Eighty-nine percent of the top-grossing mobile app and game publishers use some form of video ads, according to an annual publisher survey by mobile marketing firm AdColony.

The AdColony Mobile Publishing Survey said that publishers rely on video ads and in-app purchases to monetize their mobile games.

The mobile publishers included gaming and non-gaming app developers and averaged at least 3 million monthly active users (MAU).

With so many methods available to earn revenue, a high majority of respondents (89%) said they used various types of video ads in their games. A significant number of publishers (68%) also rely on in-app purchases to monetize, while 35% said they used display ads.

The recent launches of game subscription services like Google Play Pass and Apple Arcade made little impact on respondents' monetization efforts: Only 2% stated that they used subscriptions for revenue.

Video ads draw the most excitement for publishers

Publishers were asked which monetization methods were they most excited for. Video ads drew the most excitement by far, with 51% of respondents choosing those methods. When asked about specific methods, the top three were interstitial video, interstitial display, and playable ads.

Rewarded video ads are considered the most effective

Publishers gave the highest average ratings to rewarded video ads (4.6) and interstitial video ads (3.7). Interstitial display ads barely beat out in-app purchases with ratings of 3.5 and 3.4, respectively, despite more publishers saying they use in-app purchases (+33%) over display ads.

By contrast, pre-roll video ads and native ads are the worst when it comes to effectiveness at 2.3.

Ads account for 63% of total publisher revenue

Above: The breakdown on monetization of games versus other apps.

Image Credit: AdColony

The real test of monetization effectiveness is the revenue it brings in, AdColony said. The Mobile Publishing Survey asked respondents to estimate the breakdown of their revenue and ads (video, display, native) accounted for 63% of total revenue.

Since the previous version of the survey, this total has gone up by 8 percentage points. The top revenue sources are video ads (35%), display ads (21%), and in-app purchases (18%). In 2017, publishers claimed that in-app purchases accounted for 39% of revenue, which means a 21-point drop since that edition of the survey.

When looking at gaming versus non-gaming apps, both types still receive a majority of their revenue from advertising. Ad monetization provided 63% of revenue for mobile games, while publishers of non-gaming apps reported that ad integrations supply 66% of their total revenue. Revenue from display ads makes up 29% of total revenue, 13% more than gaming apps. Gaming apps also receive more of their earnings from in-app purchases and ecmmerce (+13%) than non-gaming apps.