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The $100B+ Blind Spot: Why DTC is Moving to Mobile Gaming
While most founders battle on the Meta feed, smart brands are joining the Winner's Circle by betting on mobile games ads
The Meta/Google duopoly is a crowded house, and it’s time to look elsewhere for acquisition.
You know the story: CPMs are rising, attribution is a game of "guess who," and the user experience on social media has devolved into a defensive, passive doomscroll.
Besides competing with millions of other brands, you’re also competing with the anxiety of the news cycle.
Meanwhile, a massive ocean of active attention is being ignored by 90% of DTC founders, who still haven’t considered advertising on mobile games.
This channel has gone from being just for kids playing in basements to the primary entertainment hub for the modern consumer, from the C-suite executive on a flight to the parent in the school pickup line.
One of the main differences with social is the state of mind of the consumer. In Meta/TikTok apps, users are scrolling to kill time. In gaming, they are invested, chasing a win.
When you position your brand inside that mindset, the odds stack in your favor.
In this edition, we’ll break down the shift away from social media monopolies, explore the psychological differences that favor mobile, and give you the tactical playbook to win in this channel.
Macro: The end of the social monopoly
Trends: The psychological context of flow state
Tactics: How to turn your ad into a "power-up"
Let's dive in 👇
🤝 The Scale-in-Public Series: Will You Accept the Challenge?
If 2025 taught us anything, it’s that being 100% dependent on Meta or Google is a structural risk.
As the duopoly's efficiency hits a ceiling, the most forward-looking operators are diversifying their acquisition mix into untapped channels like mobile gaming.
But shifting channels shouldn't happen in a vacuum. That’s why Chew On This is partnering with Axon by AppLovin to launch an exclusive podcast series.
We are selecting 4 high-impact DTC brands to onboard with Axon by AppLovin, and we’re sharing the entire journey on our podcast.
We aren't looking for tire-kickers. We want brands ready to take accountability for their next phase of growth. To make it happen, we’re putting skin in the game:
Each selected brand receives $30,000 in Axon credits to kickstart their mobile gaming strategy.
You’ll join us on the podcast to share the raw numbers, the creative hits and misses, and the real-world ROAS.
We want to show the industry exactly how to build a profitable, high-scale acquisition engine outside of the social media feed.
If you’re ready to kickstart your new phase of growth, we want to hear from you.
Macro Environment
📉 The End of the Social Monopoly
For the last decade, the DTC playbook was simple: arbitrage Meta until the creative fatigued, then move to TikTok. But in 2026, the walls are closing in.
Global advertising spend is forecast to grow 9.1% this year, surpassing $1.3 trillion for the first time on record.
The problem is that nearly 80% of that total spend goes into the same three buckets: retail media, search, and social. We’ve reached a point of structural saturation.
Meta and Google alone are expected to absorb the majority of global ad growth through 2030, which means we are reaching a point of diminishing returns where the cost to "rent" an audience on social media is outpacing the LTV of the customer.
While operators fight for the same 2 hours of daily social media time, a massive inventory vacuum has opened elsewhere.
Mobile gaming has matured into a $110 billion+ advertising powerhouse. It’s no longer a niche for gamers; it’s where 65% of the American population now spend their active mobile time.
The macro shift is clear: smart brands are moving away from the crowded scroll on socials and into active entertainment in gaming to escape the acquisition duopoly.
🧠 Takeaway: To maintain margins in 2026, operators must diversify into other advertising environments like mobile gaming, where inventory is massive, and the auction isn't yet at a breaking point.
Trends
📊 The Psychological Context of Flow State
One of the key elements why the best operators are choosing to diversify their acquisition mix with mobile gaming advertising is because of the type of attention you are buying.
On social platforms, the user is in a discovery mindset.
They are scrolling for the next hit of dopamine. And because the feed is infinite, you are fighting for a literal 1.5-second thumb-stop.
In contrast, mobile gamers are often in a flow state - a period of deep focus, enjoyment, and goal-oriented concentration - which changes the fundamental value exchange of an ad:
Rewarded video (watching an ad for a game benefit) is now preferred by a large majority of players compared to other formats.
This means users aren't just tolerating the ad; they are opting into it to achieve a goal within their gaming environment.
Completion is the standard. Because the ad is tied to tangible progress, completion rates for mobile game video ads consistently exceed 90%.
In a world of skippable 5-second social clips, this is a massive advantage for brand recall.
The undivided screen: Unlike social media, which is often consumed while multitasking (e.g., watching TV), gaming requires 100% focus to succeed.
The single-screen engagement means your creative is the only thing the user is processing for 15-30 seconds.
For DTC, this means your ads have a longer runway. You aren't just a blip in a feed; you are a full-screen experience that the user has purposefully chosen to engage with to help them get back to their game.
🧠 Takeaway: By leveraging the value exchange of rewarded ads, brands can achieve completion rates and recall that are becoming statistically impossible in the fast-moving social feed.
Tactics
⚙️ How to Turn Your Ad Into a "Power-Up"
To have a successful advertising strategy in mobile games, you don’t have to reinvent your brand. You just have to translate your message into a language that resonates.
Here are 5 tips to give you a head start in a winning mobile game ad execution.
1. Make Your CTA a Dopamine Kick
Don't just ask for a click, offer a trade. Align your product benefit with the game's reward. If they watch your ad for a "life," your CTA should mirror that energy.
Example: "Need a boost? Use code RECOVER20 for 20% off your next hydration tub - fuel for your real-life win while you wait for your next life."
2. Take Advantage of UGC
Stop over-producing. 2026 data shows that Lo-Fi UGC - native, 9:16 vertical video that looks like a TikTok - actually converts better in mobile games.
It feels human and authentic in a digital game environment, breaking through the polished ad blindness.
3. The 5-Second Hook Rule
Most mobile game ads are unskippable for the first 5 seconds. You have exactly 120 frames to establish your hook. Don't lead with a logo. Lead with the problem your product solves.
If the viewer doesn't know what you're selling by second 5, they’re already looking for the "X" button.
4. Frequency Capping Strategy
In gaming, ad blindness happens faster because the user is seeing ads in high-repetition loops. Successful brands rotate 3-5 creative hooks weekly rather than monthly.
5. Leverage Playable Elements
You don't need to be a game dev to use interactive ads. Using a simple "Swipe to Reveal" or a "Choose Your Bundle" mini-interaction can hold a user’s attention longer than a standard video.
🧠 Takeaway: If your ad provides a brief moment of entertainment or a clear reward, the user stops seeing you as an interruption and starts seeing you as part of the game’s "power-up" ecosystem.
🔗 Quick Hits
Starting February 25, 2026, TikTok will officially discontinue seller shipping. U.S. merchants must transition to TikTok Shop Logistics Services (FBT) or approved ERP integrations by March 31 or risk losing access to the platform’s 170M+ users.
Amazon reports that customers who interact with its AI shopping assistant, Rufus, are 60% more likely to purchase that session. Conversational search now accounts for nearly 20% of all Amazon queries in high-differentiation categories like supplements and beauty.
Meta’s roadmap for the first half of 2026 focuses on fully automated advertising, where operators provide only a product URL and budget, leaving AI to handle creative generation, audience targeting, and real-time bid optimization.
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