Marketers are always looking for new opportunities to tap into pop culture and gain access to significant audience volumes. Digital advertising is set to cross a major milestone in the world of advertising as it is expected this year to overtake spending on traditional ads. Yet, gaming remains the biggest untapped market, with a potential audience of 2.4 billion gamers around the world.
The last couple of years has seen an unprecedented rise in the market size of video gaming and esports. Consider this: the video gaming industry generated $43 billion in revenue in 2018, and this figure is expected to increase to $148 billion this year. The monthly size of competitive esports gamers is expected to touch 276 million by 2022. While gaming and eSports are making money, advertising budgets have remained a small proportion because of intrusive ads and lack of scalable tech solutions. Game developers, too, face the dilemma of opening their games to monetization without disrupting the gameplay. Advertising in games doesn’t necessarily have to be intrusive or ugly. Unfortunately, there continues to be little understanding of the in-game advertising space. When done right, in-game advertising has many benefits for all sides involved: advertisers, game developers, and gamers.
In this post, let us look at some of the most common myths around in-game advertising.
Myth 1: Gaming is Not Profitable for a Brand’s Audience
The traditional image of gamers bent over their gaming remotes in a living room may have contributed to this myth. For years, brands have not considered the core gaming audience to be their target customers. But let us tell you that is changing! Today’s gamers are sophisticated users who hold much more purchasing power than before. Gen Z, which is the highest user group among all gaming audience, is the biggest buying group with their buying power estimated at $44 billion. This has changed the perception of brands and also led to increased investment in video gaming and esports.
Brands have had a shift in their mindset and want to reach out to this new audience group that has remained elusive till now. They also recognize that to connect with this audience of the future, old advertising methods will not do. Today’s gamers are young users who look for more interactivity and expect authenticity from brands. The real and the virtual co-exist for these users and brands need to not only be present where these users are, but they need to do so in new and creative ways. Even brands that were not traditionally present in the gaming world have taken to adopting new ways to be present where the users are. Take the example of Honda, which is one of the many brands that are using partnerships with big titles to engage with a new generation of users. The company was recently named as the exclusive automobile partner for the League of Legends Championship series. The company also said the move comes as users move away from traditional media consumption towards social media and esports.
Image Source: Flickr/Justin
Myth 2: In-Game Advertising is Intrusive and Disrupts User Experience
Yes, bad advertising exists and that is certainly intrusive. But that doesn’t have to be so. Technological innovations in ad tech are creating a completely new advertising ecosystem, whereby ads can be introduced directly into the gameplay without harming game sessions. When done right, in-game advertising is similar to the ads we see every day in our daily environment — be it billboards or brand logos that exist all around us in our natural day-to-day space and “interact” with us. Gaming is not just a form of entertainment anymore and brands realize that it is the new way for young audiences to socialize. By using innovative advertising formats within the game, brands can explore opportunities to turn them into attractive marketing that is non-intrusive and get audiences hooked.
In-game ads can provide a new canvas for both brands and game developers. Non-intrusive advertising blends naturally within the game environment, such that creatives are placed conscious of the content and can create an immersive experience for the gamers. These unique placements create real-world brand ads that allow the user to make more personalized connections, making advertisers reach out to a whole new set of audiences that have remained elusive. For game developers, allowing in-game purchases or content add-ons without coming in the way of pure gaming experience is an intelligent way to achieve the balance between opening their games to new revenue streams without changing gaming environment that users are sensitive to. In fact, recent studies also suggest that when ads are placed in a conscious environment, sensitive to user experience, exposure to brand messages in games can increase brand awareness and perception.
Myth 3: In-Game Ads Don’t Offer Measurability and Viewability
Digital advertising experiences many issues such as ad fraud and adblocking. Advertisers are always looking for more insights into campaign behavior and customer action. Typically, tracking viewability metrics for media placements haven’t been supported in gaming. But with technological advancements and strategic partnerships in this space, ad platforms and cybersecurity vendors are working hard to provide solutions that can verify ads are delivered to the audience playing video games on PC and console. Current technologies in gaming are borrowed from the mobile environment but give much more data for advertisers to take the jump into exploring what gaming can do for their campaigns. They make it possible to measure the performance of campaigns in real-time, ad exposure time, and get detailed insights with various brand safety tools and brand lift measurement providers. These advancements will be critical in the creation of long-term trust and security in in-game advertising, providing advertisers with a new way to present and track ads inside video games. Using this can be a big pull for advertisers who have tested ad viewability in the mobile space and demand the same from video gaming.
Myth 4: In-Game Ads are Not Safe for Brands
Tightly connected to Myth 3, is our final point. After understanding viewability, now we can better understand and debunk the myths around brand safety. Advertisers experience fears of brand safety in social media where ad placements are not controlled and there are concerns around along where the ad is displayed. YouTube’s crisis earlier this year was a frightening call for many advertisers and as many as 250 brand advertisers pulled their ad spend after they found their ads were running next to extremist content.
This is not the case with gaming. PC and console gaming can offer a controlled environment for ad placement without the risks associated with user-generated content. Additionally, the availability of programmatic technology in in-game advertising has made it possible for advertisers to benefit from direct integration with SDKs to get greater control over ad placements and transparency.
In-game advertising also goes a step further to offer intelligent brand safety. In general understanding, brand safety is often understood as placing ads in content that is safe from pornography or hateful/extremist by nature. But in-game advertising takes the idea of brand safety to reputation and brand values as well. Since game developers are aware of the needs of the core gamers, they are careful of providing an environment for advertising that is conscious of the content displayed. For brands, too, it is prestigious to appear in big games, lending them a strong association and connect with the gamers.
In-Game Advertising: The New Frontier
Staying relevant in a changing media landscape is a challenge as audiences find new ways to consume media content. Common myths around in-game advertising are based on the lack of knowledge in the industry around what the media channel can offer. In-game advertising offers many benefits to advertisers as well can open up new revenue channels for game publishers. Propelled by advancements in technology as well as a change in advertiser and game developer attitude, the growth of in-game channels will lead the next wave of advertising.