Mobile Ad Revenue in 2021

hello everyone and welcome today we'll be talking about mobile ad revenue and monetization and more specifically we will discuss what will happen in 2021 including the potential impact of idfa deprecation of course to talk about these issues we have with us a good mix of ecosystem players in the industry first representing the smaller indie studio we have josh chandley ceo of wild card games in indie mobile game studio building classic card games next we have sophia giliazova head of ad monetization at social point the mobile games division of take two and obviously you guys have a lot of great mobile games that i've been playing recently and finally offer yahoodai who is president of fiber fiber builds monetization platforms for mobile game publishers and for all three of you welcome to the podcast all right so just jumping right in i think the thing that's

of most relevance and that people are interested in is this in terms of ad monetization trends for 2021 is the impact of idfa deprecation so maybe we could just go right off the bat and start there maybe josh yeah i mean definitely i think cpms are going to go down i don't think that's a huge surprise to anybody um that said i think there's a lot of panic in the market right now people are very anxious because we're all anticipating this change but we don't have a lot of um ability to take action and iterate right now so definitely a lot of anxiety that said we do we do have lat users already on ios so i can share a little bit of data about what wildcard's seeing so far in december interstitials we're seeing down around 55 um rewarded is 60 and banner is uh 70 which is way way it's huge

um the asterisk there is the lat is much lower volume than non-lab so we are able to spend a lot more time optimizing our non-lat revenue which means those could be a little exaggerated additionally um there's a ton of factors at play here seeing video down 60 i don't expect to see video down 60 post idfa um three things um that i i would think about is right now look lat there's a there's a lot of players missing from the market um facebook audience network does not bid on lat traffic fan is about a third of ad revenue for most non-lap and second not all users are going to be lat if publishers go from 15 percent of ios

impressions on what to 80 then maybe only 60 will see this decline and then third and this is a bit more speculative i'm curious to know what sofia thinks um but if demand for for non-lat traffic remains high and supply of lat traffic non-lap traffic is low what happens to those cpms are those going to spike up i mean those are my first thoughts absolutely thank you for a question josh well i i think i tend to be more positive in general uh also i think i've been you know through we all been through through pandemic and we've been through ecp and drop on pandemic and uh specifically here at social point we managed to kind of turn it around for us and actually see increasing that revenue during that time uh therefore i'm a bit more calm right now that maybe i could have been if without the pandemic but

i think that um eventually we will end up and either net neutral or even maybe uh well in the long term in the net positive um i take it well i have of course like kind of a positive and negative outlook on this and like negative one i think it's more closer to what you josh said right that you know everybody will be in panic a lot of advertisers might post the spending a lot of advertisers uh you know just push spending to maybe other sources and anything can happen and it's it's a lot of uncertainty that is coming but on the other hand what i think is would happen is what you already said is that the the users that will still have ldfa available will potentially be worth more just for those advertisers which are maybe tend to be more conservative and they're still really really want to find this uh high-value idfa available users therefore if if we manage to get those uh let's say uh killer whales or

ad whales which are actually uh have idea fail available those will be worth more and maybe i'm just way too positive on this but this is exactly what i'm pitching to my product teams all the time so that we keep testing the prompt um and on the on the other like positive side of things um i do believe that android marketplace in the short term would be actually performing better we've seen a similar trend when uh apple banned cp offers on ios we've seen almost nate neutral eventually a revenue impact so i'm kind of crossing finger that in the short term when you know everybody goes to panic some advertisers will probably pause but some advertisers maybe will actually jump on the opportunity and try to buy something buy on ios and actually buy on android a lot um again challenge me in my positivity but uh this is what i think is going to happen no i i totally agree i think the worst

likely case is that 60 of impressions take about a fifty percent haircut um which means in the short term it's hard to imagine worse than a thirty percent decline to me yeah i want to offer maybe i agree with you guys but i would like to break it down i like to break things to to to you know to smaller components you know i don't think this is a singular event meaning the day this will happen let's say march like the current rumor like yeah then we'll start the process that will have several steps and the first step will be the actual shock not the shock of a last summer when apple just said but the actual shock when we start seeing those led numbers going up to 60 to 70 20 god knows but it will go up right um i'm afraid what will happen then and i would love to hear from you know you josh and sophia i think some ua marketers will start to slow down their

budgets just in case just to see what happens which may create this in a ripple effect of like a pull down in the market but i am optimistic like you that in a matter of a quarter or maybe two we'll go back up again because we'll see okay it's 16 out of 60 percent and we can make it happen so that's the first thing there will be shock pull back and then recovery and when the recovery will happen it will not happen in the same way for different genres like i don't see hyper casual in social casino recovering the same way you know some say that hyper casual will be more impacted you know i have a different view i look at how advertisers are targeting hyper casual and it's mainly category targeting like the tap tap tap jump type of games etc that's the audience i want i don't really care about offer i want the people who play these type of games social casino mid core i am looking at the top spenders the first deposit

