In 2015, Michael Witz and Dan Lin co-founded Redemption Games hoping to create games that millions of people would love. The California-based company prioritizes craftsmanship, and believes that going the extra mile to perfect every detail makes a huge difference. Redemption also values a genuine love for gaming, and seeks team members who are enthusiastic about every aspect of games: from playing to creating.
Redemption has been in gaming for five years, but launched their first mobile game, Sweet Escapes, in 2019. The team originally worked with one ad network provider, but found that their inventory space was not being adequately filled, resulting in lost revenue. To solve this, they integrated AdMob mediation coupled with smart segmentation for rewarded ads into their game. With AdMob, Redemption increased their average revenue per user (ARPU) by 43%, their cost-per-thousand impressions (CPM) by 40%, and doubled their overall app revenue.
Low fill rates and low revenue
As a gaming industry veteran, Michael is familiar with the challenges of game production as well as the obstacles that can kill a game. He considers the Redemption team to be students of the free-to-play genre, and is “ interested in finding innovative ways to strike the right balance between a game that catches people’s attention and has a good financial model.” This is a driving force for Redemption, and the team is careful to maintain this balance when adding new features to their games — from SDKs to new ad formats.
With the launch of their first mobile game, the team needed to monetize — but worried about complicated SDKs and hurting their in-app purchase (IAP) revenue. To simplify the launch, Redemption initially worked with only one ad network provider. “This didn’t give us the inventory fill that we needed, which meant our users were not benefitting as much as they could have from our ads.” says Michael. With one ad network, Redemption also had lower CPM rates than they would if they worked with other mediation partners, resulting in lower potential revenue.
Mediation with smart segmentation is the winning combo
To manage their growing number of ad networks, Redemption partnered with a third-party mediation platform. Unfortunately, Redemption ran into multiple complications such as lengthy SDK integrations and technology issues that made them rethink their partner. “The question was: how do we provide ads in a way that protects our economy without hurting us? To us the answer was in AdMob’s mediation alongside smart segmentation.” said Michael. With smart segmentation, Redemption would be able to split users into two segments — predicted purchasers and predicted non-purchasers. This allowed them to monetize predicted non-purchasers, while preserving a premium, ad-free experience for users already spending money within their app.
As a first step, Redemption integrated AdMob mediation straight away. They skipped the testing phase since they had used Google products successfully in other parts of their business.
Next, Redemption A/B tested mediation alone against mediation with smart segmentation. They used an internal tool to randomly assign some users to mediation with smart segmentation, and some to mediation alone. Redemption did not change their ad placements or design. They ran this test across all Android and iOS devices, and tested 80% of their user base while keeping 20% as a control group. Redemption tracked user conversion, retention, overall revenue, and average revenue per user for 30 days.
With smart segmentation enabled, Redemption was able to personalize the ad experience and show ads only to users who were predicted non-purchasers. This let them keep the original, uninterrupted app experience intact for users who were predicted purchasers. “Implementing mediation was really straight forward and we had no complications. The time it took us to work in smart segmentation was really trivial as well — pretty much no added time.” said Michael.
Steady IAPs and revenue increase
After implementing mediation with smart segmentation, Redemption saw a 40% increase in their CPMs and grew ARPU by 43%. Redemption also saw no negative impact to their user retention or user conversion, meaning that their IAP revenue stayed intact. “Smart segmentation became meaningful for us because it protected our customer conversion rates and was an additive to our revenue. We weren’t forced to choose between IAP or ad revenue.” said Michael. With an increase in ARPU and a steady expansion of their audience, Redemption doubled their app revenue over the course of their 30-day test.
Redemption was surprised to learn how much ad revenue was available outside of the United States. “There are many countries that have healthy CPMs and can be meaningful contributors, so the global coverage we got with AdMob was a great surprise,” said Michael. Thanks to AdMob’s technology, Redemption is also exploring new integration points within their game and actively searching for new features to add.
“Google has built a strong culture around wanting developers to win, so we’re really happy to be fully aligned on our technology stack.” said Michael. In the next five years, Michael plans to build the team further and start thinking about more projects that will further establish Redemption in the gaming industry.
