It’s perhaps now old news that this year, consumers are spending more time online, TV viewership is up, and mobile activity is through the roof. And as many of us with kids understand, video gaming is seeing a similar lift. In fact, this year, U.S. consumer spending on video gaming rose 24% to $11.2 billion in the third quarter from a year earlier, according to the NPD Group.
Continued growth in this area has led to a promising frontier where marketers are currently testing commercials in the world of console videogames, such as Xbox and PlayStation. This untapped resource has high-reach potential for younger audiences who are often missed via traditional advertising.
Advertising to gamers is not a new tactic – digital advertising has already experienced success on mobile and social media games, and Business Insider estimates that “ad revenues from gaming video content — ads within gaming-related videos on platforms like YouTube and Twitch — [are predicted to] grow 13% in 2020 to over $2 billion.”
But will console gamers adapt to this content placement? Consumer reception of advertising in games on their Xbox, PlayStation, and other consoles has been mixed:
On One Hand…
There has already been some pushback. Gaming consumers are not used to this unskippable interruption, so it was sometimes viewed as “distracting and annoying”, words a good marketer never wants to hear. Plus, these ads would run on a platform where consumers have already purchased dedicated time and space to play free of interruptions.
On The Other Hand…
Experimental advertisers have already had early success with showing ads via consoles. They have done so by designing the ads to appear less intrusive through integrating the creative with game tie-ins and branding, or by releasing special content available only for console game viewers.
Additionally, brands are showcasing their advertisement to gamers and offering free in-game perks. In exchange for watching the :15 or :30-second commercial, the gamers may receive points or rewards they can redeem in the game. For players, these ads can offer a means to obtain items and perks, or immediate advancement to a next step or phase in the game, all things that otherwise would require an in-game purchase. This positions the message as less of an ad, and more of a tool they can use to progress. To be clear, the gamer does not even have to watch the ad to receive these points!
Rewards-based video ads like this are already seen in mobile and social media games but are new to console games played on TV screens. For this to be supported via consoles, more game producers would have to adopt these in-game rewards offers.
As we follow the development of breaking into this new market, we’re eager to see how gaming parent companies will roll out marketing opportunities, which brands or industries will be the first to adopt console gaming marketing, and how young gamer audiences will react to seeing more ads integrated into their activities.
To learn more about the latest marketing trends, and how those trends can drive smarter marketing strategies, contact Morgan & Co. today. Our team is dedicated to integrating the newest media trends available for our clients.