etc that requires deeper targeting these guys not sure what's happening with you guys so we can't look at the market the same way so we have to look at different genres i actually believe we'll see a dip hyper casual will come back casual will come back and then we have to see what we're doing with the most sophisticated buyers okay and just to kind of get a sense of what you guys think from more of a specific impact to like if i'm a publisher and i'm trying to model the impact of ad revenue loss for my business josh you're saying something like 30 percent sophian offered you guys what what do you guys think in terms of ranges for publishers to think about as they're trying to plan for 2021 well i think that um offer brought up a very good point about the difference in genres so i think you cannot just give like the answer for all the genres across all the genres like hey guys it's gonna be minus 50 no it's true it depends on how niche is

your game or or what type of audience are you targeting if you're targeting massive audience you might not see really uh you know a very big damage because you you will be able to yes your cpus will decline but your cpi's will decline as well the question is what declines more you know so i don't think i can really give an answer i think it can go from minus 40 to zero eventually it depends depends on what what is your game what genre is your game and what type of audience is playing your game and actually how big is your game as well i would also throw in it's your ability to to react um because when sophia talks about potentially a negative 30 negative 40 percent she she's not actually saying add ltv or ad revenue she's saying cpms and there's a lot of things that you can do especially if you're if your ad monetized primarily on let's say interstitials

or banners or system ads in general with system initiated ads you're essentially spending your retention on monetization if you're receiving less revenue for spending your attention perhaps you should show less ads i mean i think the most sophisticated um uh players are doing a lot of ad frequency testing and that's based on the cpms that they're receiving um rebalancing that um will probably mean that they're going to show ads less frequently have better long-term retention and not experience a full 30 percent decline i mean i've seen these a b tests when you measure them out to d90 i've seen in my own games forty fifty percent gains so i i think it's um fair to say if a scenario where a publisher is impacted by let's say thirty percent their cpms i think it's

very unachievable to get to negative 10 negative 15 um to your actual ad ltv within a couple of months as long as you have the ability to run sophisticated a b tests i can take you back and if i look at some data like mediation-wide data for the past eight weeks i see a trend and the trend is encouraging because eight ten weeks ago when we compared the performance of a la traffic to non-la traffic the gaps were staggering like you know 10 cents for the dollar like th that's when all the doomsday a predictions came but luckily enough the graph of led performance across the board and agree sofia again i'm averaging here started to climb and go up and up and up in the last seven days we are around 60 cents for the dollar so yeah minus 40 or so i mean i look at the trend not that not the actual number and the trend is that more and more buyers become more sophisticated and using more tools to actually yield more

out of led traffic i don't foresee that we are you know coming on par to exactly 100 but we don't have to to your guy's point like because the media is also cheaper than you know again the cache ltv cycle it works if we'll end up at like 70 75 cents for the dollar i think all in all it's not that bad it's not that bad uh but but still led traffic a worldwide is around 30 40 on ios 14 so we need to see what happens like how fast and how much it goes to see if that formula holds up yeah i totally agree when we compare our traffic which is of course we have led on traffic already we do see that if we compare purely cpms we see minor 30 percent so they monetize 30 worse but again as offer said it it's just current situation where people do not really buy a led on

traffic or there is no nothing no no advanced tools which are actually used to buy from there so that's why i probably i'm being positive and i think is there is also something important we maybe should mention is on the brand side because at least for social point we've been benefiting from from brand advertising quite a lot and it's not necessarily even direct we don't have a direct sales team that works in brands it's actually working with branded networks um and we've noticed an incredible influx of brand networks after pandemic which i think actually quite a industry-wide uh trend what i think will happen is in 2021 i don't think brand rents will subside because look we have olympic olympics which didn't happen we have finally the movie production which is starting again even if you look at these type of trends even if you look into e-commerce which probably during the pandemic times they understood like that the pandemic has changed consumers right they change consumers habits

shopping habits so clearly e-commerce is becoming a norm for everybody therefore i'm quite positive that we'll have a lot of brands also to compensate which was what a luck idf independent what do you guys think i think you just start you touched a very important trend by itself no seriously which is you know 2021 i hope we start seeing much more brands now you know i i'm old i've been a i co-founded interactive in 07 and was pitching you know brands for mobile in 08 in barcelona in the mobile world congress so we've been waiting every year for the brands to step in uh but i do agree and feel like this is different funny to say it but you know thanks to the pandemic or thanks to kovid i think marketers are now fully appreciate what mobile gaming really means right and that that's something all of us were waiting for such a long time not just the you know not just user acquisition but actually brands understand

that there is value in meeting their audience while they play a nice casual game or they engage with you know a more deeper game this is a a full all-in experience very different than you know tv so by itself i think it's it's a trend we'll see more networks we'll see more buyers we see new technology like in-game placements that is now starting again uh all of that is definitely very interesting and we have to follow very closely and so if i'm hearing you guys correctly basically cpm's probably dropped by 30 or more and i've heard a you know pretty big range in terms of the what the or more could be but to kind of sophia your point then also cpi's decreased so from a roast perspective you've got to see how that kind of nets out and josh to your point even if cpms go down if you're trying to model what the impact your ad revenue is there are other things you can do such as rebalancing how you surface your ad ad frequency things of that nature

