Advertising in video games

This a guest post by Sean Ammirati, VP of Business Development at mSpoke.

eMarketer report on video game advertising

Explaining to media executives that it’s getting harder to engage an audience’s attention is like explaining rising fuel costs to the aviation industry — it just isn’t necessary. Two themes that are consistently mentioned when reviewing digital lifestyle devices are how they make it easier to multi-task and avoid ads.

However, one medium that is emerging as a great platform to deliver relevant ads to a receptive and engaged audience is video games. Advertisers are taking notice; according to research released in April by eMarketer the worldwide market for in game advertising was estimated to be over $690 million last year and growing at over 20% annually projected to almost $2 billion by 2011.

How Does it Work?

For marketers that want to reach the gaming audience there are two basic approaches:

  • In Game Advertising
  • Advergames

In Game Advertising

Tactically, there are a number of ways to deliver an advertisement into a gaming environment. At the extremes, the placement can be dynamic and served through an server or just a static image included in the game. While in-game advertising is certainly becoming more, according to Wikipedia the first in game ad was delivered in the 1978 title Adventureland. The ad was actually for another upcoming game by the same publisher.

Advertisers are also becoming more sophisticated about their media buys for games. Fran Kennish, Senior Partner at MEC MediaLab, wrote an excellent article on Do’s and Dont’s of In Game Advertising for iMedia Connection.

The key takeaways were:

  • A brand’s presence should enhance the gaming engagement
  • Brand and commercial content must be relevant to the game
  • Brands should feel like a natural part of the game
  • Customization can strengthen gamers’ engagement with a brand
  • In-game communication must be measurable

EA Fifa soccer in-game adSports games have been one of the strongest video game verticals for in-game advertisements. This is because integrated advertising is actually part of the experience. I witnessed this a year ago, when my nephew brought EA’s Fight Night Round 3 and PlayStation console on his visit. He commented that one of the things he thought was cool about the game was the realistic banners in the stadium and the ads in the arena.

At this point, I became a believer in the concept of in-game ads. The most comparable experience I could think of was watching the Super Bowl and everyone knows how valuable those ads are. This hasn’t been lost on Microsoft, and a year ago the company acquired Massive (terms not disclosed) to ensure the ability to serve ads as part of their adCenter network. Beyond Massive Inc, the other major player IGA Worldwide is still independent and is the leader in providing dynamic ad placement inside of games.

Advergames

Beyond sponsoring a game, some marketers are actually creating their own games as promotional content (called “advergames”). The eMarketer report mentioned earlier, estimated $164 million was spent in this niche and is expected to more than double to $364 million by 2011. A popular example of this style of game are the three titles Burger King created with Blitz Games for the XBox and XBox 360 platform. The games retailed for $4 plus the cost of a value meal from Burger King. To see what the experience was like and the Burger King brand integration, check out Wired Magazine’s slide show.

Burger King advergame

Conclusion

It is getting more difficult to capture the attention of audiences today. Delivering ads to them or even creating games specifically with the goal of improving your brand awareness is a compelling way to reach difficult audiences. While the market is still small, the growth projections look promising. What do you think? Is this a new source of revenue for game publishers and a strategic priority for marketers? Leave your thoughts in the comments.

last100 is edited by Steve O'Hear. Aside from founding last100, Steve is co-founder and CEO of Beepl and a freelance journalist who has written for numerous publications, including TechCrunch, The Guardian, ZDNet, ReadWriteWeb and Macworld, and also wrote and directed the Silicon Valley documentary, In Search of the Valley. See his full profile and disclosure of his industry affiliations.

One Response to “Advertising in video games”

  1. Kathleen O. says:

    You are very right. Just in the past year since you’ve wrote this article In game advertsing and advergames have taken off. Any ideas on how to find advertisers for advergames that will be running during the superbowl?

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