Live from Games Forum: In-Game Advertising Explodes
More and more advertisers are looking at video games as a medium to connect with a young demographic in relevant and emotional ways, and are turning to in-game advertising to do it.
In-game advertising is a $28 billion global industry, and in three years time, the tactic is projected to more than double to $56 billion worldwide, Mitchell Davis, CEO of Massive, Inc., a New York-based video game advertising network, told attendees yesterday the Advertising in Games Forum.
“This is a very intense media,” Davis said during his keynote address. “We’ve seen a coming together of the industries [advertising and gaming]. It works well.”
Gamers like in-game advertising because it adds realism to the experience, so long as it make sense in the game. Publishers like the tactic for its ability to reach the elusive, male 18- to 34-year-old audience. In a world cluttered with different forms of media pulling for consumers’ attention, marketers today are turning toward in-game advertising to reach busy consumers and to stay relevant, Davis said.
Massive specializes in dynamic ad placements (ads that can be changed on an ongoing basis and are not burned into a game’s coding). Since the networks’ launch last April, some 38 publishers have signed up for in-game advertising with Massive, Davis said. More than 60 brands have tested the tactic, including Coke, ABC, Nokia, Subway, NBC, Gillette, Honda, The History Channel, MTV, Universal, Panasonic, New Line Cinema, Warner Bros. and Panasonic.
The market is rich for advertisers. Some 112 millions gamers are 13 and older in the U.S., and by 2008, that number is projected to grow to 148 million, per Nielsen Research. Moreover, 70% of all gamers are males 18-34, according to the NPD Group.
Thanks to the popularity of video games and declining interest in TV, in-game advertising is only going to “explode” over the next several years, Davis predicted. By 2010, in-game advertising will become a $3 billion market globally, per Jupiter Research; by 2013, the tactic will be $2.5 billion globally, according to Nielsen Research.
In the 12 months since Massive launched, in-game advertising “has gone from being a good idea to a good business,” Davis said. “It’s good for advertisers.”
What’s the future of in-game advertising? Massive plans to build integrated benefits into games connected to the Internet, including power-ups and the ability for gamers to earn points in the game, Davis said.
