Building Brand Association through In-Game Advertising
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1 Building Brand Association through In-Game Advertising Gaming is a multi-million dollar industry today. In the US alone, more than 120 million people regularly play PC or console based games, and the US video gaming industry is predicted to reach $12 bn by year T h i s p h e n o m e n a l g r o w t h h a s p r o m p t e d marketers who had thus far not considered gaming as a serious marketing channel to explore the medium with intent. Recent advancements in animation and communication technology offer a tremendous scope to explore this medium as a way to reach out to the target audience base. This white paper is meant to give clear insight and create awareness on how gaming could be used as one of the channel of integrated media communication to covey the brand message to its target audience.
2 About the Author Ramakanta Panda He is a member of the Incubation Marketing team at TCS Mumbai. Prior to that he has three years of work experience in Marketing Hi-Tech products at ESAB India Limited, Kolkata. His educational qualification includes BE in Mechanical engineering followed by MBA in Marketing. His areas of interest include Digital advertising, Social Media marketing and Web analytics. 1
3 Table of Contents 1. Introduction 3 2. In-game Advertising Market 3 3. In-game Advertising Modes 4 4. In-game Advertising Players 5 5. Metrics on In-game Advertisements 6 6. Insights 6 7. Conclusion 7 2
4 Introduction In a market swamped with products and brands, marketers are forever on the look out for novel ways to make their brand presence felt. In-Game advertising has given them the platform they need to get a whole lot of involved audience experience brands in a novel way. Some of the brands that are already vying for space in this segment are Ford, Jeep, McDonald s, Shell, Axe etc. With the growing penetration of different types of PC and console based games along with a host of mobile games, there is no dearth of space for marketers to put across their message to the target audience. Popular dedicated consoles include Sony PlayStation, Microsoft Xbox and Nintendo Wii. A few console-specific games, however, hamper the marketer s reach, but with the increase in involvement of In-Game ads this shortcoming will no longer be an issue. In-game Advertising Market With the release of popular games, the penetration of consoles is increasing day by day. The Sony PS3 is predicted to touch a figure of 17 Mn units installed base followed by Nintendo Wii at 14 Mn and Xbox at 9Mn, respectively, by Meanwhile, the growth of the casual game market is poised to touch a figure of $2bn in US this year. A study carried out by emarketer predicts that the PC and console based In-Game advertising revenue in the US is likely to reach $1 bn by With the addition of mobile game advertising revenue, this figure is set to hold a significant promise for its stakeholders. $1,200 $1,000 $800 $600 $400 $200 $ Figure 1: In-game advertising market in the US 3
5 In-game Advertising Modes Today, advertisers are using various In-Game advertising modes for brand promotion. Adver-game is a set of small games built around a theme to grab the player s attention to a particular brand in an entertaining way. These simple, yet challenging games are free of cost and require no high-end software to play them. Besides, they help in increasing the web traffic because it involves the audience in an intrinsic way in delivering the brand message to them. You could try out an adver-game at: Static In-Game advertisements, on the other hand, are placed directly into the game and cannot be changed later. These ads appear as a billboard or loading screen every time the game is played. The challenge in such advertising, however, lies in engaging the player in a non-intrusive way; else, not just the ad but the game itself can go for a toss. Whereas In-Game dynamic ads are updated every time the game is played as the gamers PC or console is connected through the Internet. Google Adscape has developed a program to serve dynamic ads in games in line with Google s Adsense program. The best part about dynamic ads is that marketers can track user behavior and show relevant ads realising a better return on investment (RoI) on the ad spent. Some consoles like Nintendo Wii, however, do not allow ads to show up in their consoles. Another drawback is that the number of players in online mode playing MMOG (Massively Multiplier Online Game) games is not quite large. Interstitial ads appear during idle time in a game. For example, while a game loads, the initial screen can show up ads; or when a player wins a game, the winning message could be accompanied by some ads. While playing games in Facebook, you can view ads while transitioning from one level to the other. Thus, such idle avenues are the ideal time to showcase ads. Figure 2: Obama campaign pic in one of the game at Xbox live The illustration below shows the various types of In-Game advertising and how each form of advertising serves a different purpose for the advertiser, with its pros and cons. Type Used for Platform Lead time Players In-game Static In-game Dynamic Advergame Creating brand awareness Encouraging the intent of purchase Attracting attention and conveying a message Console and PC Xbox live, PS3 Mobile, PC (Online), PDA High-more than a year Real-time delivery Medium-within six months Figure 3: In-game advertising forms and their usage Seaga, EA, Konami, Sci Massive, IGA, Double fusion Enpocket, Skyworks, Digital Chocolate 4
