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Elevate Magazine
May 2, 2024

Discord Embraces Ads To Boost Revenue

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After a long history of dismissing the use of paid advertisements and promotions, instant messaging software Discord begins in-app advertising. The platform is reportedly making this change as part of its plan to enhance gaming-related and Nitro subscription revenue. 

Discord advertisements appear in the form of “Sponsored Quests”, Discord Senior Vice President Peter Sellis stated in a blog published in March. This offers active users in-platform or in-game rewards upon performing various challenges while others watch. Once the challenge is complete, viewers can also jump into the game and accomplish the “quests” to earn rewards. 

Discord said targeting ads will be based on a user’s gameplay, geographic location, and age. Users are also allowed to turn off this personalisation in the application’s settings. 

The Sponsored Quests model works in a similar way as last year’s May the 4th Discord promotion, where Fortnite players who streamed their game with at least one voice user won Star Wars-themed weapon skins. 

In an interview with Bloomberg, Discord CEO James Citron expressed the hope that “every game will offer quests on Discord.” He also revealed that Discord is likely to pursue an initial public offering (IPO) in the future and become a publicly traded company. 

Key Lessons from Discord’s Advertising Evolution

Flexibility and Adaptability

Digital companies must be agile and willing to adapt their revenue strategies based on market trends and user behaviour. Discord’s decision to pivot towards ads demonstrates the importance of being flexible and open to exploring new revenue opportunities.

Diversify Your Revenue Streams 

While Discord is primarily free to use, it generates revenue from various sources, such as premium subscriptions, game sales and membership fees, and server boosting. Discord’s multiple revenue streams, including Sponsored Quests as an additional source, provide a more stable foundation for the business and strengthen its growth potential.

Pay Attention to Your Target Audience

Discord’s core user base consists of gamers, and through its Sponsored Quests model, Discord ensures that the ads served within the platform align with its consumers’ interests and preferences. This targeted approach benefits both advertisers and users. Advertisers can effectively reach their desired audience, leading to higher conversion rates and return on investment. Meanwhile, users are presented with ads that are relevant to their interests, enhancing their overall experience on the platform.

As Discord continues to embrace ads, it sets an example for other digital companies to consider the broader impacts of ad integration, emphasising user experience and platform sustainability alongside revenue growth.