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Rewarded Video Ads: Everything You Need To Know

Video ads are a form of digital advertising that uses video content to promote a product, service or brand. These ads are displayed on various online platforms including social media, websites and streaming services. Engagement, storytelling, Visual Appeal are the certain benefits of rewarded video ads. Did you know! Rewarded Ads? Rewarded video ads are a dynamic and versatile form of advertising, offering diverse opportunities for businesses to connect with their audience in a visually compelling way. Successful video ads often combine creativity, strategic targeting and clear understanding of the target audience. 

What are Rewarded Video Ads? – Explained

Rewarded video ads are in app advertising format where users voluntarily choose to watch a short commercial in exchange for a reward or incentive within a mobile application or game. Rewarded video ads bring out voluntary engagement, use of friendly approach, incentive and reward, integration in app and games, enhanced user retention and come up with monetization strategies. 

What are Rewarded Video Ads

Magicbid comes as a boon in terms of rewarded video Ads where you can watch a video ad and get yourself back in the process. 

Rewarded Video Ads Revenue and eCPM Rates

Rewarded video ads are a type of mobile advertising format where users choose to watch a video advertisement in exchange for some reward within the app or game they are using. These rewards can include in app coins, extra lives, power ups or virtual goods. The key aspect is that users opt to view the ads voluntarily in exchange for a benefit. 

Revenue and eCPM Rates

eCPM stands for effective cost per mile or ‘Effective cost per thousand impressions’. It is a metric used in the advertising industry to measure the estimated earning for a publisher per 1000 impressions of an ad. Ecpm is calculated by dividing total earnings by the number of impressions and then multiplying it by 1000.

For rewarded video ads, the Ecpm rate would indicate how much revenue a publisher can generate for every 1000 impressions of a rewarded video ad. The ECPM rate can vary based on factors such as type of app, the target audience, geographic location and the specified ad network or platform being used. Generally, rewarded video ads tend to have a higher ECPM rate compared to  other ad formats because users actively choose to engage with them. 

It’s important to know that ECPM rates are just one metric and publishers often consider the factors such as fill rate, user experience and overall User experience when evaluating the effectiveness of ad monetisation strategies. 

What are the Benefits of Rewarded Video Ads?

What are the Benefits of Rewarded Video Ads

1. Higher User Engagement: users opt to  watch rewarded video ads willingly in exchange for in-app rewards. This voluntary engagement leads to higher user attention and interaction. 

2. Increased Revenue: rewarded ads generally have a higher ECPM rate as compared to other formats. The advertisers are willingly paying more for ads that users actively choose to watch leading to increased revenue for app developers. 

3. Improved User Retention: offering in-app rewards for watching ads can enhance user retention. Users are more likely to continue using an app that provides them with benefits for their time spent. 

4. Monetization without Intrusion: Rewarded video ads provide a non intrusive monetization strategy. Since users willingly choose to engage with the apps it creates a positive experience without stopping the functionality of the app. 

5. Targeted Advertising: advertisers can tailor rewarded video ads based on user preference and behaviour, leading to more relevant and target advertising just can enhance the overall User experience and increase the likelihood of ad engagement. 

Best Practices for Rewarded Video Ads

Implementing rewarded video ads can be an effective strategy for monetizing your App while providing value to users. So let’s state out some practices that you can follow for the same. 


  • User friendly Integration: integrated provided videos ads seamlessly into the user experiences. Make sure they appear at natural brakes or points of engagement in your app. 
  • Opt In Approach: make the use of rewarded videos optional. Allow users to choose whether or not to watch an ad in exchange for a reward. 
  • Reward Value: ensure that the rewards offered are attractive and meaningful to users. This encourages more users to engage with the ads willingly. 
  • Frequency and timing: you should be mindful of the frequency of rewarded video ads. Bombing ads on users can lead to frustration and negative User experience. 
  • Ad Mediation: use ad mediation platform to maximise fill rates and revenue. These platforms can help you dynamically choose the best performing ad network for each user request. 
  • Testing and Optimisation: Regularly test different ad creatives, what structure and placements to identify what works best for your audience. 

By following these best practices you can try a balance between monetization and User experience creating a positive environment for both users and advertisers in your app. 

Rewarded video ads – Challenges

Best Rewarded video ads while effective and engaging users and providing incentives come with their own set of challenges and here are some challenges that are associated with rewarded video ads. 

Rewarded Video Ads

1. User Experience Concerns: balancing the delivery of ads without interrupting the User experience can be challenging. if the ads are two intrusive users may become annoyed and disengage from the app

2. Ad Relevance: ensuring that the rewarded video ads are relevant to users interest and preference is crucial. Poorly targeted ad may not resonate with users leading to lower engagement and conversion rate. 

3. Reward Management: Determining the right balance for reward is essential. If the rewards are two generous it may impact the app’s monetization strategy. 

4. Integration Challenges: implementing and integrating rewarded video ads seamlessly into the apps can pose technical challenges ensuring compatibility with different platforms and devices is crucial for a smooth User experience. 

5. Measurement and Analytics: Measuring the effectiveness of rewarded video ads and attributing their impact on user engagement or conversion can be Complex accurate analytics tools that are necessary to assess the true value of these ads in the overall marketing strategy. 

Addressing these challenges requires an easy approach that considers both the User experience and business of the app. Developers and advertisers must continuously monitor and adapt strategies to ensure the effectiveness and sustainability of rewarded video ad campaigns. 

Rewarded Video Ads vs. Interstitial

Rewarded ads and interstitial ads are two different types of mobile advertising format each serving a distinct purpose in engaging users. They serve different purposes in terms of user interaction, engagement and incentive offered. Let us look at some key differences. 

Rewarded Video Ads vs. Interstitial Ads

  • Rewarded Video Ads: users choose to watch rewarded with your ads voluntarily. They typically offered incentives such as in app currency, extra lives or other rewards in exchange for viewing the ad. 
  • Interstitial Ads: interstitial ads are full screen ads that appear at natural transition points within the app, such as between levels or during pauses in users interaction. 
  • Rewarded Video Ads: the primary feature of rewarded video ads is the exchange of value. Users are awarded for their time and attention within a benefit enhancing their overall experience. 
  • Interstitial Ads: interstitial ads typically do not offer direct incentive to users; instead they aim to capture the user’s attention with the ad content itself promoting product services or other placement features without providing immediate rewards. 

Both rewarded video ads and interstitial ads serve as effective monetization strategies, they differ in terms of user interaction, in Centre placement within the app. Rewarded video ads emphasise user choice and value exchange where interstitial ads aim to capture attention during natural break in the User experience. 


Rewarded video ads create a win-win scenario by providing users with incentives, increasing revenue for developers, and offering advertisers a platform where users are actively engaged with their content. 

By using ad format switching in magicbid where if your ecpm is less than your interstitial ad then the rewarded ad formatting takeovers so that publisher may retain a good revenue. Hence magicbid runs 20+ ad networks and 80+ advertisers demand sources to generate a good revenue and rewarded Ads are one among them.