Hey — It’s Nico.

This is Behind Tactics 🧠, the Failory newsletter where I share the strategies behind the best startups.

In this issue:

• Why Voodoo and other mobile game publishers create fake ads.

• How this strategy is essential to validate ideas in the hyper-casual gaming industry.

• How you can utilize a similar strategy to validate your product and feature ideas.

• How this relates to creating “fake door MVPs” and pre-selling.

Let’s get into it.

Take a demo, get a Blackstone Griddle

• Automate expense reports so you can focus on strategy

• Uncapped virtual corporate cards

• Access scalable credit lines from $500 to $15M

Request a demo

The Strategy

The Rise of Fake Ads

We have all seen a fake mobile game ad before. You know the type—an ad that promises a certain gameplay experience, but it turns out to be completely different when you download the game. They are everywhere.

I am not particularly interested in mobile gaming, but these ads have always piqued my curiosity. Every time I see one, I ask myself the same question: Why are some of the biggest mobile game developers investing in ads that have nothing to do with the game they are making?

At first glance, it seems like a waste of money, especially considering how much gamers dislike these fake ads.

However, it turns out these deceptive ads are far from random. They’re a core strategy in the hyper-casual gaming industry, and while we may find them annoying, they are surprisingly effective in ways that aren’t immediately obvious.

Voodoo and Hyper-Casual Games

Hyper-casual games are simple, addictive games that are easy to play and often free to download. Think of those games you can play while waiting in line or during a quick break.

The business model behind these games isn’t about long-term player engagement; instead, it’s about volume—churning out as many games as possible, getting users to download them, and monetizing them through ads. 

In this world, Cost Per Install (CPI) is king. Publishers like Voodoo, one of the biggest players in the industry, thrive by keeping the CPI low, usually under 20 cents, to make their games profitable.

But here’s the twist—before even developing a game, companies like Voodoo need to know if it’s worth the investment. This is where click-through rate (CTR) tests with fake ads come into play. These tests are an ingenious method to gauge user interest before a single line of code is written.

CTR Tests and Fake Ads

So, what exactly are CTR tests, and why are they so important? Simply put, a CTR test measures how many people click on an ad compared to how many people see it.

For hyper-casual game developers, this metric is crucial. They create short, catchy video ads—often depicting gameplay that doesn’t actually exist—and run them on platforms like Facebook. If the ad generates a high CTR, the developers know they have a concept worth pursuing. If not, they abandon the idea and move on to the next one.

Voodoo routinely create these fake ads to test various game concepts. The goal is to see what catches users’ attention. It’s a quick and cost-effective way to validate ideas.

Other companies like Clap Clap Games follow a similar process, creating multiple videos, running them as link-click campaigns, and only moving forward with game development if the CTR is promising.

The beauty of this approach lies in its efficiency; it allows developers to test numerous ideas with minimal effort and resources. 

In addition to this, these ads can also be an excellent way to obtain new users. Despite the potential backlash from users who feel tricked, these fake ads are surprisingly effective. While many users might uninstall the game once they realize it’s not what they expected, a good portion will still stick around if it is enjoyable enough. 

This balancing act between user acquisition and retention is what makes or breaks a game in the hyper-casual space.

Beyond Gaming

While this strategy is commonplace in the mobile gaming industry, there’s no reason why it can’t be applied elsewhere.

Imagine a startup looking to validate a new feature or product idea. Instead of building a full MVP, they could create a video or mockup of the feature and run a similar CTR test. The idea is to gauge interest before committing significant resources.

A great example of this approach comes from Dropbox. Before developing their entire product, they released a video explaining what Dropbox would eventually become.

While this video wasn’t as deceptive as a fake mobile game ad, the underlying idea is the same: create a video for a product that doesn’t exist yet to test its appeal.

A related strategy, often used in the startup world, is the Fake Door MVP. A Fake Door MVP is a landing page for a product that hasn’t been built yet. The page typically explains the product’s features and includes a sign-up button for users to be notified when the product launches. The goal is similar to that of fake ads—to estimate interest in an idea and determine whether it’s worth the investment.

Should I?

Why This Works

• Low-Cost Validation: The strategy allows businesses to validate ideas or concepts with minimal upfront investment. By testing market interest before fully committing to development, companies can avoid costly mistakes and focus resources on ideas with proven potential.

• Data-Driven Decision Making: The strategy relies on measurable data (e.g., CTR, sign-ups, pre-sales) to guide decisions, making the process more objective and less reliant on gut feelings. This data-driven approach increases the likelihood of success.

• Flexibility in Iteration: Since the strategy involves testing before development, it offers the flexibility to iterate on ideas quickly. If one concept doesn’t work, it’s easy to move on to another without significant losses. Voodoo usually runs several fake ad campaigns at once, showing a different game concept in each ad. This allows them to quickly test and validate many different ideas and know which one to choose.

How to Apply It

• Create a simple mockup or video of your product or new feature. These don’t have to be polished; the goal is to convey the core concept and test whether it resonates with your audience.

• Run CTR tests on social media. Voodoo and other gaming companies use Meta almost exclusively for this. 

• Analyze the data and iterate. Monitor the click-through rate to see if there is interest. Running multiple campaigns simultaneously is helpful as it allows you to compare the CTR between different ideas.

• Create a “Fake Door” landing page for your new product. If you are running fake ads, you can link them back to this fake door. Include CTAs on the page to measure how many people sign up.

• You can take it a step further by attempting to pre-sell your product. This is the ultimate validation that your idea has strong potential.

Yes, But

• Potential Backlash: Users may feel deceived by fake ads, especially if they realize the advertised product doesn’t exist yet or differs significantly from the final version. This could lead to negative feedback, poor reviews, and a loss of trust in your brand. That being said, every gamer hates fake mobile game ads, but this hasn’t diminished their efficiency.

• Limited Long-Term Insights: While CTR tests and fake door pages can gauge initial interest, they don’t provide a full picture of long-term engagement or retention. A high click-through rate doesn’t necessarily translate into a sustainable user base or repeat customers.

• Risk of False Positives: A high CTR might suggest strong interest, but it could be misleading if users are drawn in by the novelty rather than genuine intent to engage with your product. This could lead to investing in a concept that ultimately fails to gain traction.

Keep Learning

Others Playing It

Almost all of the big players in the mobile game industry are using this strategy.

Some big publishers that usually run fake ads include Ketchapp, Lion Studios and Green Panda Games.

Go Deeper

• This article breaks down different early testing strategies for hyper-casual games.

• This article analyzes the Voodoo approach to making hit games.

• This video explores how mobile game companies are making billions with fake ads.

Refer Failory, Get Rewards

Share Failory

Chances are you have some more friends who would enjoy Failory as much as you do. Share Failory with these friends and cash in on premium resources and swag.

You currently have 0 referrals, only 1 away from receiving my Pitch Deck Airtable.

_{Or copy and paste this link to others: https://newsletter.failory.com/subscribe?ref=PLACEHOLDER}

Help Me Improve Failory

That’s all for this edition.

Cheers,

Nico