A: We’ve always believed in the value of ads, even though early on we were more focused on the in-app purchase model. In our first few forays into testing rewarded video ads, we took it slow and gave ourselves time to prove the KPIs and get comfortable with this format. We learned that rewarding players in the very moment that was useful to them resulted in increased player time, longer sessions, and increased retention. And that encouraged us to keep testing and learning with rewarded video ads. 

Q: Can you offer too many rewards or too large a reward?

A: Our approach to integrating ads in the in-game economy has evolved since we started adding rewarded video. At the very beginning, we offered a pure monetary exchange, where we’d associate a quantity of hard cash in exchange for watching a video.

Then, the player would go and spend the cash anywhere in the game. When you’re just starting, this is an excellent way to test rewarded video ads.

But if you want players to get interested in their game experience, we learned that it’s better to offer a contextual reward (versus hard currency) based on where they are in the gameplay.

For example, in our Jurassic World game, we have battle cooldowns. Instead of earning hard cash, players can watch a video ad, reducing the timer, essentially providing a free entry into battle. This catches them in a context where they may not have paid, but now that they’ve been offered a free entry, they’ll take it.

Q: How do you avoid burning out players on monetization when offering them ads AND in-app purchases?

A: To make sure we aren’t burning players out, we do some A/B testing and check the frequency caps. We also look at where players are in their lifetime player experience, which KPIs are improving, and where they’re spending their time and resources.

Overall, a well-balanced strategy should enhance IAP if you plan your reward strategy appropriately.

Q: How will you be using bidding as a way to test ads?

A: We are currently testing bidding. We integrated a mediation service earlier this year.

One of the nice things with bidding — considering how geographically diverse our players are — is that we see different eCPM rates vary based on where players are based.

Bidding has allowed us to see how the networks value each user without having to develop pricing floors over and over again. We are a small team, and this is saving us a lot of time.

Q: What are your top three tips on incorporating ads and balancing your in-game economy? What advice can you give for those looking to get started with hybrid monetization?

A: First, don’t be afraid of ads. A good ad strategy will only enhance your overall performance.

Second, when implementing rewarded ads, ensure that different placements integrate different rewards. Make sure you engage your players in all points of your game. If they aren’t engaging in one spot, try and offer them something else.

Third, think about adding ad placements at the design stage, rather than trying to shoehorn them in once you’ve shipped your product, and your game is live. You will be less worried about cannibalization if you’ve designed ads into the game flow.

Dig deeper: Check out the entire Ludia case study.

For top success factors on building rewarded video ads into your hardcore or midcore mobile game, see Hardcore and Midcore Mobile Gamers Like Rewarded Video — if Done Right.

For guidance on testing ads in your game, download our Guide: 7 Steps from IAP to Ads: Supercharge Your Game with New Revenue Streams

Heath Schindler is Strategic Partner Manager at Facebook Audience Network. 

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