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In-Game Advertising: Brands at Play

In this contributed article, Justin Townsend, CEO of leading in-game advertising network IGA Worldwide, and Ed Bartlett, IGA’s Vice President of Publisher Relations, offer advice to brands wanting to get in the game.

Game On

Since Sony launched its first PlayStation console in 1995, videogaming has enjoyed a rapid transition from the bedrooms of pubescent boys to that most coveted of locations; the space under the living room TV. The demographic has also changed accordingly. Those teenage boys have grown up and now sit nicely in the 18-34 bracket; their wives and girlfriends regularly join in play, particularly with social games and more mainstream offerings like karaoke. The Nintendo Wii has even been credited with getting grannies out of their chairs; its motion-sensing controllers limiting the intimidation many non-gamers feel when exposed to outwardly complex controllers for the first time and allowing such diverse activities as bowling, fishing and even yoga.

In financial terms, the numbers speak for themselves. Thanks to a typical suggested retail price of between $50-60, a single game can generate astonishing revenues, smashing the average cinema box office takings for a Hollywood blockbuster. In 2007, sci-fi epic Halo 3 took $170 million in the U.S. alone on its first day on sale, and with an increasing trend for post-release “add-on” content for purchase and download via online-enabled console services such as PlayStation Network or Xbox Live, games can continue generating revenues long after release.

Most importantly the amount of time the typical gamer spends playing each week is also increasing, averaging between 10 to 15 hours depending upon the territory. Not only is this a similar amount of time typically spent watching the television, but research has also shown that much of that activity takes place during what would traditionally be seen as “prime time” for TV viewership. And since play is increasingly taking place in the living room, this trend has a major knock-on impact on the viewing habits of the entire household.

So, it’s clear that gaming poses a growing threat to advertisers wanting to reach the young professional demographic via traditional TV ad spots, but it compensates by bringing with it some of the most exciting, engaging and measurable opportunities to be found on any media plan.

Let’s take a look at some of the more popular options being utilized by brands today:

    Dynamic advertising: In-game advertising is fairly unique in media terms in that gamers actually want to see real brands and advertising, adding as it does a further sense of environmental and contextual realism within these increasingly photorealistic virtual worlds. A study by Nielsen Interactive Entertainment found that over 70 percent of gamers responded positively to the presence of real brands and advertising in games, providing it was contextual.

    One of the most recently developed in-game offerings has been established largely on the back of this fact. Dynamic advertising combines outdoor-style ad formats with a TV network aggregation model and uses the internet to update, change and even track the viewing of advertising placements in a game in real-time. The aggregation of a potentially unlimited number of games, genres and platforms into a network combats fragmentation and allows for extremely high potential reach, even when sub-sampled into specific geo-demographics.

    The advantages to this model include the ability to serve high value “above the line” creative into an extremely engaging entertainment environment. Dynamic in-game ads also provide extremely high accountability versus traditional ATL ad mediums, thanks to a combination of a uniquely engaged audience, minimum-size-on-screen impression thresholds and a CPM-style trading metric, the combination of which effectively guarantees delivery. It also offers the ability to go live with a new campaign within hours, and to localize messaging by territory.

    Once network reach hits critical mass and metrics are proven and standardized, buying dynamic in-game advertising will be as natural and commonplace as TV, print, outdoor or online. Advertisers already active in the space are wide and varied, including Intel, Burger King, MTV, Coca Cola, P&G and GM.

    Static advertising: Static advertising describes billboard and logo placements that are “hard coded” into the game environments before the game launch. This was the primary form of in-game advertising until the advent of the internet-enabled dynamic advertising model.

    Static in-game ads allow you to guarantee reaching every user of the game, regardless of internet connectivity, and they are still the only way to reach users of certain platforms, such as the Wii, which are not yet enabled for dynamic advertising.

    The limitations are that it is impossible to accurately track ad viewing metrics, or to update or switch off campaigns. Long lead times for creative also need to be in place, due to game approval, mastering and distribution processes. There is also fairly limited geo-demographic reach in any one single game title compared to a dynamic buy.

    Static placements are likely to be substantially replaced by dynamic advertising inventory as volume and penetration of internet-connected game platforms increases, except for in cases such as licensed sports games where the real-world sponsors would be integrated statically.

    Product placement: As with product placement on the big screen, there are growing opportunities for brands to include products within popular videogames. However, games are able to go that crucial step further by allowing the player to actually interact with a product and to experience product features and benefits.

    No other medium allows marketers to get a fully operational, photorealistic and physically accurate model of their goods into millions of hands in a contextual setting before the product has even hit the shelves. Early adopters of product placement included Red Bull, who were able to show product benefit by boosting the energy of the in-game character.

    It is also now possible for product placement to be tracked using similar technologies to dynamic advertising, allowing for more advanced metrification. There is also the ability to insert and update 3D geometry with a view to fully dynamic product placement; however, as with a film script, the linear nature of game design and development means that this is unlikely to become truly scaleable.

    Advergaming: As the name suggests, advergames are bespoke interactive games based entirely around a brand, product or branded event. Historically they have been fairly simple web-based games due to the need for a cost-effective mass-reach distribution channel.

    Advergaming can be 100 percent on-message and provides exclusive share of voice. Moreover, these types of games are typically very sticky, engaging users with easy-to-play, fun dynamics and often a high score element to keep people coming back.

    More advanced console-based projects, such as the 2007 Cannes Lions Titanium Grand Prix-winning Burger King Xbox 360 games have brought production values up to date, and digital distribution channels on both console and PC will make finding the relevant (mass) audience easier.

Are you playing?

With traditional media on a continuing decline as users demand more control, choice and interactivity, it is clear that advertisers must not only follow their audience, but that they need to be one step ahead.

As consumers become ever more media savvy, going out of your way to engage with them on their terms and at their level is the new Holy Grail. In this as much as any other respect, the advantages of gaming and in-game advertising simply cannot be ignored.

Now read Justin Townsend’s predictions for the future of in-game advertising.

Justin Townsend is CEO of IGA Worldwide, and Ed Bartlett is IGA’s VP of Publisher Relations.

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