The rise of in-game advertising

You are being chased by a dragon, his fiery breath is just steps behind you, you are just a few deep breaths from safety, and suddenly, a full-screen video ad appears on your phone reminding you that you are a very real person, on a very real train, and insurance is a thing.

This kind of intrusive, disruptive, and contextually misaligned tactic used to dominate in-game advertising. Games exist for us to escape, and in order to monetize and capture attention, many advertisers and gamemakers forgot this important fact. That was in-game advertising of the past.

This created two challenges:

1. For the games: They were typically harder to play, disjointed, and jolted people out of the experience.
2. For the advertisers: The poor ad experience could lead to negative recall.

In-game advertising is integrated more seamlessly than ever before. Three key factors drove this change:

• Gaming went mainstream: Video games are now widely adopted across genders and ages, bringing gaming culture out from the fringes.
• Costs to make games are high: The average Hollywood movie costs about $65 million. Grand Theft Auto 5 cost $265 million to produce. Cyberpunk 2077 cost $316 million. Gamemakers needed recurring revenue to help recoup their investment.
• Rewatch value is equally exorbitant: The worlds are so big, the stories so compelling, and connectivity allows for continuous reskins and map updates so games never get old. On top of replays, people watch other people play through channels like Twitch, giving brands that advertise in the games ongoing visibility.

The partnership between gamemakers and advertisers was needed to develop new revenue streams, much the same way social media influencers worked with brands. In that relationship, the influencer has built trust with their followers and leverages this trust to make brand recommendations. With in-game advertising, brands are presenting themselves at key moments in games that some players have been enjoying for years.

The gamer today

In the U.S., Statista reports that 24% of gamers are under 18 and 36% of gamers are between the ages of 18 and 34. This makes in-game advertising a likely no-brainer for brands looking to reach a Gen Z audience.

While many people are tightening their belts due to economic uncertainty, Insider Intelligence reports that Gen Z’s income is growing and they are spending more.

Get in the game

There are three types of in-game advertising:

• In the game
  • What it is: Think branded soccer jerseys on players, banners in F1 games, or product placement within the world itself.
  • Why it matters for brands: This can allow you to leverage a game’s authenticity and audience in ways that show you are a part of their culture.
  • What it does: Stiches your brand into the fabric of a game and gives feelings of legitimacy, authenticity, and credibility.
  • What you need: Standard digital creatives and logos. Reach out to your team at The Trade Desk to get a list of accepted dimensions and file sizes. (Disclaimer: Custom integrations will require custom creative, but everything can still be managed programmatically.)

• Around the game
  • What it is: Video ads that pause gameplay while the ad plays and returns them to the game with a reward for completion.
  • Why it matters: These are some of the most engaged and leaned in moments around a game when play is at a natural break. (E.g., you died).
  • What it does: Often rewards the user with extra lives, offering a tangible value for the user.
  • What you need: Standard video creative and an idea of what your customers are playing and how they want to interact with you.
• Away from the game
  • What it is: This is the surrounding content that is likely so valuable to gamers. This can be reading reviews, watching tutorials, and feats like speed runs where streamers try to break records on how fast they can complete levels.
  • Why it matters: This is a close cousin to traditional influencer marketing, because it often leverages both trusted influencers and publications to align with your brand’s audience, extending the in-game relationships to other open web properties.
  • What it does: Incorporates your brand into content outside of the game and makes it clear that you are an active participant in the wider culture.
  • What you need: A clear strategy, a list of publication partners, and standard digital creative.

Why video games go beyond traditional influencer marketing

One of the challenges with this tactic has always been measurement. Walled gardens make it challenging to pull insights out and measure within a holistic market’s strategy.

However, when it comes to video game advertising, you can track standard metrics like:

• Viewability
• Inferred Brand Intent (IBI)
• Brand lift
• Brand safety
• Conversions

Gaming can help generate opportunities and insights that can allow your brand to break through more easily. When it comes to reaching a younger audience, many brands are looking to gaming. It can even offer one-to-one personalization, optimization, and measurement that you might have come to expect from programmatic buys, especially with tools like Unified ID 2.0.

Reach out to your account manager to get started today.