An “untapped opportunity” exists in the gaming market, according to a new study published today.
Despite the global gaming sector generating revenues of almost $184bn every year, reaching 3.4bn people, in-game marketing spend remains low.
The newly publicised WARC Global Advertising Trends report – Gaming: Advertising’s untapped opportunity, found that advertising in games remained “stubbornly low.”
“Gaming is huge, both in audience and cultural impact, and its highly complex ecosystem spans devices and platforms defying conventional definitions of a channel. Gaming has long been heralded as a vital emerging opportunity for brands, particularly those wanting to reach younger audiences,” said Alex Brownsell, Head of WARC Media.
“However, in-game advertising spend remains low. This may soon change, with game publishers focused on improving ad monetisation. But evidence is needed to make the case for gaming as an advertising medium.”
Separate research from Newzoo found that 72% of 35-54s and 46% of over 55s game at least once a week, with 2 in 5 people around the world being active gamers.
According to an IAB survey, nearly 90% of advertisers agreed that gaming was a “brand safe channel” as a result of improved tools such as fraud deduction, context and age rating, ads interactivity and engagement metrics.
That said there remains caution in the marketing sector.
In the US, for example, advertisers are forecast to spend $6.7bn on in-game ads in 2024, up 10% year on year. That’s equivalent to 3.7% of total US digital ad spend – according to Dentsu.
One of the issues, according to the report, is the complex ecosystem of the gaming sector. It means brands can chose between numerous touchpoints to reach gaming audiences – from creator content on Twitch, to Discord discussions and e-sports sponsorships.
Plus publishers are still working on how they can prove the effectiveness of in-game ads.
Furthermore, gamers are playing for different reasons. According to Activision Blizzard Media:
53% play video games to escape from everyday life;
63% see gaming as a good way to spend time with family and friends.
And in terms of mobile gaming, Newzoo found that 48% played with more than 1 device.
“Gaming is a whole entertainment ecosystem, not a channel, and is stealing share from entertainment platforms. However, clients haven’t grown up with gaming, and feel less confident with the opportunities,” said Jo Pereira, SVP Strategy, Media Futures Group, EssenceMediacomX.
Nina Fedorczuk , Chief Enablement Officer, Omnicom Media Group Asia Pacific added:
“Gaming requires attention. It’s unlikely that gamers multitask in-game; everything else is just background noise. ⟮For brands⟯ it’s a matter of keeping that attention, and not jolting gamers out of it.”
In-app advertising has seen major growth in the past year. Data from Unity suggests a 26.7% year-on-year rise in average revenue per daily active user resulting from in-app ads.
Companies such Roblox are also working to boost advertising revenue, but according to the report, such expenditure may be ineffective without adequate support in other channels, particularly social, which are key to facilitating discovery and engagement.
