I realised I was a gamer when I didn’t sleep three consecutive nights playing EverQuest, which was a popular MMORPG sold at retail.As I take a look at what being a gamer used to be and what it is now, I’m fascinated by the dramatic shift that has occurred.
Currently, there are virtually no physical discs and the freemium model is dominating every vertical of the gaming market.
More than half of all logins to Facebook are to play games, so clearly being a gamer has changed, it is now mainstream.
Everyone knows a grandmother, mum or an adult who loves playing games on Facebook. As our culture redefines being a gamer, brand partners explore and wait eagerly on a new set of tools to better engage their potential clients.
Facebook Is A Game Platform.
Facebook is now the world’s largest game platform. With the latest release of Facebook’s APIs, points and achievements are being recorded from deep within the game. It was publicly announced recently that credit revenues are in route to trump ad revenues, a major portion of those credit revenues stemming from games. The world is watching as gaming is reinvented with new tools.
I recently spoke about Virtual World Advertising at the Digital World Expo in Las Vegas, and one of the main themes of the presentation was that in-game advertising 1.0 has died. The other was that platforms such as Facebook were redefining how brands live within games in advertising 2.0.
In-Game Advertising 1.0 Is Dead
Every gamer remembers the horror of the idea that brands were going to start popping up in games. Second Life was the exploratory ground for many brands. I remember seeing a Coca Cola machine in a game and debating my existence as a gamer. It was asking me to design a Coca Cola machine within Second Life, and if I won, my Coca Cola machines would be littered throughout the Second Life world.
To be clear, it is not Coca Cola’s wrongdoing. Coca Cola was innovative and pushing boundaries at the time in the ways it was creating brand recall within game. The problem was with the medium, Second Life wasn’t a very big game to begin with and to launch a campaign within it was clunky and expensive.
Other salient issues with in-game advertising 1.0 were:
- Long lead times – advertisers often had to be in the game before it shipped
- Cost prohibitive – could be very expensive
- Static in nature – difficult to dynamically update
- Intrusive due to lack of in-game utility
The white flag was raised in-game advertising 1.0 when Massive Incorporated once acquired for more than $500 million by giant Microsoft was shut down in October of 2010.
Advertising 2.0 Is Here To Stay
As we look at the shift in gaming, we are starting to see many of these previous issues self-correct.
In-Game Advertising 1.0
In-Game Advertising 2.0
Call of Duty, Grand Turismo
Farmville, Happy Pets, Mobile
Cost of Game
High-end gaming machines usually required for high-end games
Most computers built within the last five years can handle games
Creative typically required before game ships
On-the-fly can be added post-game launch; fairly easy to build brand’s creative in game
Lack of Virality
Word-of-mouth and seeing your friend on Xbox Live or PSN was the only real way for games to go viral
Facebook has revolutionised social games, as friends can see your points, achievements and in game events
Online PC Gamers 25.9M
Console Gamers 32.9M
Facebook Gamers 350M
iPhone Gamers 67M
This mass adoption of games has lead to a great audience for brands. Most Facebook games don’t require a $10,000 water-cooled gaming PC, as free2play titles are playable within seconds. The Zynga’s of the world have mastered onboarding to retain as many players as possible by A/B split testing every minutia of the game. These factors in the new-spectrum gaming have ceded way to massive audiences, high engagement and – ultimately – an open book for brands to explore.
It is helpful to divide the forms of in-game advertising 2.0 based on the level of integration into the game:
Titan Gaming’s “Games and Prizes” awarded players with real-world rewards as they completed in-game achievements.
Advertisers World Within a Virtual World
Dreamwork’s Megamind within Farmville
Real-World Orders Within a Game
Advertiser Charles Chocolates allowing users to order Chocolates from within the Chocolatier: Sweet Society game.
Branded Virtual Goods
Rango, Sims and Pokémon badges living within Habbo Hotel badges.
Virtual Goods with Utility
Clorox provided a Happy Pets Litterbox where users did not have to clean the litterbox for additional days.
In-Game Video Ads
Users watch videos powered by Social Vibe in exchange for an in-game item or virtual currency.
After speaking to a panel of advertisers at the Digital World Expo, we all arrived at the same conclusion: the strongest format of in-game advertising 2.0 was the one with the deepest tie-in and where the user had the most positive experience. We also agreed that, for the most part, the metrics used to track the success of in-game advertising 2.0 campaigns are measured by:
- Unique number of users
- Time spent
- K Factor
- Likes added on Facebook
- Retention (1, 3, 5 day retention patterns)
- Conversions (signups, purchases, subscriptions)
Overall, the achievement-based rewards, like those powered by Games And Prizes, on Facebook where players win real-world prizes have the greatest potential to deliver the maximum impact. This format seems to create natural brand ambassadors, and the data proved that over 25 per cent of users successfully invited one friend to compete in these achievement-based rewards.
If a real-world prize is just not possible from the advertiser, then the second-best format is virtual goods that provide in-game utility. This still provides positive sentiment towards the brand and is not seen as a nuisance.
As a gamer I know that my least favourite ad types are offer walls. Offer walls halt gameplay and often times lead to a forceful spam-filled offer or signing up to a service I didn’t even want in the first place. This is a broken gaming experience.
This problem is also an opportunity for advertisers to gain a competitive edge by understanding their fans and launching campaigns that have meaningful value and positive experience. The time spent planning and executing these in-game advertising 2.0 campaigns will certainly translate into real-world customers and real-world sales.