In-game advertising has proven to be a highly effective avenue for marketing, boasting excellent metrics like high ad viewability, strong viewer attention, and substantial potential for product purchases. However, despite its strengths, there are several notable drawbacks to consider.

The potential of in-game advertising for marketers

A joint study by Anzu and Lumen Research showcased the powerful impact of in-game advertising. In-game ads boasted a remarkable 98% viewability and held viewer attention for an average of 3.1 seconds, surpassing the norms for digital ads. These ads prompted a substantial 49% recall rate, with six in ten players likely to make a purchase after seeing them, highlighting their influence on brand preference and purchase intent.

In contrast, traditional ads face challenges like a 37% global ad blocking rate and increasing ad avoidance on TV and video platforms. In-game ads even outperformed ads on Facebook and Instagram. The study emphasizes the growing importance of in-game advertising in capturing visual attention and boosting brand recall as the market expands. However, limitations arise due to the narrower demographics of active gamers. However, there are several issues associated with in-game marketing. 

Firstly, the barrier to entry for in-game advertising is steep, requiring significant financial investment that often sidelines smaller brands and businesses. Moreover, unlike traditional digital marketing methods such as pay-per-click (PPC) campaigns, managing in-game advertising necessitates more than a simple button click. It demands meticulous planning, strategic formulation, and substantial budget allocation, which can be daunting for advertisers. Nevertheless, there are alternative approaches available.

In-game ads demographics

The gaming industry is witnessing an unprecedented surge, with approximately 3.09 billion active video game players globally. Forecasts indicate this number is set to rise to 3.32 billion by 2024, marking a notable 32% increase in seven years and reflecting the industry’s meteoric growth, estimated to be worth $385 billion.

Esports, a competitive segment within gaming, significantly contributes to this expansion. In the United States, boasting a $106.82 billion video game industry, there are over 3,000 active esports competitors, showcasing the nation’s dominance in this sector. Surprisingly, the US alone hosts a number of active esports players (4,283) comparable to the total of the next four leading nations combined (4,672).

The regional distribution of gamers is striking, with Asia emerging as a gaming powerhouse, housing nearly 1.5 billion gamers, exerting immense influence on the global gaming landscape.

Examining the gaming demographic reveals its broad appeal beyond a niche audience. Male gamers make up 55% of the community, with 52% subscribing to at least one gaming service, illustrating significant engagement levels within this diverse community.

Crypto and NFT utilization opportunities in gaming marketing

NFTs have ushered in diverse applications, expanding beyond player-centric utilities to embrace B2B opportunities, notably in advertising within the burgeoning metaverse and expansive gaming worlds.

• Acquisition of Digital Lands: Virtual universes within the metaverse concept have become hubs for socializing, working, and gaming. Major tech players like Microsoft, Meta (formerly Facebook), Google, Nvidia, Unity, Epic Games, and Roblox are heavily investing in developing these virtual worlds. The allure lies in redefining business, offering innovative customer connections, product sales, and experiences within the evolving digital landscape. Virtual lands present unique advertising spaces where brand placements can effectively raise awareness with enhanced data measurement capabilities similar to Out-of-Home (OOH) advertising.

• Branded NFT Skins: In Crypto Gaming, in-game assets such as skins, sold as NFTs, represent a substantial revenue stream. Collaborating with NFT game studios to create branded in-game assets, like hero skins or weapons, presents enticing promotional opportunities for brands.

• Tokenized Banner Ads: Despite the immense popularity of digital banners, increasing ad avoidance and ad-blocking pose challenges. Integrating banner ads seamlessly into gaming environments through NFTs and tokens offers a solution. Placing branded banners within games reduces ad resistance and enhances engagement within the gaming space.

• In-Game Reward Models: Leveraging in-game rewards for marketing purposes is deeply embedded in the Web3 space. Brands often partner with blockchain projects for NFT giveaways, attracting new users and boosting on-chain activity.

• Branded Event Sponsorships: Engaging and valuable events like sponsored tournaments with substantial prize pools have proven successful in promoting brands within the crypto sphere. Branded tournament arenas and Twitch streams drive significant engagement among thousands of players.

These approaches represent innovative ways for brands to capitalize on the immersive and expanding realms of the metaverse and gaming environments for effective advertising and brand promotion.

The future of in-game advertising?

Web3 marketing opportunities, while promising, encounter hurdles impeding widespread adoption. Challenges like infrastructure limitations, the volatile nature of crypto projects, and prevailing skepticism hinder the realization of the potential offered by this emerging landscape. The speculative aspect of many investments in the metaverse and NFT-driven initiatives significantly influences decision-making processes.

Despite these obstacles, there are glimpses of promise for crypto in the horizon. Notably, major tech companies’ substantial investments in metaverse projects signal a positive trajectory. Google’s recent update to its cryptocurrency ad policy, allowing NFT game projects on its Ads network and welcoming them onto the Google Play store after meeting specific criteria, stands as a beacon of hope. This move signifies a promising future for games utilizing non-fungible tokens when the largest digital advertising gatekeeper opens its doors to this emerging landscape.