The evolution of rewards: From marketing model to loyalty driver

Earlier this year, I joined fellow Unity experts to forecast mobile gaming trends for 2025. One of my predictions was the continued growth of the rewards ecosystem – not at the explosive pace of previous years, but through more steady and strategic expansion.What’s fascinating about this evolution is how rewards now fuel every stage of the marketing funnel and user experience. As mobile and digital platforms evolve, rewards are becoming increasingly essential across games, apps, and web-based platforms. In this blog, I’ll explore key factors driving this growth, break down the core characteristics of the rewards space, and hopefully debunk a few myths.Why rewards are thriving nowRewards as incentives are deeply ingrained in human nature and have long been a cornerstone of games and gamification. While reward mechanisms aren’t new, several recent trends have propelled the rewards space into exponential growth:Users want moreOver time, user behavior has shifted significantly, especially with the rise (and decline) of the Play-to-Earn Web3 era. Today’s users want more than just entertainment. They’re looking for tangible value from their investment, like virtual currencies, cashback, coupons, or real monetary rewards. While Web3 Play-to-Earn is no longer the prevailing trend, users' behaviors and desires remain unchanged.Macroeconomic shiftsPost-COVID economic uncertainty led to cautious spending habits. Users are more selective with their entertainment, while advertisers face tighter budgets - making rewards an appealing option for both.Privacy challenges in user acquisitionAs the regulatory focus on privacy grows, acquiring high-quality users has become harder. Rewards offer a way to diversify UA channels, boost engagement, and deepen user relationships.Today’s rewards have evolved beyond traditional live ops campaigns and rewarded video ads. More games and apps now use offerwalls to boost their economies and monetization. Offerwalls attract highly engaged users who generate greater long-term value.Where does loyalty come into play?The rewards market is growing quickly, and the recent rise of the rewards app trend has been driving more attention to it with an expansion from in-app rewards to standalone rewards apps, resulting in a large number of rewards apps entering the market. But not all rewards apps or programs succeed. The key to long-term success lies in balancing user retention, engagement, performance of advertisers, and monetization.Are loyalty programs and rewards apps the same? Not quite – they each have a different focus. Loyalty programs prioritize building long-term relationships with customers, and usually have more features like levels, badges, special offers, and community features to help people feel connected to the brand. Rewards apps, on the other hand, have a more transactional focus in which they encourage repeat purchases, frequently with a spend-and-earn approach.When developing a loyalty program, ask yourself: Who am I building this for? Whether you’re a publisher, advertiser, or user acquisition channel owner, aligning interests is essential. Misalignment often leads to low engagement and lower ROAS in deeper cohorts.From a publisher’s perspective, loyalty can be a key driver of your in-app economy. Standard elements like live ops campaigns are great, but introducing an offerwall can take things to the next level. The best part? Offerwalls allow advertisers to subsidize user rewards, reducing the cost burden on you.How to make rewards work for youWhether you’re new to rewards or already implementing them, here are some tips for maximizing their impact:1. Refine your user journey to drive in-game progressionDesign rewards to enhance your users’ progression within your app or game. Choose the right flow, optimize bids, and ensure the rewards users receive align with what they should be earning.2. Leverage data to focus on the right cohortsPay close attention to the depth of cohorts you’re aiming to reach and select the best channel or vendor for support. Strategically tailor your approach for short or long-term cohorts with data-driven decisions.3. Prioritize UX in monetizationWhen monetizing through rewards, ensure offers align with your app’s core mechanics. Consider the optimal revenue model, offer types, and overall value proposition for both you and your users.The rewards ecosystem plays a pivotal role in increasing engagement, retention, and monetization. By understanding the factors driving this growth and aligning your rewards strategy with user expectations, you can unlock the full potential of rewards for your app or game. Whether you’re building a loyalty program or exploring offerwalls, the key is to create value for all stakeholders while delivering a seamless and engaging user experience.