Video games, the next venue of advertising

In an age of information overload and overexposure, advertisers are constantly trying to find ways to connect and reach out to its target consumers. The accessibility and volume of information available to the general public allow advertisers to flood consumers with advertisements at any given time and place. In additional to advertisements in traditional media like television and print, advertisers have gravitated towards advertising in other mediums.

In 2008, the highly anticipated video game Grand Theft Auto IV grabbed the world’s attention when it broke the record for the most successful entertainment release in history. Within 24 hours, Grand Theft Auto IV grossed $310 million dollars worldwide. In comparison, the most successful book release, Harry Potter & The Deathly Hallows, grossed $220 million and the most successful film, Spider-Man 3, grossed $117 million within the same time. In fact, the video game industry has been growing at an alarming rate in the past few years. In the past five years, the video game industry has been growing 28% annually, while the movie and music industry lags behind with 1.8% and -10.0% growth rates respectfully. As of 2009, the video game industry is estimated to be worth $10.5 billion dollars in revenue. The video game industry was an untapped goldmine, and was simply too large and profitable for advertisers to ignore.

Advertisers now have developed several ways to communicate their marketing messages in video games. Product placement is a widespread method advertisers often use to advertise their products. For example, Metal Gear Solid 4 features various Apple products such as laptops and desktop computers, as well as an in-game iPod. In addition, all the cars in the video game Tom Clancy’s Rainbow Six: Vegas 2 are manufactured by Dodge. Another way for advertisers to subtly insert advertisements into video games is virtual billboards. In the video game Second Life, the billboards in the virtual city includes virtual billboards for Sony BMG. In fact, prior to the presidential election in 2008, the Barack Obama campaign paid for in-game virtual billboards in another video game Burnout Paradise. In-game sponsorships are extremely popular in sports games. Emulating sponsorships in real sports, advertisers often use brands to sponsor certain events in video games, like the “Sprite Slam Cam” in NBA 2K11.

Advertisers are constantly trying to explore options to find out how to embed their messages in video games without letting the consumers realize that they are being sold to. In traditional advertising mediums like television, the consumers are comfortable with and accept commercials as a part of the viewing experience. However, it’s different for video games. Console games usually cost around 45 dollars, and gamers may not feel comfortable for having obvious commercials in their purchased products. The exception may be games like sport games, in which the sponsorships in-game emulate that of real life presentation on television and on street. Although the video game industry is large and growing, advertisers have to be careful about how they advertise their products and brands.

This entry was posted in Uncategorized. Bookmark the permalink.

4 Responses to Video games, the next venue of advertising

  1. Jessica says:

    Awesome post! Although I had never heard of product placement in video games like this, it totally makes sense. Advertisers have the ability to tap into this audience for literally hours at a time. I was most surprised to hear about the Obama campaign’s marketing efforts in this realm…talk about thinking outside the box!

  2. shotlowr says:

    I’ve been interested in how advertising has been developing in video games. The great advantage for advertisers is that in many instances product placement adds to the perceived realism in game play. We encounter advertisements in our day to day world…why shouldn’t this be replicated in the virtual world? I think it will be especially interesting to see how advertisers navigate permeating video games in a way that doesn’t compromise the virtual space…

  3. Jacqueline says:

    Being an inner “closet” geek that actually enjoys playing video games (sometimes even to an obsessive state… Dota/League of Legends anyone?) I’m also currently taking a class about the video games industry, and how it has changed since the original ATARI game (CMGT 537 is anybody is interested). Our professor also purchased admission tickets for us to the Gamer’s Developer Conference in San Francisco earlier in March, and also was able to get us permission to tour the EA (Electronic Arts) office in Culver City area.

    We were fortunate enough to have the marketing director for the XBOX CALL OF DUTY speak with us, and he talked to us about how product placement for the game worked. While the latest Call of Duty game focused on providing the gamers a VERY virtually realistic gaming experience, they found products/bands that fit into their design, and not the other way around. For example, while they were interviewing actual “Black Ops” force members, they designed the character to look VERY SIMILAR to the military members. A very specific pair of sunglasses was designed into the game to the very last T (Oakleys). They also invited Linken Park to debut their latest track in the game. Linken Park has always claim themselves to be die-hard fans of Call of Duty. Linken Park used scenes of the game as their music video for their hit track, and it generated lots of buzz for both the band and the game itself.

  4. mooread says:

    This integration of advertising and entertainment is the growing avenue for companies. Starting with basic product placement, we are now in the age where reality television shows are based around products (Top Chef), movies heavily feature one company (The Italian Job) and even songs (Ke$sha) will talk of certain products. The reason this is working so well? It is impossible to avoid these marketing efforts.

    Because we are now used to being able to skip advertisements, these tactics are perfect for targeting audiences. Each video game produced has an intended market, and if companies can reach these people directly, it is incredibly beneficial. However, will consumers ever reach a threshold for advertisers, like with what we’re experiencing in online video today, and if so, what will that mean for the marketing game?