but could you guys talk about are there any other things you could do to josh's point to help offset that loss in ad revenue what are other things that mobile game developers or publishers should be thinking about josh i don't know maybe we could start with you if you have any other thoughts yeah i think offer and sofia nailed it with the brand advertising um they're you're not going to get 100 cpms off of brand but you're going to take a lot of um those ads that would have filled at two three four dollars and bump those up to eight nine ten dollars and rewarded and maybe five six seven understational um that that's on mass that's big uh that makes a big impact um i also think that um there are a lot of people who don't run remove ads iaps um whether that's iep or subscription um the margin on

those is certainly improving if the or the theoretical margin if um if cpms decline i think those are all big but the biggest one i think is just doing tons of a b testing around frequency for interstitials um we're seeing still banners being the most effective so if i was showing banners i'd be very curious to know what it looks like with my game having no banners showing um and then for rewarded video what you're offering maybe trying offering slightly less could be really interesting one other thought that i'm kind of curious to hear from offer especially is so let's say this happens we hit a 30 um revenue cut if you're monetizing is with ads and we're expecting this smooth path upwards of cpms is that a ua buying opportunity for an

ad monetized game so you you want to say yes right because you think about it as a market and you say hey this supply just become cheaper but the the problem is you know lack of idfa is primarily affecting marketers you can't do retargeting you can't earn a suppression list a frequency caps becomes a challenge so the question that i cannot answer professionally is like will it be cheap enough is thirty percent decrease is enough to compensate the lack of targeting can i use contextual targeting to properly run campaigns and make my hit my day seven or less right or whatever the kpi is this is a question that's why again i think this entire a change will be modular we'll have several steps we'll have to see there'll be shock and then we there is recovery but i i want to add one step for for all publishers which i know nobody likes to do it and i know george you just shipped your last build

before the end of the year but between now and march make sure all your sdk partners are up to date but like really up to date and don't get mad if they ship two sdks in a month it's not bugs fixes and now speaking on behalf of the industry there are so many things that you know all of us are learning and apple are changing or facebook are moving and we have to make changes and it's sdk not everything you can do server side unfortunately nobody likes to ship or integrate an sdk but you know if you get if you have the latest sdks you are more likely to use like the latest day privacy apis contextual targeting or whatnot and those small things really make a difference seriously uh you know give or take five percent from the from the down of 30 we all need that so get your sdk in place yeah strongly agree um i just wanted to say add in there like

just like us the publishers who need time to like run tests and work on this stuff what i've been hearing is that they need time getting this data passed back to them so that they can figure out how to use it most effectively um so if we're if we're pushing those hard that can help reduce some of the the odds of the most negative outcomes in march or april sophia did you have any thoughts on this um yes well to to complement what what the guys already said i think that eventually this type of turbulence in the industry which happens every year always there's something happening uh it does urges us to go into kind of innovation also in terms of revenues and monetization i want to discuss now rather like advantages inside of uh side of things uh you know we're so used to to monetize with performance networks with uh facebook admob all these guys that you guys know and now the industry is changing so we have to look for ways to

to find other ways to monetize and in a way it's a fine challenge i actually like it uh it also changes my job description it changes my all the challenges i have and i find it great to be honest so for example we started working with surveys last year and this was rather a consequence of um overall being banned on ios and wanted to make it very fair to our users to have uh an equal amount of gem sources and which are not ieps on both platforms so we actually weren't at them and running for revenue we're just rather we wanted to be fair to our community and now we have so many different ad formats on the market like offer or dimension in-game ads that are just everywhere right now and there's many many sales features going on but i find it really cool i mean it's great it's a very native format and as long as it's of course travel free we can try we can try it out we just have to learn how to how to treat it how to measure things and

how to create benchmarks audio ads is another trend which actually we are now uh talking to because we're curious and i find it great because all of these formats are idfa independent and it's branded eventually it's something new for for the audience i think also for the users it could be an interesting challenge because you know they're used to see rewarded video they used to see banners and interstitials especially thanks to hyper casual but now we're moving to a different direction and ios users will actually be able to experience a completely different uh feeling of from advertising and maybe this feeling is actually better than it was so i thought in terms of another trend for 2021 that we could talk about is this topic that a number of folks have been talking about but i'm not sure if a lot of companies have yet adopted which is greater integration of product and ad monetization or marketing teams generally and so wondering if you could talk about anything that you guys are seeing or

that you yourselves are doing within your studios i can talk a little bit about it i i'd be much more curious to hear about sophia as someone who's at bigger scale i think this has been a trend for a really long time now one of the ways that wildcard's been able to grow is by having that tightly integrated team where product is looking at potential ad monetization improvements through the same lens as iap or retention improvements um and and we've been able to build because of that being able to prioritize our ad stack uh whether that's adding lots of competition or implementing the ability to run those really cool a b tests i mean we're definitely seeing some weird stuff where mediation is trying to take over things like user testing frequency testing i believe iron source is a way to test nutritional frequency out to day seven but really the really cool stuff

wild cards run tests to d90 d120 and beyond and we make really really interesting learnings um about what you can do to really make a ton of ad revenue if you had that very long term view but that requires a product team investment um so sophia what's it been like for you at a big company out of the company also that primarily makes games which are iep based so yeah that was quite a ride since since the time i joined in 2018 i think we've we've improved a lot i'm very proud to see this because uh we are we've been making very very long term very long lasting titles which are iep based but currently we have a very substantial amount of revenue coming from ads and i see it as a very very big success and i to be honest the props of that is actually thanks to to product teams because we've started working with the products

