In-game ads exploding: why non-intrusive ads embedded in games are growing

By John Koetsier April 21, 2022

Games don’t just have ads anymore. We also have entire games as ads. Even worlds as ads, as Lego builds out a kid-safe space with Epic in the metaverse. And increasingly lately we’re getting non-intrusive ads inside games. As in: inside the gameplay. On the walls. In the halls. Embedded right inside the actual architecture and artwork of a game, not grafted in via a rewarded ad loop or pasted in via an interstitial.

In-game ads, clearly, are the new OOH (out of home) advertising. 

In a very metaversy way.

In a sense, this is no shock. Everything is an ad network today, right? I mean, if Doordash, Zoom, CVS, Walgreens, and Instacart are ad networks, if Amazon owns a truly massive ad network, almost everything where people gather can be an ad network. 

Even ads can have ads, right?

And it makes perfect sense: movies and TV still occupy more of people’s time, around 2,000 hours a year, but gaming is closing in. While the average American spends only a few hundred hours a year playing games, binge gamers spend close to 500. And young people are increasingly tuning into games and out of TV.

Which means ad dollars have to go somewhere.

And games is one big and still rapidly-growing space with billions of gamers globally, many of whom don’t really watch TV much anymore, if they watch it at all.

“The way people are consuming media these days, you don’t reach 100% of your audience on TV anymore,” Steve Hartmann, a VP at Experian, recently told WSJ.

So where do in-game ads go?

If you’re not interrupting attention and highlighting your ad full-screen and requiring player interaction to continue, where do your ads go?

On the walls.

In the stadiums.

On the buildings.

On a jersey.

Wherever ads go IRL.

In short, wherever it makes sense given the construction of your game. So it could be a skin in Fortnite for players to choose. It could be the name of a stadium in your sports game. It could be real-looking (but virtual, of course) ads on the side of a race track.

And they can be designed right into the look and feel of your environment, like this in-game ad for a fake product, Nuka Cola, in Fallout:

in-game ad for a fake product, Nuka Cola, in Fallout

That could, just as easily, be a real product from a real company that is hoping to inspire real sales. And guess what: that real company could be you — the game publisher — cross-promoting another of your titles.

Ads in games: who’s leading the industry?

Microsoft is reportedly working on ads for Xbox games. That’s smart, because not only is Microsoft massive in gaming, having just acquired Activision Blizzard, it also has a significant ad network. That’s not just Microsoft Ads, which reaches almost a billion people, it’s also Activision Blizzard Media which — coincidently, perhaps — already offers an in-game ad product.

According to another report, Sony is working on something similar for Playstation. That could be used to support free-to-play games on the console, or reduce the cost of pay-to-play games.

(Grain of salt: both of these are unconfirmed by either Microsoft or Sony so far.)

The giants might be testing the waters, but there are multiple startups creating non-intrusive monetization solutions for games:

These are a few that come to mind. (Ping me with additional players if you see that I’m missing one.)

The value of in-game ads

Hey, money is good. It pays for developers (and marketers) and it keeps servers humming. But so do other forms of advertising. What’s good and interesting about in-game ads?

First off, they don’t interfere with gameplay.

Most ads are intrusive. Even if like rewarded ads they happen at the discretion of the gamer, they take gamers out of the world they’re in, out of the game they’re playing, and into a different reality. That may be a necessary evil, but even unnecessary evils are still … sort of evil. So letting players play seems like a good idea.

It’s also kind of free money.

I mean, you might have rewarded videos or interstitials. If so, there’s a natural limit on how many you can show and how often you can expect a player to engage with one of them. But a brand on a storefront is just there … it’s part of your playscape anyways. While it may not work for a game set in a primeval forest on a far-distant planet, it probably works for your game set in a fictional New York City.

And in some sense it’s kinda cool: real ads in synthetic spaces inside games. There’s a realism to that that can work really well.

Oh and guess what … you’re probably not feeding your competitors. Existing ads in games on mobile or console might tend to be for the kinds of things players in your game might like, such as games. In-game ads can be for brands in clothing or cars or laptops, making them non-competitive with your own games.

Challenges of in-game ads

Just because in-game ads offer some unique opportunities doesn’t mean they’re problem-free. While most can be very easily integrated via no-code SDKs, you’re going to have to make them fit somehow in your game.

So you’ll need some pre-thought and product work, at minimum.

In addition, because it’s in-game and intended to be non-intrusive, there’s no click or tap or linking out to an App Store or Google Play or console maker or publisher site. That means deterministic user-level performance data isn’t going to happen, and you’re going to have to rely on data science and mixed models and big data for next-generation marketing measurement.

It’s possible.

It’s doable.

But yes, it’s different.

That said, everything is different now as iOS uses SKAN and Android moves to privacy sandbox. And marketers are just having to adapt to new realities.

Talk to Singular

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