6 In-game Advertising Players Currently, the three major payers in the In-Game advertising field are Massive (Microsoft), Double Fusion and IGA Worldwide. They provide the major technological support in this space. Microsoft-owned Massive Incorporated has access to PCs, Xbox and the Xbox 360 platform. Any marketer who intends to use these platforms for ads should come through Massive only. It currently works with more than 40 game publishers, among them game developer EA (Electronics Arts) is a prominent name. Double Fusion, through its fusion runtime ad solution, offers a host of In-Game advertising solutions In-Game static, dynamic and adver- games to developers. These cost-effective solutions are provided through a simple patch addition to the existing games. Double Fusion is one of the significant players in the virtual world forums like second life. IGA Worldwide has an ad serving network called Radial, and they claim to reach out to more than 30 million gamers. Through their network, an advertiser can reach the premium retail PC and console games including Sony PS3 examples include games like Counter-strike, Need for Speed, Football Superstars etc. Metrics on In-game Advertisements Nielsen, a leading provider of marketing information, is doing significant work in the field of developing metrics to collect user reach data. It has collaborated with major game publishers and ad networks and developed a Gameplay metrics for In-Game ads. The metrics provides advertisers with a greater level of precision to target their digital audience. Using Gameplay, ad agencies and game developers can have access to high quality demographic data to help in decision making on In-Game advertising. The illustration below shows the Nielsen metrics. Rank Prev Months Rank Game Title AA%* Avg of Minutes Played Per Week % of Total Minutes Played Per Week 1 1 World of Warcraft Halo: Combat Evolved Sims Halo RuneScape Madden NFL Warcraft III Warcraft Counter-Strike Grand Theft Auto Figure 4: Nielsen Game Play Metrics Top pc Games June 2007 * AA% is defined as: Percentage of all PC gamers who played a title at least once during the reporting period 5
7 Insights Marketers are facing two major challenges while considering any emerging advertising platforms, first to get the desired reach and second to engage the customer with effective medium. Consumers are spreading their media time across multiple platforms with the on demand content availability. In order to capture the audience attention and built strong brand association the marketer needs to discover innovative ways to reach out its target customer base. In-Game advertising provides an exciting opportunity for advertising in both online and offline mode. It has the potential to impact branding campaigns, promotions etc through effective medium along with desired reach. In US around 65% of households play computer or video games out of which about 22% of most frequent gamers pay to play online games. The user demographic study of the gamers reveals that only 26% of gamers were over 50 years of age which suites marketers wish to target young population for their products and services. According to PWC Global Media and Entertainment report the Internet and video gaming market segment is poised to register a growth rate of around 9% over 2007 to 11 which is much higher compared to other traditional from of media and entertainment. As more and more consumers incorporate gaming as a part of their digital life style marketers needs to consider In- Game advertising to engage target audience. At the same time they need to take prudent decisions based on the relevant analytics metrics to realize most out of their advertising spent. Analytics plays a major role as advertisers needs to closely follow the user activities to realize the ultimate goal of interacting with consumers in a non intrusive way with relevant offerings. According to one of the study carried out by American Advertising Federation, gaming came next to search engine marketing in terms of online media effectiveness. 10.0% 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% Print TV Radio Internat & Video Game Others Figure 5: US measured media market segment CAGR ( ) 6
8 Conclusion Consumers are increasingly adopting new channels for entrainment; brands currently spending on traditional medium are questioning the value of their spending. In-Game advertising will give marketers a new avenue to explore the potential of targeted ads, realizing a better RoI. One of the researches carried out by Gamasutra reveals the fact that already In-Game advertisers are experiencing an increase in brand recall by about 44%. Clearly In-Game offers an exciting platform to try out innovative ways of advertising. 7
9 Reference Forrester study on Why Game Marketing Matters Pub: 2007 Forrester study on Microsoft s Live Gaming Multiplatform Shift Pub: 2007 PWC study on Global Entertainment and Media Outlook: ESA Report on facts about computer and video game industry Pub: 2008 emarketer study on In-Game advertising Pub: February 2008 IGA Worldwide web site Massive world wide website Nielsen website Gamasutra website Marketing Charts website 8
10 About TCS Incubation Group The Incubation Group is TCS investment in the future, founded with the mission of Incubating and Sustaining Big Bets for TCS. The intent is to have a sustained, first-mover advantage and open new markets for TCS. The group nurtures ideas from Inception to Implementation. It is focused on creating innovative assets and solutions to achieve non-linear growth for TCS. The group is currently aiming to launch solutions and services in the areas of advertising ecosystem, mobile value-added services and digital devices. Working with partners, customers, telecom companies, advertising agencies and our innovation labs, it is carving a niche for TCS in the digital space. About Tata Consultancy Services (TCS) Tata Consultancy Services Limited is an IT services, business solutions and outsourcing organization that delivers real results to global businesses, ensuring a level of certainty no other firm can match. TCS offers a consulting-led, integrated portfolio of IT and ITenabled services delivered through its unique Global Network TM Delivery Model, recognized as the benchmark of excellence in software development. A part of the Tata Group, India's largest industrial conglomerate, TCS has over 100,000 of the world's best trained IT consultants in 50 countries. The company generated consolidated revenues of US $5.7 billion for fiscal year ended 31 March 2008 and is listed on the National Stock Exchange and Bombay Stock Exchange in India. For more information, visit us at incubation.group@tcs.com All content / information present here is the exclusive property of Tata Consultancy Services Limited (TCS). The content / information contained here is correct at the time of publishing. No material from here may be copied, modified, reproduced, republished, uploaded, transmitted, posted or distributed in any form without prior written permission from TCS. Unauthorized use of the content / information appearing here may violate copyright, trademark and other applicable laws, and could result in criminal or civil penalties. Copyright 2008 Tata Consultancy Services Limited
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