Posted by With the US gaming industry garnering a massive market share – generating over $100 billion in revenue each year, and expected to reach $600 billion by 2029 – could it be a vastly untapped marketing frontier for advertisers?
Despite the incredible numbers, gaming makes up only about 5 percent of most digital advertising budgets, according to the Interactive Advertising Bureau (IAB) who hosts the annual PlayFronts convention, an event which encourages ad dollars to enter the gaming space.
The Entertainment Software Association says there are upwards of 190 million gamers in the US alone, not counting the additional population who watches live streams. Last year, consumers spent 32.5 billion hours merely watching people play. Why the reticence to get in front of such an enormous audience?
Amanda Rubin, chief revenue officer at Wildfire, says part of the problem is many marketers view the gaming ad landscape as highly segmented. The contingent playing solitaire or Candy Crush may be vastly different from consumers immersed in Call of Duty. And mobile gaming is widely different from the content found on social platforms like Discord. “None of those ad units are the same,” she said. “You need a gaming budget, but it’s like, ‘What type of gaming?”
Discord alone boasts a monthly active base of 200 million users, where advertisers are already offering in-game incentives called “Quests.” These incentives were designed to appeal to a demographic who “since the day they were born, were pressing the Skip Ad button,” says Peter Sellis, Senior Vice President of Product at Discord. He notes that 10 percent of users are currently opting in for the Quests.
Then there’s the coveted Gen Z and Gen Alpha audiences – an elusive demographic marketers are eager to reach. Devoting some ad spend to gaming spaces may be “the key to reaching younger audiences,” said executives from the media company, Bent Pixels, since these users often livestream for hours at a time.
“Just a few years ago, gaming content was simply viewed as tips and tricks, cheat codes, and let’s plays,” says Louis Timchak III, Vice President of West Coast sales at Bent Pixels. “As we’ve all witnessed over the last years, it has evolved exponentially into livestreams, in-game integrations, custom maps, e-sports, alignments, sponsorships, and much, much more.”
Other advertisers indicate concern over proper vetting, with the plethora of creators and gaming content available online. According to Unju Saffer, Bent Pixel’s Vice President of East Coast Sales, brand “safety and alignment in the creator ecosystem now requires extensive amounts of vetting and research to properly qualify and validate if these creators, their channels, and platform are the right and appropriate place in your brand.”
How will the game play out? Will marketers come out of their huddle and start to bet on the immense potential of the gaming audience?