very very closely and maybe i can give you like a couple of practical advice which which worked for us and you could potentially try to implement if you like uh so one of them was for example well education and by education i mean creating improving the t-shape between the teams so we've held a bunch of workshops for all the product teams to actually explain what ad monetization is and what are the kpis which are controlled closer to a product for example like engagement rate or frequency impressions for engaged user and ecpm when it comes to us right where we handle and work with third parties so that was a very big step for us and of course we had also been educated ourselves on our team on that quantization team we learned what product is doing what are their kpis what are their okrs and what are they looking for so that helped already quite a lot and the second step we've done was to have somebody from the product team

ideally a product manager or liveops manager to be partially responsible for uh the content which is directly impacts advertising not ieps or well ideally both but uh still advertising at its best and that worked for us a lot and uh well the last important part is of course okrs so or or goals your targets that are shared between products and ads teams that was the best because you can easily see what you are going to achieve what what are you actually striving for to achieve we've been participating in all the brainstormings and the product team always participates in our brainstormings and i think i see so much synergies coming from me that i wish there could be like i wish i could be more than just one person to participate in every every studio's uh brainstorming to help them with liveops and everything but clearly it's impossible uh but that's i guess the challenge of the big company that at some point you understand that

you are not able to completely help or to to learn a lot about every prototype about every game uh but this is why we're expanding the team so this is how it actually worked out for us i can definitely say that this is the trend i mean most of the conversations with publishers today are with the product team the admin team the ua team it's not you no longer just negotiate you know with just one of them it's it's a group effort and again it's it's always the little things right i mean a an admon person can can add a new network that will increase latency and that latency will you know increase churn and then the ua manager will freak out why my d2 dropped you know it's it's those small things even before day 90 josh it can happen like overnight so yeah i think we are breaking the silos and we're working together as teams and that's why even monetization tools like fiber iron source josh and others are starting to introduce tools for the ua guys not just for the

edmond guys okay cool so maybe the next trend of 2021 that we can talk about has to do with data now there's a lot of rumors flying around about various things going on but in terms of access to data which becomes increasingly important just given what's happening with idfa can you guys talk about what do you think happens to access to data both kind of supply and demand side in 2021 starting with you josh yeah um so on the demand side i won't talk too much there because that's still a black box to me in terms of how much we're really going to get we're waiting to hear from apple what they're going to give us essentially um on the on the supply side um yeah access to data is critical um all of these pri these prior trends we've been talking about you know like surviving the idfa apocalypse um

like rallying product and admon and ua teams together is one it's all about using data to overcome these tough problems and the teams are thankfully we have this ad data we have ad revenue data just like um iap data you know when is it when there's a transaction we kind of get a receipt from the mediator so that data is really valuable for running those a b tests and seeing if these things are positive um you know it does adding fiber um you know grow your admon stack grow your ad revenue and it did for us it was really great the bad news was sso far as being that that data specifically how much an ad network has paid to show a specific user an impression is very valuable and it appears that some networks would like to have

the monopoly on that data essentially they they do not want us to know if there are ads showing in our games and if there are how much we're earning for them which makes it very difficult to um to run those tests fan is definitely one that comes to mind that's very that does not want to hand over that data um so yeah that's definitely a big issue that poses a big risk it certainly comes across as someone that's you know obviously not in the mediation role it comes across that fan is leaning quite heavily on the mediators you know because their role the role of a mediator unsurprisingly given their name is to host fair and transparent auctions you know however fan is 25 30 percent of ad revenue for most publishers um if fan were to pull support for

bidding on a mediator that would probably make it hard for that mediator to compete the net effect is facebook at least could exert a lot of pressure on those mediators to perhaps do what's in the best interests of them uh rather than their stated goal of fair and transparent mediation so the question is how do you tell if that's happening the canary is basically if you serve 100 ads in your game and 20 of them were by by one network say facebook for instance facebook bidding um and so 100 ad served 20 to this network and you only get back 80 receipts that mediator may have been a little bit compromised um by that ad network uh any publisher that monetizes with ads

should be asking their mediators that question pretty specifically you know do you get all those receipts back um because if you don't especially with a big network how can you run those those tests to react aggressively to idfa that's really important you know so wildcard right now we mediate with max we've been really impressed so far they are actually as i believe yesterday passing back all ad revenue data at the user level more estimates at least which is really really helpful so that's been a big deal for us and those are my initial thoughts i'm really glad you raised this point josh clearly this is something that i think we all should talk more rather than less and it's actually the topic i i never hear on any of the you know podcasts or anywhere uh i do believe that all of us the publishers and the big publishers the

small publishers we we are a lever to kind of tackle those questions and at least challenge these type of networks on on the sharing because you know we've been going towards transparency we've had ad revenue data per user then we had impression level data so we've been going the right direction and now it feels like we're stepping backwards apart from ios i don't want to start that so uh but but the second force like you mentioned is mediation platforms and those are huge players which can also also put a pressure and i guess here i will redirect to you offer because you're perfect here i would be very curious to see why mediation platforms do not do anything or maybe they just don't do enough or they did already but it just didn't work so many good questions this is like this topic would be two webinars by itself i think if i look at the mobile game publishers it's one of the

