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One of this year’s most interesting industry trends has been in the user acquisition space. No, not privacy changes to the app stores, but the rise of rewarded play platforms.
The space includes companies such as Almedia, Gamelight and Mistplay, to name just a few.
Generally, these UA channels give players tasks to complete in a game in return for rewards, like the platform’s own ‘currency’, which can then be cashed out for money and vouchers, depending on the service provider. The bigger the task – such as progressing through a set number of levels – the greater the prize.
Two and a Half Gamers’ Matej Lancaric recently delved into the rise of rewarded play here.
Shifting from B2C to B2B
One of the players in this space is Almedia, which refers to itself as a gamified promotion platform that aims to provide benefits to both advertisers and consumers. It does this via its Freecash platform, through which all ads run. Its services recently ranked fifth for absolute ad spend growth in Singular’s Q3 2024 quarterly trends report, behind TikTok, Snapchat, Blisspoint and Google.
The company was set up by Moritz Holländer, aged 17 at the time, in 2020 during the early days of the Covid-19 pandemic and lockdown. Initially starting without funding, Holländer took a $30k loan from his dad to grow the start-up, before then obtaining a credit line to scale the firm.
The platform started out as a way to obtain items and skins in games like Counter-Strike and Fortnite. Later, it rebranded to Freecash and offered rewards for a number of games. But one of the big “game changers” for Almedia came in 2023.
“Last year we made the realisation that to grow this product, to grow this business further, we need to put our focus not anymore on the users who actually come to our website like we did before – before we focused on improving the user experience a lot and so on,” says Holländer.
“But now what changed last year was that we put our focus actually on the B2B customers.”
Last year, Almedia employed around 20 staff. In 2024, it now has over 80 staff, with plans to double that headcount. Despite starting in the Covid-19 remote working era, the company has now set up a HQ in Berlin where a number of its key staff are based.
Heated market
With such fierce competition in the user acquisition space, that includes tech giants like Apple, Google, Facebook and TikTok, as well as leading networks like Applovin and Unity Ads, amongst others, why is rewarded play a space where Almedia sees an opportunity?
“Rewarded user acquisition has existed for 15 years, but it changed in the way it works.”
Moritz Holländer
“We realised that there’s a gap in the market,” explains Holländer.
“Advertisers have realised that rewarded user acquisition works, and they are willing to spend a lot of money when the performance is there. So the demand is pretty high. I think in general, gaming apps have to deal with rising CPIs no matter where they buy users.
“And it’s not easy for them to, for example, scale to an unlimited pace on Google and Facebook anymore due to that competition.
“So I think they were pretty happy when they saw that there’s a completely new vertical that’s suddenly opened up. Rewarded user acquisition has existed for 15 years, but it changed in the way it works.”
Game discovery
Holländer says Almedia – in a statement that all ad companies would make – aims to offer publishers access to users most likely to engage and spend with their games.
It does this by running campaigns itself, bringing in users to its platforms through networks like Google and Facebook. Then by understanding the preferences of its users – such as whether they are willing to watch ads and what genres they enjoy – it can set rewards appropriately to maximise revenue.
As well as looking to provide relevant users to publishers and advertisers, Holländer says Almedia wants to ultimately offer a discovery platform for players, without them needing to browse through the app store.
“If we know that you spent money in a certain genre, for example, and now there’s a completely different genre, like an action game, that puts a $20 CPI on you, we would probably still not send you into that game because we know that your expected value that you would generate for this type isn’t so high and we would disappoint the advertiser,” says Holländer.
“In the end we have the same incentives as advertisers. And that’s why we try to match users as well as we can.”