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Pandemic and programmatic push mobile gaming into a new era

by Julia Smith

14 December 2020 10:50am

By Niklas Bakos, co-founder and CEO, Adverty

How many of us have become gamers during the pandemic, without particularly planning to? There was no need to buy a console, or even necessarily a game - there it all was on your phone, offering to fill an idle hour or two. In many cases, there’s been a social element too - and in the most socially challenged year in living memory, that’s no small thing.

When all the numbers are in, global mobile game downloads are expected to increase by 35.7% year-on-year in 2020 to 57bn, up from 42bn in 2019 [source: GamesIndustry.biz]. And while people may play for shorter sessions when the pandemic eventually recedes and normal life resumes - maybe no more eight-hour marathons for a while - from where we stand now the gaming audience looks like it can only ever increase.

The boom in gaming is a phenomenon, and consoles are clearly a part of that too, as every Fortnite or Fifa fan knows. But while in-game has all the makings of a major media channel, mobile specifically is where the real action is - and that is why programmatic represents the only path forward into a sustainable in-game ad business.

Plenty of ad-tech companies are laying bets on the advertising market in PC and console gaming, and in some respects it is easy to see why - the ads look great and the best-known games are famous even among those who don’t play them.

However, there are also real problems down that path. Since programmatic isn’t really possible in the PC/console channel, every ad deal is a person-to-person sale involving advertising sales teams and media agencies. Compared to programmatic, where publishers can simply plug into the ad networks, the model is inherently cumbersome.

There is also a perception that the big wins in terms of reach are to be found in console gaming - perhaps because a handful of the most popular console games are household names. However, this is very easily debunked. Fortnite certainly has an amazing reach - partly because it comes in a mobile form as well - but such is the penetration of mobile that any mid-sized mobile game is easily bigger than the top ten console games.

Mobile as a gaming platform is growing faster than console or PC in terms of usage - in fact, it is now outpacing TV as the media platform of choice, as even big names such as Netflix show signs of viewer fatigue. And with incoming 5G networks promising console-quality graphics in your pocket, the gaming hardware business is experiencing a very interesting moment.

In the mobile advertising picture, other pieces are falling into place, strengthening the argument for mobile gaming as a media channel of exceptional promise. Networks like ours, for example, allow for both performance and branding ads. Our In-Play format lets advertisers to fit seamlessly into games, with brand awareness ads in virtual locations such as billboards; our new In-Menu format lets brands place contextually-relevant, performance-focused banner ads in between gameplay.

We have also worked hard to address issues around viewability, which, along with reach, is understandably the abiding obsession of digital advertisers. Here, there have historically been challenges, as an in-game environment is a very different one to a two-dimensional online banner experience, and the process of demonstrating exactly what a user sees far less straightforward. But we can now measure viewability, taking account of complex scenarios, 3D worlds and objects in motion - and in the US we have recently patented the algorithmic technology, known as BrainImpression, that facilitates that understanding.

There is work to be done in integrating gaming in the media consciousness with the other channels that make up the programmatic offering. But at this stage, the discrepancy between the size of the gaming audience and the scale of the advertising market is increasingly hard to justify.

More than 2.6bn consumers are now gamers. What’s more, gamers demonstrate significantly higher rates of engagement than TV viewers, while gaming’s demographic range is far broader in both age and gender mix than the prevailing stereotypes suggest. Yet ad investment in this category stands at only 5% of that claimed by social media.

In-game mobile advertising is standing on the cusp, and galloping growth and unarguable demographic shifts are conspiring to push it over. When the mainstream ad business lends just a little more of its weight, we’ll be looking at a quantum shift.

Tags

Adverty
gaming
in-game ads
In-game advertising
mobile gaming
Programmatic
programmatic advertising
Adtech
Digital Advertising
esports
Gaming Advertising