Gaming advertising in your media plan.
24th January 2024 by David Fenlon
Gaming audiences, stereotypes vs. reality
In the world of advertising, “gaming” has recently become an area of interest for brands although there is little information that is readily available for them. This is reflected in the most recent Cannes Lions festival – there were only a handful of presentations / panels on gaming, and only one in the entire festival on esports (competitive video gaming). Progress has been made with the creation of a new “gaming” advertising award, but there have been very little educational materials shared with budget holders on what this category brings to the table. Consequently, there is little understanding of the landscape and few budgets have flowed to this advertising area.
This is a mistake. Gaming is not a niche area anymore and the perceptions of audience profiles are woefully inaccurate. This is hardly surprising: everything we have been told about “gamers” is simply incorrect. Consequently, advertisers brush over this audience and the potential opportunities associated with it – but this is a big brewing problem for brands and agencies alike. How wildly different the perception vs. the reality can be is demonstrated in the table below:
The average age of a gamer is between 32 – 36 with 52% being female1
An entire vertical of society is being missed and the messaging might be alienating the underlying audience
There are over 2bn gamers worldwide and this is growing2
This is a mainstream media and needs a mainstream sized budget associated with it
When marketed to in a relevant way, engagement rates for gamers are over 2x that of social media advertising3
A nuanced interaction with audiences could result in double digit growth
Gamers have 25% more spending power than an English Premier League fan and 5% more than an entire “NFL” household – and this disparity is growing in favour of the gamer4
This is a premium audience to sell to, who have both the disposable income and the willingness to pay for higher value / higher margin products
The demographic difference outline above is shocking enough in itself, but doesn’t quite reveal the whole picture. Gamers continue to age gradually into their later 30s, but this is not due to younger generations dropping off in interest. If anything, it is the opposite. Generation Alpha (those up to 13) have decided to forego social media entirely, as all their social needs are met by gaming and the community tends to be significantly less toxic than social media platforms can be. The fact that gamers are still “aging” means that the category is drawing in much older audiences as well whilst, crucially, retaining their existing audiences. This is an enormous shift in the media landscape, and the future of brand advertising is tied up in it if the current behavior of younger generations is anything to go by.
Why gaming matters and how to be lucrative in the market.
48% - 55% of audiences under the age of 40 using ad blockers. They are also moving into walled gardens / echo chambers where advertising is not possible, or simply scrolled over. Gaming and its components represent one of the few areas that brands can advertise to these consumers in an effective way. It has become increasingly accessible due to the advances in technology, especially via mobile; and is significantly more engaging that most tradition forms of media. Its variety and rich content base also provides great flexibility in the message being delivered allowing brands to cut through to audiences. This combined with the digital community nature of the audience means that reactions to successful campaigns are much quicker than traditional campaigns and much more lucrative.
Gaming audiences spend big and can react rapidly to campaigns that are still highly cost-effective
Consequently, “niche” messages can be scaled over huge audiences and can be considered authentic. Take Gucci for instance. Through a progressive set of campaigns from brand insertion inot Minecraft to advertising via Fnatic (a premier esports team) and partnering with the esports tournament operator FACEIT, Gucci is now the most widely recognized fashion brand in gaming.7 Commercially, this has meant that Gucci has been able to sell gaming related products at a much higher price and at monster margins – their Fnatic branded watch sold for $1,600,8 and their Gucci Xbox sold out at $10,000 each before they even got to market.9 Gucci simply would not have been able to take on such a dominant position in traditional areas of advertising, nor could they demand such high prices.
More modest campaigns can also result in impressive results. DXRacer, a gaming chair brand, recently got over 20x times the media value of their spend when sponsoring the Bali DOTA 2 major, and the Indonesian Minister for Sport posted on their instragram a picture of the chairs now being a mainstay in his office.10 You couldn’t get that sort of exposure in most other media regardless of budget size.
Why is now a good time?
Despite a few notable campaigns, the landscape is relatively untouched by brands and advertising. This means that cut-through of message to audiences is extremely high for those who are advertising, and the number of novel and innovative options open to brands is large. Equally, the cost of advertising in this area is a small fraction of the equivalent on Paid Social or traditional sporting sponsorships.
However, this is changing. Fashion, apparel, automotive and FMCG brands and their agencies are starting to take this media seriously. They are hiring gaming roles, and they are gradually diverting more and more budgets to this area. The plus side of this is that many of the potential pitfalls that brands encounter have been identified and mitigated by the trail blazers. Against this backdrop, brands have an enormous opportunity to gain double digit growth if they can mobilize quickly and effectively into this area. Those who don’t will either have to pay an enormous premium in years to come or be left behind by their competitors, closed out of the next generation of customers.