In 2023, video gaming is no longer niche: According to Insider Intelligence, more than half of the US population will play video games this year across a wide range of devices, games and experiences. But while gaming has never seen higher engagement with players, its impact on advertising is decidedly less prominent — with lingering misconceptions of what the gaming audience truly looks like and technical hurdles preventing media buyers from fully embracing gaming as part of their omnichannel strategies.
But times are changing. With recent, high-profile announcements coming out of New York Advertising Week 2023 and developments in how ads are presented to gamers, the potential of gaming to stand alongside streaming video and digital audio as a cornerstone of connected media has never been closer to realization. Read on to discover three key reasons why gaming is poised for a breakthrough — and what advertisers need to know to make the most of it.
Try to conjure up an image of a video game player. Odds are you're thinking of a teenage or young adult male with a controller in his hand and a set of earphones on his head.
While that may have been true a decade ago, the well-worn stereotype of the average video game player in the United States doesn't align with more modern research. That starts with gender identity: According to Frameplay's Network Insights Summary report, players in the US are split evenly between those that identify as male and female. And beyond that, while players do generally skew younger, video games are continuing to gain traction among older generations. In fact, a 2022 AARP survey showed more than 52.4 million people age 50+ play video games, making up nearly a quarter of the entire gaming population.
Frameplay CEO Jonathan Troughton summarized this idea in a recent eMarketer Tech Talk webinar with TransUnion and Datonics using one simple sentence: “Gaming is as diverse as the human race.”
Because video gaming is so widespread, players run the gamut of interests, socioeconomic statuses and audience profiles. According to the same Frameplay Network Insights Summary report, players on the Frameplay network spend more than the average US consumer in the children’s products, health, home and garden, and personal care categories, in addition to electronics (as you might expect). Coupled with the fact gamers spend on par with the US population when it comes to other key categories like automotive and apparel, another thing is made even more clear: Gamers aren’t just gamers. They have well-developed interests and spending habits outside their hobbies.
In essence, video gaming audiences are less sub-groups and more representative of the US as a whole; in some cases, indexing even higher than average in certain highly desirable buying behaviors. Advertisers are likely to find video game players among many — if not all — of their target audiences, making the ability to reach them how and when they’re most engaged even more important.
With more than 3 billion players globally in 2023, there’s no denying gaming is an entertainment juggernaut. That begs the question: If video gaming is such a widely enjoyed pastime among so many segments of the population, then what’s stopping video gaming from becoming an advertising powerhouse?
The answer, as it turns out, is actually “not much.”
In fact, in-game advertising on mobile devices is already seeing something of a golden age, especially on mobile devices: According to recent estimates from Statista, mobile gaming advertising revenue in the US is expected to hit $7.87 billion in 2024. To put that in perspective, that’s nearly double the estimated ad revenue from podcasts in the same year.
This sort of mobile dominance should come as no surprise. With 90% of digital gamers playing on a smartphone or tablet in 2023, mobile is by far the largest slice of the video gaming market, and has the lowest barrier for advertisers seeking entry. As well, the majority of video game ads out in the market today are interstitial mobile ads, appearing in between pieces of (often bite-sized) content in mobile games. Interstitial inventory has a significant appeal for advertisers looking to dip their toes into gaming, giving media buyers the ability to reach mobile gamers worldwide with full-screen creative in contextually relevant gaming environments.
While mobile interstitial ads make up the majority of gaming advertising today, there’s another format making inroads with advertisers and gamers alike: intrinsic ads. As the name suggests, intrinsic ads are formatted to look as though they belong in the game — without breaking immersion like a full-screen interstitial ad might. Think about a stadium billboard in a yearly sports release. Ads look like they belong in the game world while still delivering messages that are all but guaranteed to be seen by players.
The numbers back this up: According to Frameplay, intrinsic in-game ads are the most preferred ad type among surveyed gamers, distracting them less and influencing their future purchase decisions more. But getting intrinsic ads in front of gamers has historically been easier said than done. Unlike interstitial ads, intrinsic ads are difficult to standardize, often meaning individual integrations must be built on a game-by-game basis. This can create an environment where advertisers leveraging intrinsic in-game ads have to make tradeoffs between campaign scale and a less intrusive experience for players.
That said, even though intrinsic in-game ad technology is still relatively new, it’s developing quickly. Player preference for intrinsic ads is hard to ignore, and recent consolidation in the AAA game space means there are fewer roadblocks standing in the way of standardization of ad types and technologies. For example, Microsoft’s October 2023 acquisition of publisher Activision Blizzard puts premier titles like Overwatch, Call of Duty, Candy Crush and Halo all under one roof, opening the possibility for advertisers to access gamers across all those different experiences without having to build ad hoc integrations for each one.
The video game advertising market is on the cusp of a transformation. With vast, diverse segments of the US population picking up smartphones and controllers every day, and gaming ad tech progressing by leaps and bounds, video gaming has the potential to reach millions of engaged users in contextually relevant ways. For video game advertising, the future truly is now.
To learn more about how TransUnion can help you integrate video gaming audiences into your own connected media campaigns, contact us at AudienceHelp@transunion.com.