Gaming: A New Frontier for Advertising and Marketing Innovation

By The Myers Report Archives
Cover image for  article: Gaming:  A New Frontier for Advertising and Marketing Innovation

Jack Myers TomorrowToday  projects investments in videogame advertising will grow from 2016’s figures of $1.9 billion to $2.3 billion in 2020.  According to the industry researchers at SuperData, as reported in PC World, the "worldwide gaming video content audience includes 665 million people."  And it's growing:  The company predicts a 21 percent viewer increase between now and 2021.  According to SuperData, there's now a bigger audience for gaming video than the combined audiences of HBO, Netflix, ESPN and Hulu.

With the immense popularity of gaming at the casual and professional levels, savvy marketers are effectively interweaving their brands into videogame environments to capitalize on the power of these digital worlds.  As revealed by a Nielsen study, even the simplest in-game advertising techniques, like Gatorade ads in EA sports games, can generate a large return in the form of retail sales increases of more than 25 percent.

Digital Marketing Tactics for Gaming Environments

As revealed on Cision PR Newswire, U.S. gamers collectively spend more than 50 million hours a day playing videogames, giving advertisers more than enough screen time to work with when promoting their brands.  From consoles and handheld systems to computer and mobile phones, the sheer diversity of gaming platforms gives advertisers many different effective marketing avenues to explore.

According to GameRevolution, mobile games lead the pack with a majority of the market share for ad revenues, while PC and console games lag behind considerably.  The shift toward advertising with mobile rather than traditional games has been steadily on the rise since 2012.  With popular ports for PC and console games, such as PUBG Mobile, advertisers have no shortage of marketing opportunities in the world of mobile games and their traditional counterparts.  

The big releases for console and PC gaming, however, keep interest levels up as the potential for great revenues still exists, especially at the professional tournament level.  Coverage by CNET reveals that the 2018 E3 convention introduced a wide range of shining contenders for the next few years of advertising in gaming.  EA proudly introduced Battlefield 5 as the next game for the top of the leaderboards, which will require knocking the wildly popular Fortnite down a few pegs.  Other exciting releases from EA include Anthem and Madden 19, which offer many static and dynamic advertising opportunities.

Role of eSports and Gaming Streams in Videogame Advertising Success

When gamers are not putting in the hours in their digital worlds, they are watching eSports and other professional and casual gaming streams in their spare time.  A single eSports competition has the potential to capture live online viewership numbers of more than one million people with many thousands of others in attendance.  Afterwards, replays of popular competitions continue to promote the brands and products advertised within the gaming content.  According to NewZoo, the global esports market will generate revenues of $1.1 billion in 2019, up 26.7 percent year over year, so advertisers should already be setting themselves up to capture their portion of the market share. 

In addition to advertising at local and national eSports competitions, advertisers can turn to successful video game streaming stars on Twitch, YouTube and other video-sharing platforms to achieve their marketing goals.  Even moderately popular channels net millions of views on each of their videos for hours upon hours of marketing opportunities.    

Major Players in the Videogame Advertising World

With billions in videogame advertising revenues up for grabs, many major companies have jumped on the bandwagon in hopes of great returns. RapidFire revealed that Disney, for example, added colorful static advertisements for its Pete’s Dragon film to a number of games on the Steam platform to build up interest before the summer 2016 release date.  NBCU, Time Warner and Discovery Channel have all also put their hat in the ring with smart ad campaigns using videogames, according to Mobile Marketer.

The extraordinary success of the 2016 release of the Pokemon GO app by Nintendo encourages advertisers to think outside the box by supporting innovative gaming styles.  The unique style of gameplay promoted real-world exploration, which captured the attention of a much wider audience than traditional games typically do.  As reported by TechCrunch, within just one year after its release Pokemon GO became the fastest to reach $1 billion in revenues.  Even with its decline in popularity in the last year, up to $2.5 million in revenues still comes in each day just from this app alone.

At either end of the spectrum, advertisers are watching the game streaming viewership boards to see where to focus their advertising efforts.  As compiled by WePC using NewZoo data, the 10 most popular games to watch on livestream are:

  • Fortnite
  • League of Legends
  • PlayerUnknown’s Battlegrounds
  • Dota 2
  • Overwatch
  • Hearthstone
  • Counter-Strike Global Offensive
  • Sea of Thieves
  • World of Warcraft
  • Grand Theft Auto V

Advertising experts do not have to hone in on just the most popular titles, however, as lesser known franchises and indie games can offer excellent marketing opportunities as well.

Landscape of Ad Formats Set to Change

The sheer effectiveness of static and dynamic ads in videogames will continue to support their use well into the next decade and beyond.  For example, as a FIFA partner, Adidas has always played a large role in the franchise’s videogame designs with well-placed ads.  As gaming graphics improved, characters started sporting Adidas gear and using iconic ball designs to achieve much success in further promoting the brand.  Racing franchises, such as Forza and Gran Turismo, employ a similar approach to successfully advertise their brand partners and supporters.  

With the rise in popularity for virtual reality equipment, immersive gaming experiences will undoubtedly add even more value to branded products and static advertisements placed in these digital environments.  The ability to digitally examine, manipulate and utilize branded products and view static ads up close can speed up brand familiarity in phenomenal ways.

In the world of mobile games, however, advertisers continue to search for the sweet spot.  The development of both playable and rewarded ads is hoped to take the sting out of pop-ups to improve user engagement, positive brand recognition and click-through or conversion rates.

Across the board, advertisers need to gear their ads to male and female gamers alike to support the influx of female videogame enthusiasts.  Forty-six percent of people who regularly play videogames identify as female, according to Big Fish Games.  In response, videogame developers have been increasing their representation of women in videogames, so marketers need to follow suit with the use of equally inclusive advertising strategies.  

A Future of Innovation: Projections for the Years Ahead in Videogame Marketing

With advertising investments approaching $2.5 billion by 2020, and as technology improvements support more immersive gaming environments, advertisers will enjoy even better returns through the direct interaction with their brands and brand messages in gaming environments.  New creative approaches and e-commerce strategies will be required, creating new revenue opportunities for promotional, creative and direct marketing agencies as well as media brands that can extend their franchises to incorporate a relevant gaming experience.

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