In 2022, it was estimated that 227 million people in the US played video games and 46% of those were women. With game revenues projected to reach $285 billion by 2027, it’s no surprise that this is a huge opportunity for advertisers.
In-game advertising offers businesses the opportunity to reach out to a very wide demographic with eclectic tastes. Almost any product, catering to any demographic can be promoted effectively through in-game advertisements because gaming itself has become a universal pastime.
Video games and ads have come a long way in the last few decades. Search marketers and celebrities alike are embracing the gaming industry as a huge market to reach their target audience. This is the first article in our new series on why video games as a huge opportunity for advertisers in 2023.
What are video game ads?
If you’ve ever played a video game on your mobile phone, PC, or consoles like Xbox or Playstation, it’s likely that you’ve seen several types of ads. These may be in the form of a short video that plays between levels, a banner at the bottom of your screen, or perhaps one of the player characters is wearing a branded shirt or driving a popular make and model car. All of those examples are types of video game ads.
In addition to brands being able to reach new audiences, grow their community, and sell more products or services, game publishers like ads because it allows them to monetize their content. This is especially attractive to mobile game developers who offer a freemium experience, where the game itself is free to play, but ad spots are sold in exchange for a fee.
Who should consider creating an in-game ad campaign
Any brand or advertiser looking to expand their marketing campaigns outside the normal scope would be a great candidate to invest in an in-game ad campaign. Since gaming platforms have evolved, players have consoles right in their hands, which put ad campaigns in front of them at all times.
An in-game ad campaign can help your brand become more visible on platforms that are relatively low competition. You can also reach very specific audiences by advertising on certain game titles. In 2020 the number of gamers worldwide reached about 3.6 billion, so if you have a brand that can benefit from a large audience, in-game ads are a huge asset. If you know who the typical gamer profile is, and who you are trying to reach with your campaigns, you can tailor your message to reach that exact audience.
Natalie Cooke, group managing director at M&C Saatchi, believes that brands can engage gaming audiences – particularly when it’s done right. She noted that Burger King successfully engaged with Elden Ring players on their own terms by encouraging streamers to only use fire- and flame-based weapons and spells within the game world. Since it was a challenge of the sort that many streamers like to impose upon themselves, it felt authentic and true to how gamers like to create content.
The best type of video game ads for most brands
When most people hear the phrase “gaming consoles” they think of Xbox or Playstation. While advertisers can certainly set up ads within these consoles, the market share of players represents only about 32%, and the demographic tends to be male-dominated.
Mobile games are by far the lowest-hanging fruit and the biggest opportunity for advertisers right now in 2022. Since gamers of all ages play on their mobile phones, this platform represents the largest possible audience.
Mobile apps are also the easiest and fastest to set up. Once you know who your audience is and what mobile games they’re playing, you can create and deploy a campaign within minutes. For mobile campaigns, the KPIs you’re most likely to measure are impressions and clicks, and video completion rate.
The benefits of mobile game advertising for brands
Despite this reach and depth of engagement, marketers have been slow to tap into this attention oasis with advertising in games accounting for less than 6% of total digital ad spend.
Shifts in people’s perceptions of gaming, along with technological advances in the way ads can be inserted seamlessly into games, are helping to ease some of the publisher and consumer resistance to implementing ads in games.
With mobile gaming audiences on course to reach over 3 billion by the end of 2023, it represents a huge segment of the population advertisers can potentially be in front of. In-game ads are also more cost-effective than other forms of marketing.
In-play ads such as banners run during the entire length of the game versus interstitials or rewarded ads only play during breaks. Ad tech companies are working hard on solutions to enable measurement, even on faster-paced games. With this, advertisers will be able to determine how many views their ads are getting. With measurement in place and extensive ad targeting capabilities, fraud protection, and brand safety measurements, in-game ads are becoming more attractive.
A report from Tapjoy stated that 64% of consumers are more likely to engage with a retail in-app reward ad than a social media post. That added value of in-game rewards in addition to the transaction makes gamers feel like their money is going further. Additionally, 70% of the gamers surveyed said they were open to trying a new subscription product or service.
4. Brand safety
Advertisers can select the genre of game they want their ads to show. Additionally, ad whitelists prevent their ads from appearing in inappropriate environments.
Advertisers and brands interested in setting up an in-game campaign should speak with an ad tech partner that can help them navigate creative requirements, audiences, placements, cost, and more.
Creating in-game ads
Knowing your target audience
For brands that are interested in creating mobile in-game ads, the first thing to consider is the target demographic. Is it the busy mom playing Candy Crush? What countries are they located in? What do they do other than play games? Are you advertising a product, service, or another game? What platforms will you advertise on? Snapchat? Apple? Discord? Twitch? Consider the demographic you’re targeting and where they’re playing.