only industries where you guys as a publisher you don't know which ads are running on your games and how much you're getting paid not because the mediation platforms don't want to tell you most networks unless you're running like a good programmatic exchange the most of the sdk networks not all of them and you guys named a few so excuse me if i won't repeat but they don't want to tell you trust me i think we are trying to echo your voice but the publisher has direct relationship contractually with the networks the mediations don't we don't have a a contractual network a you know relationship with a network we just you know we help them out but i think publishers should say guys i want to understand in real time if possible which campaigns are you running which creatives are you running how much am i being paid per each to your points i wanna i wanna manage frequency per user maybe i don't want to show this type of creatives maybe i don't want to show ads that are paying less than my threshold

a most programmatic platforms will enable you to do that but problematic is still 30 40 of the pie not even not enough i mean it's we are getting the trend is positive but that's not enough now um idfa0 lab traffic may change the picture for some networks uh like fan that you know don't really like to bid on non-idfa traffic so that's that's an open question what will happen to the 30 percent josh that you mentioned if ios 14 and and la traffic will increase will they be as aggressive as today i don't know it may change it um there are two there are two more hidden points sophia and and it's about because data became so important we've seen accelerated consolidation in all sides we've seen publishers acquiring publishers to get more data more idfv more rich we've seen networks are buying gaming

companies because that data also means experience if i know what's working for this type of game i can make my game better as well and vice versa so the question i ask myself is when or where will we draw the line and say what's happening here is my data helping me helping you helping them like what's exactly happening that's something we'll have to unveil also next year yeah i think it's a super tough problem i think that uh when it comes right down to it this is a transaction between two parties you know there's a mediator in between the transaction between two parties uh i think that sometimes the publishers don't want the networks to know things and think it's their data and sometimes it's the opposite but the truth is that both parties have the right to know a if there was a transaction and b

how much money changed hands it's not really like the the realistic outcome is not that only one of those two parties gets to know so it's not super likely to me that that's gonna be how it should work out at least um you know if it went to court i don't think there's a judge in the u.s that's gonna say companies that serve ads don't have the right to know if they've served an ad that's kind of weird and i think it'd be weird if they said companies that buy ads don't have the right to know if they bought ads that's weird too so i it really is a transaction between two parties um you know networks do play a big role as well in mediators um programmatic like offer set is huge actually um that's been a huge area of growth for us this quarter a little plug for offer here um we weren't sure how big programmatic was when we implemented fiber um it grew to over 10 of our revenue really really fast

and it was mostly net new revenue growth uh i've been shocked with the programmatic quality we've gotten through them um the reason why to bring it up is the the weirdest thing is the um most of our cpms are in like that 10 to 30 range our top floor with fiber is like 200 because they found this pocket of people that everybody just wants and you can only get that with programmatic so having some good programmatic leaders in there that's been a big learning for me over the past quarter okay and i think we should talk about programmatic next but maybe before we jump to that uh josh to your point i like the way how you characterized you know kind of the transaction between two parties but it does seem like in 2021 that there will be an increasing battle about who owns that data and so i can certainly see that

those conflicts and who has access or who owns that data will kind of increase in 2021 but maybe one thing that i can also ask you about offer you mentioned idfv and that seems to be a very contentious issue depending on who i talk to you know i think zynga publicly we've got some of their management executives mentioning that you know they don't specifically say idfv but they basically say that idf's a big is going to be a big deal for them they kind of use that as a justification of their acquisition of relic for example but in your view how important is idfv so i can start and i like the guys uh follow up i mean look if you look at the at the notion and the spirit of apple's privacy policy what they keep saying is that you cannot share data with other sites or apps owned by other companies like that's

that's the gist of it you can share data with you know other properties owned by different companies so this consolidation move you know to some degree it's the data is now owned by a single company now is it idfv is it a publisher proprietary id now it now it's less i i think again it becomes secondary because it's the same company apple doesn't say that you know a social point between their apps cannot share data it's it's the same company now in your example of zynga now they own a lot of studios it's the same company and we actually seen them changing like you know rollick to zynga and the publisher name on the app store that's that's a very strong indication now i can't speak on that on behalf of zynga i don't know what they plan but again just by looking at what apple is trying to do that's why i see consolidation you know such you know takes a big part in 21. and yes there are conversations about idfv i don't know when when you read the

language right now you should use it only for you know your own analytics everything that is inside the publisher data don't share it with others as long as you do it you should be fine and again just another reason to go and buy more if you can great insights there um i i personally have a lot of ambiguity i feel that the value of idfv is still quite hard to measure i mean it's currently an unexploited resource right it's this new tool thing that we have to play with i know it's been around for a long time but it was never the the right thing to focus on compared to idfa so for me the jury is still out and how valuable it is it certainly has value but it doesn't it doesn't allow you to do some things like bid and share that knowledge quite as helpfully so i i'm really curious to see

