Gaming was one of the big winners of the pandemic, seeing an increase in players and viewers willing to tune in to live streams on platforms like Twitch. Like many other digital categories once boosted by COVID-19 shutdowns, the story has quickly changed. Video game growth has bounced back to Earth in recent months, in line with an overall less certain economic picture. There is also a concept of high profile releases after blockbusters earlier this year, such as ‘Elden Ring’.
Still, flattening doesn’t discourage gaming marketers. During a virtual roundtable held Monday by the Interactive Advertising Bureau (IAB), representatives from brands, agencies, platforms and developers remained highly optimistic about the category, seeing it as an important channel for targeting a young audience — and also as a channel benefiting significantly from more robust tools to match its anchoring in the cultural mainstream.
“It was a bit unreasonable to expect that we won’t see some sort of decline from that massive amount of engagement,” said Paul Mascali, PepsiCo’s head of gaming and esports, during a Q&A portion of the media-only event. “I still think it’s an important focus for us. I don’t think we’re necessarily shocked by the declines in overall game sales.”
Recent marketing moves support the argument that the industry is not shying away from a cooling off period. Esports deals are more common, with companies targeting diverse partners in the professional gaming arena. Kellogg’s Frosted Flakes just reinvented its mascot Tony the Tiger as a virtual Twitch streamer, or VTuber, who plans to compete in battle royale games with popular creators. And on the agency side of the business, specialty stores are gaining traction. The Omnicom Advertising Collective unveiled a custom solution for a range of gaming tactics for customers earlier this week.
“We need to move away from siloing gaming as this niche activity. It’s mass entertainment,” said Zoe Soon, vice president of the IAB’s Experience Center. “We’re not saying, ‘Is my brand right for TV viewers?'”
Up for an upgrade
Even now that gaming is ubiquitous, the marketing infrastructure surrounding it is less well-rounded compared to other channels. The IAB has made a concerted effort this year to close the gap. In the spring, it held the inaugural Playfronts, an event dedicated to buying media in games, which attracted hundreds of attendees, some of whom returned Monday for the roundtable discussion.
The trading group is also updating the in-game ad measurement guidelines it first introduced in 2009. The playbook previously relied too much on the existing digital ad model, according to Soon, and didn’t do enough to address the specific issues. features of messaging in 3D worlds. While greater industry standardization is long overdue, rethinking the topic has revealed issues specific to in-game ads that can be difficult to fix.
“If a branded object like a shoe is in view, but the Nike swoosh isn’t in view — it’s not rotated to where the player can see it — does that count as a rendering? We’re going through all those little edge cases,” said soon.
Better metrics may be needed to assure marketers that in-game ads are worthwhile. Mascali said PepsiCo focuses on two types of game advertising: dynamic in-game advertising and what he described as a “hard-coded” approach, infusing the product into the experience from the get-go. The latter tactic relies on close collaborations with the developer, which can be labor intensive, but provide clear integration. The former has been generating more traction lately, but faces its own set of challenges.
“The new guidelines will only help us better assess value overall and make us a little more comfortable,” said Mascali of Dynamic In-game Ads. “It will give our internal media teams and agencies a little more confidence in the value we’re getting back.”
“We’re still trying to figure out, as more developers begin to embed this dynamic advertising feature into games, how we can give that value back to our brands,” he added.
The Holy Grail
Marketers and agencies are yearning for more granularity in the broad sense, especially as the pandemic has helped diversify the reach of gaming beyond its historical hold on young men. An oft-cited statistic suggests that nearly half of gamers in the US are now women.
“Gamer” in general has a richer definition today than it did 10 years ago, encompassing everything from followers of hardcore shooters like the Call of Duty franchise to those who casually swipe through mobile puzzle games on their commute. Still, it’s an area where many brands are stuck in narrow-minded thinking.
“Before the pandemic, sub-segments weren’t necessarily something marketers were looking at,” said Keith Soljacich, head of innovation at Publicis Media. “They’ve bucketed gamers into their own sub-segment. Now it’s so prolific and so widespread that you can find your audience within the gaming community instead of forcing the gaming community into your audience.”
Efforts to cater to a broader group of gamers can be seen in trends such as a proliferation of sponsorships targeting female organizations and creators. But as much as they tout gaming’s progress in reaching new audiences, brands clearly have one demographic priority in their ongoing quest to crack the industry code.
“More and more, gaming is marching towards ubiquity, especially with the Gen Z and younger generations,” said Soon. “Gen Z is like the Holy Grail as they age into the household decision makers and the main lenders.”