Do you intend to develop a free mobile game app or do you already have one in the works? If so, have you given any thought to your monetization strategy? In other words, how do you plan to make money from your app?

Naturally, the answer is advertising. However, there are so many different ad monetization options out there that it can be difficult to know which one to pick. That said, you’re likely to find that rewarded video ads are the best choice if you develop games for mobile.

Why? Rewarded video advertising tends to be successful because it is a big hit with game developers and players alike. These engaging ads are appealing to players because they provide them with a reward of some kind (ex. virtual currency, extra level, etc.), giving them the incentive to watch the ad. On the flip side, the ad appeals to developers because the mobile gamers who participate by watching the advertisements bring them money.

Video ads that offer rewards are preferred by both gamers and developers

A recent study conducted by Unity Technologies found that among over 2,000 mobile games developers and players that they surveyed, both groups preferred rewarded video ads in mobile games compared to other forms of in-app mobile advertising.

Among the mobile game makers, 52% said video ads provide the highest revenue per users than any other form of in-game advertising and 9% of developers said that they noticed a drop in retention after introducing rewarded video advertisements. Meanwhile 86% stated that integrating these ads unaffected in-app purchasing or – in some cases – even increased it.

As for players, 71% said that they prefer to watch video ads to “pay” for game content while 54% purposely chose games with rewarded video. The vast majority of players who took the survey – a whopping 80% – said that they would be open to engaging with video ads if it meant receiving in-game rewards.

According to the senior manager of exchange marketing at Twitter/MoPub, Elain Szu, even advertisers like rewarded video ads because it gives them more “leeway and time to get their message across for their brand than a video you can skip after a few seconds,” Szu said.

Clearly, rewarded video advertising works for mobile games, but did you know that there are different video ads possibilities?  Finding success with this advertising tool isn’t just a matter of picking the right reward to offer, but also knowing where to place the ad in your app where it is most relevant and the least likely to frustrate the player.

With that in mind here are different ways that you can implement this advertising tool into a mobile game.

Where you integrate ads matters

Not every game is structured with natural break points, which can make it more of a challenge to know where to creatively insert the advertisement. Here are some suggestions:

• Before gameplay – if your game is split up into stages or levels, placing a reward video ad before the next stage offers players a chance to obtain a reward before they move on to the next level.  For instance, in the game “Flappy Bird” watching a video ad can give a player a power-up or boost, which could affect their performance in the next level.

• During gameplay – if your game is designed to make a player pause and think, such as a quiz or puzzle game, placing a video ad during gameplay if the player pauses for too long to provide them with a hint to help them solve the puzzle, could be very useful.

• After gameplay – placing the ad after a game is over also works for mobile games that have stages or levels because the reward offered can provide a player with the incentive to keep playing.

Think about what bonuses you will offer

The perk that you offer gamers needs to be something that they will find worthwhile and that is relevant to your specific game. Examples of common rewards include: game currency, extra lives, experience points, hints, a bonus item, restart from checkpoint, and so on.

The bottom line is that rewarded video ads work well for mobile games when they are effectively implemented. Players who are not interested in paying for games will most often jump at the chance to watch video advertisements in exchange for virtual goods. This keeps them happy because they get to play a game for free and can earn rewards at no cost, while the developer gets to generate more revenue from the watched ads.

For game developers, players and advertisers, rewarded video ads are a win-win-win solution.