how helpful it becomes over the next year yeah i i i have to agree because i think idea three indeed is not the solution at least we don't see it yet uh it might become but we feel like you know the the consolidation trend that we've been speaking about in my opinion it's fostered of course by this but also by the fact that the bigger company they just want to grow right and and other ways of growth have it have the limit and what what i think will happen is that with uh ios changes for smaller companies it's just um it's just a way to survive to kind of look for the expertise and if you have a great game you have a bunch of great games and you're a smaller company you need expertise on how are you going to continue on ios eventually it's another factor pro the integration or pro acquisition so that company will be very happy to be acquired eventually so there are two trends where you know the bigger company want to grow the smaller company want to have expertise

and want to survive which eventually i i believe will see much more uh consolidation and much more integration trends in the future and apple actually helps to to uh foster that okay and so maybe we can now talk about programmatic bidding heading into 2021 and the potential impact and josh you mentioned this notion of cpm hotspots can you kind of explain that a little bit more for for folks in the audience who may not be aware of what you're talking about specifically yeah um so i'm gonna i'll do a quick overview of what programmatic is a little bit versus traditional like what you would call a sub pub bidding um which is what a lot of other networks offer um offer correct me if i butcher it i apologize in advance but essentially um with programmatic betting um while the actual application and the placement itself is a factor

they are looking at the actual user they're buying um the right to show ads to not the app they're going to show ads in and what that allows the advertiser to do is target exactly that person so practical example here is i i make games for your mom and for your dad they're old they disposable income and some of them especially right now want to stay home and spend tons of money on slot games if let's say a scatter slots or some large casino social casino company wanted to bid on my users uh through applovin or ironsource or unity ads they would be bidding on all of my inventory and that means the bid that they could offer would be diluted one of the things we've seen integrating fiber is that we can genuinely just set

price floors that i thought were ludicrous the 200 price floor is quite intense but for some players um especially for sophisticated um at ad buyers that know who they want 200 is cheap and so hot spots conform for you know a half a percent or one percent of your user base alfred did i butcher that or is that okay you know we are hiring josh maybe you should apply it doing a great job no it's exactly it i mean i mean um you don't want to price a a a billboard you want to price you know a specific a user so uh so that that's about it i mean i think the trend for 21 and i know josh that you are you're also advocating for it is actually moving away from a waterfall mechanism where you have to tediously create those water for those price points and flow prices and create a single auction

which reduces latency and then you know all the participant buyers and bidders can look at the opportunity place the one bid if it's 200 or 20 depends on the the impression and it removes a lot of the friction i'm sure josh you spend time setting up floors and and and trying new prices and i doubt you enjoy it okay so i know that it's it's been gradual um again all mediation platforms will be happy to to move towards a fully uh bidding mechanism um yeah i will stop here i think that's something that you know most mediation should should definitely want to push to yeah sophia any thoughts well uh programmatic that is really hard to add anything after those two experts to be honest uh i think that we all know that in 2021 ios programmatic is under a threat

clearly uh i feel like that well i feel like we're coming back again like to i don't know kind of pmp deals or white listing situation and it's definitely not what we really want uh for both sides of our business for for our revenue and for user acquisition but i guess this is just a reality i do believe that uh for a bigger companies will benefit more out of this because we clearly were a big marketplace we have a lot of users we uh we probably would be more noticeable than the smaller publishers which in my opinion is just unfair but um yeah i guess that's that's what i think will happen you know it's a good question sophia i want that you know we we also ask internally and what will happen to programmatic embedding if you know not if when idfa will will start to to go away and like always i i don't have a clear cut answer here because again it's going to be a process

however a i am building more and more confidence into contextual targeting uh that you know some are now trying to to build up and that that type of contextual targeting allow you to describe the impression without giving out an idfa not as a fingerprint not by i'll give you enough data points so you can complete the picture no no not about that but actually providing valuable data for the marketer for example this is the fifth impression of the user in this you know this session like impression depth um here here is the last advertiser or the last creative that the user actually saw like if i'm now bidding after a social casino you know do i want to show another social casino or maybe it's a good time to to try something else um those type of of um parameters uh do not identify the user in any way but in global context and and we've been

running tests with like good programmatic partners like liftoff and moloco and i'm sorry i won't mention everyone but like good partners and and we can see how different parameters without idfa can help machine learning you know place the right bid it requires some more work again it's a process but but i think if that work we will all benefit from it this is great news to be honest because what you know from publishers like what we'll usually think of when we think of programmatic in 2020 like okay guys you're going to use probably device uh i don't know the publisher name the publisher app and maybe time of the day and of course location and that's what you're going to deal with but now hearing that you guys look into like a deeper variables and there are much more variables than we actually think of indeed that that gives us a bit more confidence so thank you for sharing one step at a time yeah again it comes down though to like offer said a while ago um update those sdks

right that's that's what he's talking about right now they're discovering these really cool ways to make us all more money and it's going to be in the new sdks as they come out so that's why we should all be pushing those so that they can learn faster because we all make more money when um they have the tools to learn i i'm really just interested to see what offer in that team comes out with in terms of the next topic i thought we could talk about just looking at all the stuff happening you know we've got a bunch of changes happening we've got idfa deprecation happening so in 2021 if we were to think about the impact to the ecosystem in terms of you know are there again is there going to be consolidation uh you know the various companies both at the studio level at ad networks you know mediation layer will there be more acquisitions could you guys just talk generally or a high level in terms of what do you guys think will happen at the ecosystem level in 2021 and again

