In a rapidly evolving digital world, where audience attention is the hot, new currency, marketers can no longer rely on just traditional advertising channels to reach consumers. One industry that is disrupting the digital advertising ecosystem and attracting billions of users is gaming. According to the IAB, gaming is third only to TV and social media in terms of how audiences spend their time
Gaming is the most under-indexed channel in advertising right now: With billions of gamers spending upwards of 6 hours in immersive environments all over the world, in-game environments are one of the most sought after places for advertisers to connect with engaged and diverse audiences.
In this blog post, we will dive into the fundamentals of in-game advertising and how it is revolutionizing digital marketing as we know it.
The Rise of In-Game Advertising
In 2022, 3.2 billion people around the world played games of one kind or another! Undoubtedly, the gaming audience is huge, engaged and more diverse than ever - offering a massive opportunity for advertisers. In fact, there is at least one gamer in 75% of American households, every other European is plays video games and 53% of Canadians play video games regularly. Now - imagine harnessing the power and impact of this audience!
What is In-Game Advertising?
Before we jump into the basics of in-game advertising, it's important to understand exactly what we are talking about. In the simplest terms, in-game advertising is a type of digital advertising that displays image, video, and audio ads inside video games.
Today’s in-game advertising strategies typically fall into one of three approaches: in-game (the ad is placed in the gaming environment intrinsically, adjacently, interstitially, etc), around the game (the ad is not in the gaming environment, but is still a part of the gaming ecosystem) and away from the game (gaming industry events, eSports, or streamer ad buys).
The Modern Gamer
Playing video games has become a mainstream part of our day, whether it’s gaming while on your commute to work, waiting for your kids after school or at the end of the day as a way to relax. When is the last time you played a mobile game on your phone?
Plus, gaming is the one medium where a user is fully engaged and attentive. If you think about when you watch TV, you are most likely also on your phone as well right? When a gamer is playing a game, their sole focus is on that game, giving 100% of their attention to it!
We might typically assume gamers are younger, and there’s some truth in that. Two-thirds of people in the US under 18 years old play video games online, putting it only behind watching YouTube videos as an activity.
But gaming is big among adults as well, particularly mobile gaming. You might be surprised to learn that the average U.S. adult spends 27 minutes playing games every single day. That’s about 13% of all the time spent within mobile applications. And it doesn’t stop there - 75% of gamers are female and the average gamer is actually 34 years old, owns a house and has children.
The modern gamer has a growing influence, opening up new opportunities for brands, publishers, creators and communities to connect with their target audience.
Benefits of Advertising in Video Games
Here are the top benefits of in-game advertising that make it such a promising marketing channel:
Reach a Diverse Audience of Gamers
A 2022 Entertainment Software Association (ESA) report showed that 52% of gamers identified as male, and 48% identified as female, and that most gamers range in age across a few generations. This proves that the gaming audience encompasses a large range of people, who are diverse in their demographics, interests and purchase intentions.
Build Brand Awareness
Intrinsic in-game advertising helps you reach your target user in a non-disruptive, highly-viewable environment. You’re able to connect your brand with a captive audience who is unlikely to be multitasking, which increases the likelihood of brand recall and awareness. Brand awareness can expand your target audience, increase website traffic, increase brand affinity, and drive consumers further down the purchasing funnel.
Create Non-Disruptive Ad Experiences
Intrinsic in-game ads are seamlessly integrated into the game environment as audiences play and therefore appear before engaged audiences without disrupting their gaming experience.
Explore New Targeting Strategies
In-game advertising provides the opportunity to test unique ad formats that are exclusive to in-game environments. Plus, you can reach new audiences through emerging technologies and generate ad revenue in new environments.
Why You Should Invest in In-Game Advertising
The worldwide advertising expenditure on mobile gaming is projected to increase from 46.7 million U.S. dollars in 2021 to 130.9 million U.S. dollars in 2025.
