imo boosts both ad and IAP revenue with rewarded ads on communication app

Founded in 2005, California-based instant communication app imo serves more than 200 million monthly active users across South Asia, the Middle East, and other emerging markets. Its highly localized, technology-driven product embodies the team’s values of interactivity, enjoyment, affordability, and inclusivity. imo’s mission is to enrich lives while working to become the world’s friendliest and most accessible online platform where people can connect and share.

With such a large user base spanning Android, iOS, and Windows, imo’s Head of Monetization, Efan Wang, knew that there were still untapped opportunities when it came to app monetization. When the team integrated AdMob’s rewarded ads, users could trial imo’s premium chat services, and, as a result, more users converted to premium. Not only did in-app purchase (IAP) revenue grow by 5% thanks to the higher number of conversions, but the new ad format also increased ad revenue, boosting imo’s earnings across revenue sources.

In 2020, Efan was on the lookout for opportunities to diversify revenue. Most of imo’s earnings came from ads, and the team wanted to grow its other sources for greater stability. imo’s app offered premium chat services, which included IAP, so the team started brainstorming ideas on how to expand this area. The two challenges were to find the best way to convert users to premium without damaging retention and to keep the cost-benefit — especially when it came to eCPM and fill rate — at the right balance.

The monetization and user growth teams were heavily focused on user retention, and they brought up several concerns with the user experience as the larger team explored options. After a deep dive into user research, the teams discovered that users really wanted to test out premium services and that the demand for free trials was too high to ignore.

imo was already familiar with Google products, having implemented AdMob back in 2014. Once the rewarded ads format became available, the team wondered whether it could offer a free trial of imo’s premium services through the reward to convert more users into premium, higher-value customers without harming the user experience. Rewarded ads, team members realized, held opportunities beyond gaming. After discussing ideas with its partners at AdMob, imo decided to move forward with rewarded ads.

With the user growth team’s concerns in mind, Efan and his team initially ran a small A/B test for rewarded ads. Because the Android app already had complete premium service functionality, the team randomly selected 5% of global Android users for the experiment group. After watching a video, a user in the experiment would receive a number of diamonds, which they could exchange for premium services such as rewarding a host in a group chat or an ad-free chat experience.

The test ran for two weeks. imo closely tracked the renewal rate for IAP, hoping more users would sign up for the premium experience after enjoying its benefits. The team also kept an eye on user retention on the basic communication functions of the app, such as how many people continued to make voice calls. Then, the team upped the percentage to 10% to monitor the long-term effects of the new ad format. End-to-end setup throughout the experiment went smoothly because it was “just like integrating banner or native ads,” says Efan. “Integrating rewarded ads is effortless.”

Not only did imo’s rewarded ads integration increase ad revenue, but it also grew IAP revenue by 5% through conversions to premium and showed no harm to retention or negative impact on user behavior.

At imo, the future is arriving quickly. The team is now working on building a greater sense of community through such new features as chat rooms and supporting the imo app through further experimentation with Google’s ad formats. The team has already set plans in motion to move beyond communication — evolving into a lifestyle platform for more than 300 million global users to participate in and enjoy.