maybe starting with you josh i'm just gonna punt this one straight to offer as um as a mediator i'm really curious to see what offer has to say so i was actually about to take it to a different level which is like the industry um i think 21 what is planned for us is just a lot more recognition for mobile games in general we've seen it with the unity ipo we've seen it with digital turbine who is just exploding in the market we have couple of future ipos coming up from you know ad networks around us we've seen it with gaming companies we've seen zynga stock a still fund group ubisoft right i mean it's amazing so um for me it all comes together the market is going there is more recognition more money more consolidation more attention for marketers and brands everything is playing you know into the

same into the same field and it's helping us all it's really helping us out because we need more people like josh to come up and you know build those great games and appeal to those audiences and people like sophia you know that can also push the industry via acquisitions and you know pushing more ua budgets into the market it's all coming together even though we had a epandemic and we still do and idfa may go away i'm bullish about next year i really am i feel like the the market forces are strong and positive and are working to help us all sophia did you have any thoughts yeah well toyed up on them on my mention about you know more consolidation so clearly bigger companies smaller companies uh i do believe well i think we're expecting a couple of ipos is your i think roblox should be ipod i guess and there is some other companies so i think ipo wise is going to be fun uh for sure i completely agree with

offer i think the year is going to be very interesting in all aspects so let's see um well um i do believe that there will be more acquisitions coming to a network to network or maybe network to uh mmp or so uh i feel like this is gonna happen uh but i have well i'm hoping that no more networks buying gaming studios will happen but i guess i'm pretty egoistic about it yeah i think that's gonna keep happening that's pretty that's pretty likely keep my hopes up josh come on i think that's okay so long as data is not shared but um i think data's gonna be shared i mean um obviously that makes it harder but i think that's just what it is when you look at what ad networks are doing i mean even mediation letters

um you know iron source their mediation platform they're asking you to do things like pass back who your spenders are they're asking you to run your your institutional frequency a b testing in their platform that gives them really powerful data even outside of acquisition there's a lot of um tendrils kind of pulling out there trying to grab at that data because it's just so valuable um one question kind of has to be is um for for publishers is who are you willing to share your data with how much are they asking for and what data do you have that's exclusive because perhaps you have to share some data with some people but perhaps you can maintain some exclusive data for yourself that no one's sharing i think that's potentially very um impactful for publishers going forward right

yeah i mean i do think just in general not just iron switch i think everyone's going to be asking for all of your data as much as i can get in 2021 right i mean that's so definitely going to be you know what i'm calling datawars of 2021 but maybe in terms of the next topic are there any trends that we missed uh you know we certainly talked a lot in terms of impact of idfa deprecation and other potential trends happening but in terms of ad monetization ad revenue in 2021 what have we not talked about so far that might be very important for you know studios or publishers to think about one thing that comes to mind is mediation itself we've touched on that a little bit is there any kind of useful insights there team it's you know again it's all it's all related but you know i think some some publishers are starting to ask themselves should we you know own mediation or parts of mediation

and own doesn't mean necessarily to build uh will there be new business models or new type of integrations where you can you as a publisher can take the mediation um building block engine just top your data or top your secret sauce on top of it something you can't really do with the off-the-shelf mediation um that's that's definitely one one trend we may see next year the other thing that is not necessarily mediation related is around android and you know the tension between the us and china made several device manufacturers like huawei and others kind of split android and come up with their own um platforms which i think opens up an opportunity for publishers who are willing to spend a little bit of time and and modify their their content to their store and in their platform that's another distribution channel that can be interesting in you know new markets

and new devices so i think we're seeing more of that in in different places around the globe and that's an opportunity for growth yeah that's interesting i also think that the to use your term the off-the-shelf mediators um the the big players already there they're almost transitioning away from being a pure mediator where they are passively just holding an auction and transitioning to almost being a growth partner where where their goal is to to grow to grow you which has been really interesting from my perspective the delta between mediation performance does appear to be growing um there are a few things that comes to mind that's kind of stuck out to me so we um wild card with our biggest game we tested a mediation switch to to max in november um and honestly i'm a little embarrassed by how impactful it was because i

i worked my ass off on those waterfalls um so switching to max got us as a d7rp increase of over 20 percent so that that was really impactful also what i've seen is mediators starting to offer more and more services there were a lot of issues i didn't realize could happen especially with in-app bidding as that starts to um take over from pure waterfall style bidding um i don't know if you've experienced this sofia we had one network just very recently showing crazy crazy revenue numbers in max but they have a tool that compares what they're bidding in programmatic bids versus what they're actually paying us and the delta was like 5 to 10x and part of their service was they actually emailed that ad network and said hey you're bidding this much and paying them this much

why and i didn't even realize that was a problem with um programmatic mediation those additional services to help extend your team and keep you small and light are becoming more and more important um and then i believe with ironsource and and applovin they both have auto roast ua products where if you integrate with their mediation they pass ad revenue directly back to the network and that allows you instead of buying on a cpi basis you can actually buy on a pure roast basis and that enables you to immediately scale your spend and that's an additional value add that they're bringing so again it's um they're kind of earning your data so to speak um but i'm a little guy i i need all the help i can get scaling um i'm curious to know you know sophia you have a much larger amount of data and a lot more to