Now is the perfect time for you to explore in-game advertising while there is ample inventory and the space is not over cluttered. You have the opportunity to be an early adopter of in-game advertising and enter the landscape before it becomes mainstream.
With in-game advertising, you can:
• Be a First Mover: There may be 3.2 billion gamers in the world, but advertisers spend just 5% of their budget on in-game advertising.
• Expand Your Reach: Already vast, the global gaming audience is expected to grow.
• Be in Brand Safe Environment: Most gaming networks today curate a list of games that are relevant and safe for brands to advertise in.
A Win-Win-Win Scenario
In-Game ads are also beneficial for all of the key stakeholders in the gaming environment. With in-game advertising - everybody wins. For game developers, in-game advertising empowers them to enhance the gaming experience and generate more revenue.
For gamers themselves, the seamless integration of in-game ads stops their experience from being constantly interrupted. As they are more engaged, they are more likely to pay attention to the ad messaging within the game itself.
And then, we come to the brands. For brands, it’s a no brainer. You’ll get the opportunity to reach this incredibly valuable audience, capture consumer attention and protect brand equity - all at the same time.
Types of In-Game Ads in Video Games
There are four main types of in-game ads:
• Intrinsic Ads: The ad placement is inserted within the gaming experience natively and does not interfere with gameplay.
• Interstitial Ads: The ad placement is around the game, as gameplay stops and the ad itself becomes the focus.
• Adjacent Ads: The ad placement is next to the game, such as a banner image ad below a mobile puzzle game.
• Audio Ads: The ad placement is purely audio in nature, overlaid during gameplay without pausing the game.
Intrinsic In-Game Ads are Preferred by Gamers
Intrinsic in-game ads are ads inserted within gaming experiences natively. By natively, we mean that they might appear on in-game billboards - just like in real life. So, when you are running through a video game as a character and you run past a billboard - that ad is delivered within the experience.
When gamers are playing games, the very last thing they expect to see is a set of interruptive ads that get in the way of their ability to see the full screen, or impact their ability to play the game. But ads that appear natively in the environment; intrinsically belonging in the game itself, are a very different matter altogether!
In-game advertising can be effective in its own right, but intrinsic in-game advertising not only works due to the seamless integration of the ad into the gaming ecosystem, it works because it puts the player experience first above all else; the gamers experience is never interrupted.
A a recent survey showed gamers preferred intrinsic in-game advertising over any other in-game ad format.
Intrinsic ads aren’t disruptive to gameplay, but users playing the game can still spot them and identify the products they’re advertising. Nearly two-thirds had experienced intrinsic ads when gaming.
Intrinsic in-game ads are preferred and are gaining traction: intrinsic ranked above adjacent, interstitial and audio ads. Intrinsic in-game ads are not only the most effective, they’re the least disruptive. More than twice as many respondents named interstitial and adjacent ads more distracting than intrinsic ads.
Similar to the investments being made with out of home billboards or stadium chyrons, intrinsic in-game advertising is growing due to the growth in gamers worldwide and the introduction of new tech that seamlessly integrates your advertising content into a mobile game. Intrinsic In-game ads give the games a sense of realism and credibility and therefore, are widely accepted by gamers.
Top Lessons to Be Successful in In-Game Advertising
For advertisers to be successful in our rapidly evolving digital world, it is vital to meet audiences where they are most present and engaged - which is why understanding and investing in in-game advertising has become imperative for marketers looking to achieve growth for their business.
To gain a foundational understanding of in-game advertising, explore different ad types and learn how to create successful in-game ad campaigns, check out GumGum's new snackable video series that contains expert advice, relevant research and useful tips about breaking into the in-game space.
It's undeniable that the boom of gaming culture into mainstream entertainment means that it is an influential marketing force that can no longer be overlooked. It's not just about niche audiences anymore, it's about recognizing the power, reach and engagement of worldwide gamers.
By aligning their marketing strategies with the values and interests of different gaming communities, brands have the opportunity to reach a variety of audiences in ways traditional advertising methods can’t duplicate.