Game titles are another factor to consider when looking to advertise in games. For example, users of Candy Crush tend to be over 30, while Fortnite players are under 18. League of Legends and DOTA are popular among younger Asians. Counterstrike players are mostly European and North American males between 20-30. When a brand is considering advertising its product, service, or game, they need to ensure they’re promoting it through the right game titles. If your target demographic is women over 40, you’d be wasting your ad spend having your banner show up in Fortnite because your demographic isn’t ever going to see it. There needs to be a consideration of what games your demographic is playing before creating a campaign.
Contextualization is key when beginning to plan an in-game ad campaign. It’s critical to understand your market, learn the game space, and understand how players will interact with the ad. Brands that are self-aware of where they are advertising will see greater success, as not only age and gender need to be considered, but country, game title, and even some ethnicities. Brands should also consider the motivations of the players they are advertising to. Are they playing to pass the time? Are they competing with their friends? Or are they strictly playing free games and are willing to watch video ads to power up?
Knowing player motivations
Game Refinery identified eight player archetypes to help advertisers narrow down their target audiences. It’s not required to use these archetypes to create an ad campaign, but it helps to know the type of player you’ll be reaching, how they interact with the games you’re advertising on, and what other products and services they may subscribe to. The eight archetypes are:
Expressionists love to express their identity through gameplay
King of the Hill players prefer games with a high degree of competition with other players
Networkers see gaming is a social activity
Skill Masters are always trying to improve their skills
Strategists enjoy strategic thinking and planning
Thinkers enjoy brain teasers, puzzles, and anything that will improve their cognitive skills
For Thrill Seekers, gaming is all about excitement and action
For Treasure Hunters, Exploration is the main motivation
Capitalize on any first-party data from apps
First-party data is any information game developers and marketers collect directly from their audience. Many times that data comes from players and customers acquiring, converting, or playing within an app. Companies use that information to create ads, content, and experiences that cater to the players’ interests.
Second-party data is also collected directly, but instead, it is transferred to a partner instead of being used directly. Third-party data comes from outside sources that collect the data from sources, aggregate it, segment it, and then sell it to various companies.
First-party data is valuable because it’s all advertisers have to rely on, since the implementation of Apple’s ATT (App Tracking Transparency). First-party data is also preferred because it’s more accurate (it comes directly from the consumer), advertisers can collect the exact data they need for specific campaigns, and it can be managed in real time so advertisers and platforms can learn and adjust accordingly.
You can use first-party data by creating highly personalized messages and targeting those who are looking for your product or service.
Knowing the answers to these questions and researching your audience’s intentions can help brands create a campaign that motivates people to engage with their ad. “Gaming is very different than any other channel. It is 100% interactive. It is live. It is a high-attention inventory. It is many things that traditional advertising isn’t, so the rules of traditional media planning are not always applicable to in-game advertising” says Julia Rast, Director of Global Solutions and Innovation for the media company Xaxis.
Measuring success with an in-game ad strategy
While navigating the landscape of video game advertising can be tricky, the Interactive Advertising Bureau (IAB) recently put together a group of industry stakeholders to develop new standards of measurement for viewability for in-game ads.
Anzu has also announced a collaboration with Oracle Moat to measure the viewability of in-game ads across inventory and describes it as “first-to-market.” Since in-game ads often take the format of billboards, buildings, apparel, and more, they can be hard to measure. Anzu has developed built-in ray casting features “sending out waves of rays from the player’s point-of-view that help to determine how long ads remain in sight, the percentage of the ads viewable and other essential metrics.”
Current success is typically measured in terms of viewability but is based on how long the ad stays up on the screen, how long the ad was viewed, the speed at which it moves across the screen, and the lighting when the ad is seen.
For banner ads, success can be measured in clicks, downloads, purchases, or any other goal the advertiser has set up. However, it should be noted that if the banner or expandable ad interferes with gameplay, clicks should not be measured as success as many of them can happen by accident.
If a brand’s goal is impressions and viewability, rewarded ads may be the best option, as they typically have the greatest viewability rates because they’re tied to game rewards.
Surveys are another way to measure in-game ad success. The surveys are sent to players to complete in exchange for an incentive to the player. This is a simple and effective method but advertisers should consider the game(s) in which the surveys are going, the native language of the majority of the players, the game titles, and whether or not players are being truthful in their responses.
As gaming evolves, developers, platforms, and advertisers are learning more and more about creating experiences for their players. Viewability is an excellent benchmark to start measuring success, but as technology evolves, other KPIs will paint a more clear picture of effectiveness. For now, brands should focus on awareness and viewability.