lose so i'm kind of curious to know i'm hungry for growth what are your thoughts yeah that's uh that's a good challenge you're imposing here josh i think that uh well with um our current provider i unfortunately we do not see that much of a data when it comes to in-app bidding so everything that you've been uh telling us it's the opposite for us we do not see a very huge uplift coming from an upbeating but we'd rather see a lot of issues and by issues technical errors certain situations which we're trying to resolve right now so i cannot really even say uh you know hey all go to inaudible it's just working out great it works out on one of our games but now we're testing it back just to make sure that it actually works uh another problem we have that there is lack of transparency so while we were expecting to see you know bids versus traditional instance bids

and so on we do not have this data therefore as a publisher who indeed can afford let's say a less intense cash flow we we are thinking to um to work with the more transparent partners in general and this is for sure because we do not want to endure situations where we don't even know what the beads are for our bidding traffic coming from anybody you know um but having said said that uh in back to your questions joseph uh you asked like what do we think what happened with mediation i really really hope and i think it will happen that we will get a couple of or maybe even more uh players on the market in terms of mediation platforms those players i'm pretty sure the the biggest sales pitch for everybody who comes to this market will be hey i'm actually really transparent not like those guys but i am really transparent so uh which makes sense because transparency around now is is the best selling point like it's

something that everybody promises but we never have have it eventually uh so this is my prediction i think that we'll see some some new stars on the market and um it will be very interesting because in my opinion in our mediation platforms market we don't have enough players it's way too segmented the market shares are huge and this is wrong like i'm happy that fiber comes back you know you guys are coming back now pretty strong so this is great if we have two more players that are coming back strong we will see that we will see what we want to get we probably will see even some accurate data from some certain bidding partners uh hopefully but yeah i really enjoy watching the fair thank you at sophia i really enjoy watching the conversation between josh and sophia because like anything in life you can't build one product that fits so different audiences right and sometimes if you try to satisfy everyone you end up satisfied no one so you you have to choose of course with

the right resources you can do this and this and this but you know as a product person myself i know i know that focus and prioritization is very important so you guys have different needs so i'm not surprised to see that you also have different feedback it's not about right or wrong it's just you know completely different set of of expectations yeah i i i agree i would second though sophia on the need for transparency um i i would make a prediction that's slightly more caveat than hers where i'd say that we we need to know what the freaking bids are guys like that that's ridiculous um it's not good faith behavior to withhold um critical information we just talked about what those are for those are going to allow us to get through idfa apocalypse you know okay we need those for sure um if mediators don't offer that transparency then there will probably be um

fewer barriers for to entrance for new media to come to the market if they do offer transparency not sending back the bids for one network is it's a major issue which is why i mean it's a huge deal for us it was a just going through this negotiation process in the last month and a half integrating a new mediator that was a very very large issue for us um we the way we stated it was you know like i'm actually really proud of our product team we've grown our d30rpu for our biggest game by over a hundred percent this quarter that's huge and there is no mediation product that's gonna give me that so it doesn't matter if i'm gonna get 20 gain um one time if i lose my data i lose ability to grow so data and transparency trumps everything else um so that's why we ended up one of the

reasons we got going with max and i'm not i'm not paid to say that by max or anything i just like to share best practices we you know very grateful that there we've been able to boost our ad revenue while at the same time we are getting api-based ad revenue reporting inclusive of fan bidding estimates and everything else that is a clear transparency is a big value prop and i really hope to see more mediators follow through in that way i agree let's let's hope for 2021 and what happens there yeah 2021 definitely i i think it's going to be just as interesting as 2020 personally but uh on that note i think that's all the questions i have guys thank you very much for joining maybe we could just end with a final message for our audience and if people

want to get in touch with you maybe a way for them whether it's linkedin or twitter or what have you how they can get in touch with you again starting with you josh [Music] yeah i mean final message is be prepared be ready to rebalance and handle how you run admon we're gonna be we're gonna get hit by a big wave if you're ready you can surf the wave if you if you're not ready it's gonna pull you under so as long as you're ready you're gonna be okay um also wildcard is hiring right now we're growing quickly we're looking for art directors growth managers ua managers um smart people to help us grow our products uh if you're interested you can find me on linkedin i'm josh chandley um that's it for me okay offer yeah so it is it was great to have you all here thank you to be with you here it would be great uh one last message a 21 might start a bit rough in q1 but again remember it's a process

a you start low we can only go up from there so i'm very optimistic um we are having as well just like a josh especially product managers ua monetization pretty much everywhere in the world a remotely or one of our offices uh you can find me on on linkedin or my email offer.i at fiverr.com thank you sophia alright guys well it was an absolute pleasure thank you so much for the invitation i learned a lot from all of you guys and it's been i hope i hope our listeners uh did the same um to find me clearly on linkedin with my russian surname you probably will have some issues so just try sophia and social point and i think you'll find i'm the only sophia and social point so i'll i'll provide links for you guys but perfect that's even better get in touch all right great thanks again everyone and that's it

bye thank you [Music] me