gaming and advertising

Top score: The power of in-game advertising

January 2021

Video gaming might be fun, but it’s also very serious business. According to a report by Newzoo, the global games market was worth $159.3 billion in revenue in 2020, and is predicted to pass $200 billion by the end of 2023.

“No longer the bedroom recreation of the nerdy male teenager, gaming is now mainstream”

There are an estimated 2.81 billion gamers in the world, whether they’re pensioners bowling on their Wii or teens competing with each other on Fortnite. No longer the bedroom recreation of the nerdy male teenager, gaming is now mainstream. A report by the Entertainment Software Association found that women make up 40% of the gamer population in the US, and 26% of people over 50 played a video game in 2020. 

A captive audience

And gamers are incredibly engaged. Hooked, even. This is not new, as anyone who remembers spending all their pocket money on arcade games in the 1980s will tell you. (The story goes that Space Invaders, an early video game produced by Taito, once caused a shortage of 100 yen coins in Japan.) But as technology has improved, the gaming experience has become even more immersive and engaging. That’s why brands are beginning to wake up to the enormous power of in-game advertising (IGA).

“Not only is the audience diverse, global and hyper-engaged, but games also offer brands all kinds of inventive ways to reach them”

Not only is the audience diverse, global and hyper-engaged, but games also offer brands all kinds of inventive ways to reach them. Marketers can subtly weave messaging into the game so that they’re a feature rather than an annoyance.

Virtual billboards: static IGA

Some types of in-game advertising are programmed in at the design and development stage. They appear as billboards or product placements which are an integral part of the game’s storyline, and players can interact with them.

This type of advertising doesn’t use geo-targeting, so it’s great for global brands but, as it’s a permanent fixture in the game, it’s not so great for time-sensitive campaigns.

Do you DIGA?

Then there is dynamic IGA (DIGA), where ads are integrated live into the game. During Barack Obama’s 2008 election campaign, for example, billboards were deployed in 10 swing vote states through Xbox and its gaming catalogue.

Ads are delivered via a server in real-time, in the same way that banners are served on websites, and media buyers can place them in games that have already been released.

“Dynamic IGA offers brands all kinds of opportunities for in-game merchandising and brand experiences”

This type of IGA offers brands all kinds of opportunities for in-game merchandising and brand experiences. And because it’s dynamic, you can update and change creative assets and messaging in real-time.

Dressing up and telling stories

With the gaming industry looking so healthy, it’s no surprise brands are keen to get in on the act. In one of the most popular games of recent years, Animal Crossing: New Horizons, players could dress their avatars with recognisable designer outfits by the likes of Valentino and Marc Jacobs – a type of product placement known as ‘skinning’. Louis Vuitton, meanwhile, designed ‘skins’ exclusively for two of the main characters in League of Legends.

Customers can buy these luxury ‘skins’ using in-game tokens, competing with each other to wear the most desirable labels – and brands that might have been out of reach in real life become accessible in the virtual world. Some brands such as Moschino have gone further, designing real-world collections alongside the in-game equivalents.

“The beauty of dynamic IGA is that it gives brands the chance to turn product placement into a creative art”

The beauty of dynamic IGA is that it gives brands the chance to turn product placement into a creative art. Once a practice that was seen as somewhat ‘seedy’, it can be an opportunity for real storytelling. That – and the fact that it is the entertainment platform of the future – is good reason for it to be a major part of the marketing mix.