Four reasons why gaming should be a key channel for all media buyers

Ads are nothing new to gaming and according to InMobi, “gaming apps consistently show the highest viewability and completion rates compared to other app categories”. So the reason they get treated it differently must be something other than availability or media quality.

I believe gaming doesn’t get the proper acknowledgment within media strategy because it’s often still viewed as a “niche activity,” and there seems to be a general gap in understanding around the unique dynamics of the medium. With that in mind, here are four reasons gaming should be a key channel for your media and marketing strategy.

Gaming ≠ ‘Niche’

Today, gaming is far from a niche. Games account for approximately one in every four app downloads, and 76% of global app revenues across all categories.

The audience for gaming is also increasingly diverse. The demographic composition of the mobile gamer audience - the largest audience in gaming – stands in stark contrast to stereotypical image of young, male gamers.

Instead, the current mobile gamer audience is majority female (55%) across a wide range of ages, with 47% aged 25 – 44 and 32% aged 45+.

It is geared to attention by default

Unlike news media, user-generated content video or radio, which are usually geared towards short engagement at high frequency, game-based experiences are designed to retain people’s attention across extended periods of time. Like Jim Brown, the senior designer at Epic Games says: “game systems are specifically designed to affect the player over long periods. As time goes on, the systems can affect player emotion and that can affect behavior”.

The short engagements found in most digital media are often designed to drive impression volumes, which aren’t a good measure of ad effectiveness or capturing an audience’s attention. Comparatively, gaming provides a much better foundation for quality attention and effectiveness because they are designed to retain players with a variety of gameplay techniques. Value exchange ads (or “rewarded ads”) are a common technique and a great example of the convergence of player retention strategies and ad effectiveness.

The IAB describes value exchange ads as “premium ads that offer consumers something of value in exchange for their attention.” Pioneered in the gaming sector, those ads may already be familiar to you. These are the formats where a user agrees to watch an ad in exchange for an in-game asset, like an extra life or some form of currency.

This style of ad makes major strides towards creating a better and more direct relationship between advertisers and audiences by making the value proposition more transparent and tangible to the audience (i.e. watch this, get this). And because this exchange continues throughout the lifespan of gameplay, greater retention leads to more rewards for the audience, advertiser and developer. As Brown also says, “the more you come back the better you become”.

Conversely, ads (rewarded or otherwise) that detract from gameplay may result in poorer player experiences that decrease retention. The flow on effect of this would reduce the amount of time spent in the game, the amount of ad opportunities, the advertiser’s exposure to the audience and the monetization opportunities for the developer. So advertisers and developers are incentivised - perhaps as much as players - to make all ad experiences positive and engaging for the audience.

Streaming is growing in audience and appeal

Gaming is also designed to be an inherently social experience – whether that’s IRL or online. This creates a number of extensions to gaming’s media footprint that amplify engagement and retention, while also offering marketers channels beyond in-game ads to reach their audiences.

Streaming is possibly the largest extension of the gaming experience, and 2018 was its biggest year on record. On average, Twitch had over one million concurrent viewers throughout 2018, and total viewing time topped 47 billion minutes per month, which is more than a 50% increase on the previous year.

Live streaming on gaming-focused platforms like Twitch is also expanding to other types of content, like cooking, beauty and performing arts, all of which been gaining popularity within the gaming and streaming communities. This diversification of content provides brands with products or services not traditionally aligned with gaming to become relevant to gaming audiences in new ways.

eSports are huge but largely untapped

The growth of eSports streaming has also been significantly increasing its hold over other streaming categories. The IAB found earlier this year that 40% of live streaming viewers in APAC are tuning in to watch gaming sessions or eSports, more than talk shows (31%), celebrities and influencers (30%) and even sporting games/matches (28%).

As a testament to the growth in eSports, viewership records were shattered in 2018. At the peak, the DOTA 2 International drew 14.96 million concurrent viewers. Similarly, the competitive Grand Final for Overwatch drew 10.8m viewers. By contrast, the record-holding Game of Thrones season 7 finale – “The Dragon and the Wolf” – drew 16.5m viewers across TV and streaming apps.

However, global eSports advertising doesn’t seem to be growing in parallel yet. Advertising (US$163m) and sponsorship (US$277m) revenues only represent less than half of one percent of global worldwide digital ad spend.

With eSports properties garnering a similar cultural magnitude as franchises like Game of Thrones, it’s surprising that demand and revenue haven’t followed suit yet. This suggests that eSports may be a largely untapped market for advertisers looking to get high-quality inventory without the upward pressures on pricing that often come when supply is limited and demand hits saturation.

The points above demonstrate that gaming is a media channel with lower demand, high supply, high quality, and a large audience, as well as unique dynamics that benefit both advertisers and consumers. When developing your next media or marketing strategy, carve out a section for gaming and start thinking about how the gaming experience can make sense for your brand.

Dave Goodfellow is the partnerships manager for JAPAC of Oracle Data Cloud. He is also an IAB South East Asia and India (IAB SEA+India) regional board member.