With the declining efficiency of television promotion and increased fragmentation of mass media, brands are now shifting towards better platforms for communicating with their consumers. Therefore, in search of finding new promotion methods, in-game advertisings (IGA) came into existence. According to a KPMG report, advertising revenues in the casual gaming segment have aggregated Rs 36 billion in 2021. Also, it is the advertisers and publishers that dominate the monetization avenues for game developers in the current period.
As per experts, the gaming industry has witnessed a sudden surge during the COVID-19 lockdown. The most popular tech giant of the world, Google has also introduced new ways to target potential gamers who actually engage with brand content due to the opportunity to earn rewards.
Ankita Ashara, Brand Manager, PlayerzPot says, Mobile games have seen a growth of 32% in the pandemic of COVID – in and this led to the demand for in-app advertising in cost per installs (CPI) based models for the gaming companies. Fantasy sports companies like us are now considering in-game mobile ads as a long-term brand building strategy by going through the end of the digital funnel rather than a just short-term conversion. In-game ads are a win-win solution for both the brand and the user.
Though there are industry experts who say that in-game advertising has already disrupted the advertising space and it is not due to the pandemic. One of such experts is Mr. P.R. Rajendran, founder, and CEO, Next Wave Multimedia.
Pandemic or not, Mobile advertising has overtaken desktop advertising in the past few years globally and in-game native advertising is seeing fast-paced growth now. This format is high visibility, high engagement and unobtrusive. In the past few months, Indian mobile games are being partnered by global native advertising players with minimum guarantees and incentives for embedding their native ad SDKs in their games. The SDKs also provide 3rd party validation in terms of measuring campaign impact, which is very important for brands.
– P.R. Rajendran, founder and CEO, Next Wave Multimedia
To understand the discussion better, let us first know what exactly is in-game advertisings.
What are in-game advertisings?
In-game advertisings are referred to as every kind of built-in advertisement or sponsorship in a video game. For example, you are playing a fantasy cricket game and there are billboards, on-field advertisements, boundary line advertisements, etc. to make the game feel real. But, this sponsorship and advertisements not only represent real life, these are in fact real. Just like real-life brands sponsor these video games.
The in-game advertisement was introduced around the year 1978 in Adventureland. It was a very new concept of advertising then, to have an ad programmed to promote a new game. And, today it is the most popular form of advertising as more and more people are turning towards mobile gaming.
In mid-2020, India recorded a whopping 400 million gamers, which means there is an abundance of opportunities for brands and advertisers to connect with highly engaged customers in an immersive environment.
Gaming as an industry continues to grow at lightning speed, faster than we can imagine – both in hyper-casual mobile games, but also in the likes of esports.
And advertisers will follow where consumers are. As gameplay technology evolves and gaming becomes more mainstream, in-game advertising too becomes less intrusive, more seamless and more brand-safe.
– Adrian Watkins, Marketing & Growth Director APAC, AdColony
By now we are assured that more and more brands are utilizing the in-game advertisement space optimally. Brands are becoming more thoughtful and appropriate as they follow the pre-requisites and standards to place suitable ads within the game environment to the consumer experience.
As per, Dimpy Yadav, National Head of Client Engagement, Xaxis India, the experience becomes relevant for consumers and highly ROI-driven for brands as well with multiple ad-format and integration opportunities built by gaming companies. Brands are advertising with in-game branded billboards, virtual interactive stores, and tie-ins with real-world activity (e.g. pre-order sweepstakes), amongst other standard video & display ad formats. Also with the help of technology, the consumers are shown ads based on their interests and interactivity levels which makes the ads appealing for consumers too leading to an outcome-driven action for brands.
What kind of brands are most suitable for IGA?
The suitability of the brands depends on the type of in-game advertisings and the target audience of the brand. Let us first understand the types of brands and know what kind of brands are better suitable for which type. IGAs can be classified into Static In-Game Advertising, Dynamic In-Game Advertising, and Advergames.
- Static In-Game advertisements are integrated into a game during its design and development stage and hence can’t be changed later. This kind of advertising is suitable for global brands and is not looking for geo-targeting abilities.
- Dynamic In-Game Advertising lets advertisers update the advertisement even after the game is launched. It is best suited for advertisements that are seasonal or are for a limited period of time only.
- Advergames are custom-built video games that are developed only with the objective to promote a brand or product.
Coming to the second thing on which brand suitability depends is the demography of the target audience. Vaibhav Odhekar, Co-Founder of POKKT defines the demography of the current video gamers. He says, “With restrictions on outings and social-distancing, many have shifted to mobile gaming as their leisure activity irrespective of gender and age. Today women constitute almost 48% of our total audiences. Mobile game downloads saw a 39% surge during the initial period of pandemic and this adoption went on to keep growing.”
And, according to Ankita Ashara, Brand Manager, PlayerzPot, the in-game advertisements build audience engagement, and it is the ad content that blends into the gaming environment. These in-game ads are delivered programmatically and dynamically updated which offers brands an unprecedented creative opportunity. The cost of playing a game is no longer limited to the purchase of the base game. Now game makers are further expanding their revenue channels by selling in-game items that are supposed to give players the opportunity to improve their experience. These enhancements usually allow players to speed up their progression in the game by buying, with real-life money, items that would otherwise only be “earned” through game play.
How do brands earn through in-game advertisings?
We all have now understood that developers of a video game earn through the in-game advertisements by the brands. Now the question arises that how do brands make earnings through the IGAs.
In other forms of advertising, the advertisements are only one way, i.e., from the advertiser to the consumer. But, in-game advertisements being interactive and facilitating direct engagement, the brands get an opportunity to advertise through an interactive medium. Therefore, with IGAs brands can lead to more targeted and focussed promotional campaigns, with higher ROI and low upfront expenses.
In-app gaming ads provide a solution to a market channel i.e fragmentation of immersive experience. In the past, ad formats such as pre-rolls and interstitials tended to interrupt the gaming experience. With the recent growth of gaming as a marketing channel, it has created a gravitational pull for brands to adapt to a seamless integrated digital experience that leads to high engagement rates, interactions for brands leading to an effective and efficient ROI.
Gamified advertisements influence the purchase intention of the consumers which helps brands with their product or messaging acceptability. As gaming advertisements offer a wide array of integration possibilities, for brands there are no predetermined rules of engagement which means brands can innovate and interact with their consumers. With more experimental ads, the engagement and interaction rates are very effective leading to a cost-effective endeavour for brands.”
– Dimpy Yadav, National Head of Client Engagement, Xaxis India
Adrian Watkins also says that the growth of gaming resulted in the growth of not only gaming advertising, but of the metaverse. Everything (sports, pop culture, work, play) will exist in the gaming environment, and gaming has manifested itself in places where we would least expect it. For example, gamification is already prevalent in our banking apps, health and fitness trackers, and even our virtual bookshelves via apps like Audible. In short, gaming is rapidly becoming more than a single aspect of our culture. It is becoming our culture.
Games aren’t just a one-off advertising channel, they’re an entirely new marketing channel, and this will benefit brands looking to target audiences of all socio-demographics.
As per Ms. Ankita Ashara, the advantages of in-games also depend on the brand manager’s objective for the product or brand launch. This increases the click-through links. These ads are also a strong choice for a brand manager if the objective is to drive immediate action from the consumer such as website visits or app downloads. As a brand manager, in-game advertisements has many advantages, some of them being:-
1) The main familiarity of the brand increases
2) Brand rating increases
3) Purchase intention for the user increases
4) Reviewing of the commercial increases