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What is In-Game Advertising?

The term in-game advertising refers to advertisements on the computer, online, and video games. The abbreviated form of the word is IGA.
In-game advertising can be static (SIGA) or dynamic (DIGA). Branded games, which are developed as ad-games or advergames around a brand or product, are unique.

History

The inclusion of advertisements in the computer or video games goes back to the 1970s. The game console manufacturer Atari was one of the first companies to integrate advertising banners into its games. The computer games market took up the concept and incorporated static advertising banners, preferably in sports games. With the development of online and browser games, in-game advertising gradually became dynamic. But it's only since games started running in the form of apps on smartphones and iPhones that the market has begun to boom.

Types of in-game advertising

In the classical form, only two types of in-game advertising can be distinguished - static and dynamic advertising. Particular conditions are ad-games and incentives.

SIGA or static advertising

The oldest type of in-game advertising is purely static. It means that the advertising is already firmly integrated into the game during programming and can no longer be changed. Especially in sports games, this type is still used today as advertising banners.

DIGA or dynamic advertising

This form of in-game advertising is very flexible. Advertising messages can be changed at any time. During programming, only positions are defined where advertising is to be displayed. What appears there is controlled by an ad server. It means that different ads can be displayed each time a new game or level is played. Geo-targeting can also be used to activate advertising measures according to time and target group.

Incentives

Incentives are a special form of dynamic in-game advertising that gives the player a direct advantage. They are realized as clickable advertisements or as advertising levels implemented in the gameplay. The player receives a game currency reward (usually gold coins or gems) or additional game inventory.

Ad games or advergaming

Ad games or advergames are a particular form of marketing. They are designed from the outset as interactive advertising media. Their purpose is to introduce the company or one of its products to the consumer or market them. Ad games combine both SIGA and DIGA. To launch them successfully, extensive research is required. Without the right online marketing agency, this can hardly be realized.

Practical application

Even though it may seem at first glance that one or the other type of in-game advertising is outdated or no longer appropriate, each has its raison d'être.

SIGA in practice

Static in-game advertising is already defined during programming and cannot be changed further. However, for offline games that run on consoles such as the Playstation or Xbox, they are the only available advertising form. But even in mobile games, which are predestined for dynamic advertising, static advertising makes perfect sense, such as supplementary perimeter advertising in a sports game like FIFA. SIGA is billed based on flat rates. Even though top games can generate sums of around 500,000 euros, the remuneration model is unsatisfactory. Especially with offline games, there is always a valuable amount of pirated copies, making pricing difficult. Due to the lack of interaction, static advertising measures can hardly be evaluated objectively.

DIGA in practice

Dynamic in-game advertising offers a high degree of flexibility but requires the player to be connected online. For browser or mobile games, this form of advertising is ideal. Advertising can appear in real-time on billboards, posters or banners, or is displayed during loading times. By including geo-targeting, advertising media can be explicitly integrated according to time of day and target group. What makes DIGA particularly interesting is the quantifiability of its effect. The position in the game at which an advertisement is best perceived can be measured, resulting in advertising spaces with different prices. Billing is based on actual contacts. Payment is made per thousand contacts. How high this thousand-contact price (CPM) depends primarily on the attractiveness of the game.

Incentives in practice

Incentives are the future. As part of the DIGA, they score points through an immediate gain for the player. For the advertiser, the advantage is that he draws the player's attention to himself and induces him to interact. This results in a win-win situation from which everyone benefits. Above all, the mini-games secure the company significantly more attention than an advertising clip. The marketer Gameloft Advertising Solutions provides a good example. A mini-game was developed around Air Berlin's Visit Helsinki campaign and integrated into various Gameloft games.

Ad games in practice

The development and programming of ad games are complicated and expensive. Their goal is to bring attention to the brand. The company's own branded game is the ultimate goal. Among the most successful are Minions Rush, Angry Birds, or the Star Wars series marketed by Electronic Arts. The Red Bull Air Race also belongs to this category. Based on the energy drink producer's entire racing series, Slightly Mad Studios and Wing Racers Sports Games take a completely new approach. Here, players control the light aircraft of a selected sponsor at the beginning of the game.

Dynamically created campaigns and a dedicated ad server allow the game's brands to be regularly updated. Also, out of the ordinary is Sea Hero Quest, a game developed on behalf of Telecom to collect data for dementia research. Even though Telecom itself is not an advertiser, the brand ultimately benefits because of social engagement. Developing successful ad-games requires extensive market analysis and careful planning. It requires an online marketing agency that has experience in in-game advertising.

The market for in-game advertising

According to Newzoo, a global specialist in games, eSports, and mobile applications, the market for games is booming. Especially for mobile games. According to figures published in Newzoo's Global Games Market Report, around $109 billion was generated worldwide in 2017 by nearly 2 billion gamers. Revenue growth was 7.8 percent compared to the previous year. The most substantial growth market is mobile games. They are growing by 19 percent annually and will account for more than half of the market by 2020. For 2020, Newzoo forecasts total sales of $128.5 billion, of which just under $65 billion will be attributable to smartphone and tablet games.

The German gaming industry is also growing steadily. Currently, sales here are three times higher than at the box office. For 2016, the industry association BIU states total sales of 2.9 billion euros. In 2017, the figure was already 3.3 billion euros. About every second, players play games, according to the BIU. Average age: 35 years, and almost half are female. In families, there is usually more than one gamer, and virtually all income classes are represented.

The market for in-game advertising is not yet fully developed. It is only with DIGA's new opportunities and especially the incentives that the foundations have been laid. The real boom is yet to come and is primarily linked to mobile games' growing market shares.

Important advertising rules

Several factors are crucial for successful in-game advertising. How long an advertisement is displayed plays a role, as does the minimum viewing angle. The latter indicates how an advertising message is best perceived within a 3D coordinate system. The more perfect the advertising message's view, the more expensive the advertising space can be sold. The most important rules include:

The expectations of the players

Especially in the browser and mobile games, players accept advertising, mostly if they are offered free of charge. However, players react negatively to advertising content that is perceived as personally irrelevant or disrupts the game's fun. Advertising must, therefore, be integrated into the game context and fit the game. Most players accept advertising during loading times. And thanks to modern ad server technologies, demographic data can also be used to display suitable content. Under no circumstances should the game's flow be interrupted or the fun of the game be diminished.

The right moment

Determining ideal advertising moments is a very crucial point. If advertising is presented incorrectly or in excess, players quickly react negatively. In a car racing game, for example, a banner ad that matches the game is not only accepted but makes the gameplay more realistic. It is crucial that the advertising message fits the content, has personal relevance, or is perceived as a valuable part of the game.

The right partner

It is advisable to bring an experienced marketing agency on board. They will not only take care of market research, app marketing, or the identification of relevant advertising positions. Still, they will also provide the advertiser with comprehensive support to have the desired success in-game advertising.

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