> Exploring In-Game Advertising: Ad Types, Targeting, Costs, Challenges

Video games aren’t just fun. They can be profitable for savvy advertisers looking to reach one of the most lucrative and elusive groups of consumers. In-game advertising merges ads with the game environment seamlessly, providing brands with incredible reach and powerful targeting capabilities. This guide covers the basics of in-game advertising, including common ad types, available targeting options, associated costs, challenges and best practices.

Types of in-game advertising

Before exploring how to take advantage of in-game advertisements, let’s review the most common types of game ads.

• Static in-game advertising: These ads are directly hardcoded into the game. Since the ads can’t be changed and will exist in the game ad infinitum, rates are expensive and charged on a fixed-fee basis.
• Dynamic in-game advertising: Dynamic ads can be replaced quickly and deployed instantly. These ads can appear in different places and formats (display and video ads are the most common). The 2008 billboards from Barack Obama in Need for Speed: Carbon are a great example of this ad format’s simple yet powerful use.
• Sponsored game content: Sponsored game content involves integrating a brand or product into the actual game content, making it even more tangible and visible to the player and engaging them with the brand. KFC did this exceptionally well when it partnered with Nintendo to create a virtual island in the popular game Animal Crossing: New Horizons.
• Advergames: These are games specifically designed to promote a brand or product. They provide a fun and engaging way to interact with a brand and can effectively build brand awareness and loyalty. An example of this is Chex Quest, made by Chex, which was the first video game ever to be included in cereal boxes as a prize.
• Product placement: The classic advertisement method still works. Advertisers can put their products directly into video games to guarantee players see the brand and “use” the products. An example of this is Mario Kart 8 on the Nintendo Wii where players can unlock Mercedes-Benz cars.

Targeting options for in-game advertising

The other unique benefit of in-game advertisements are the targeting abilities. It starts with choosing the right game (or games). Advertisers can focus on consumers based on demographics, geolocation, device type or platforms. However, integrating these traditional targeting approaches with behavioral targeting makes in-game advertisements even more effective.

Behavior targeting uses the actions the player has taken (or has not taken) to create an ideal segment of users to reach. For example, an advertiser could target players who have demonstrated a willingness to open their wallets by spending money to buy items in a game — or players who have reached a certain level and are, therefore, more engaged. Combining these different ways of targeting and deploying them across various games that reach consumers on multiple platforms (gaming consoles, computers and smartphones) makes in-game advertising extremely powerful.

How to buy in-game advertising

Getting started with in-game advertising will ultimately depend on the types of games you want to appear in and your budget. When selecting an approach to buying in-game advertising, consider the specific goals, budget and target audience of the campaign.

• Game publishers: You can work directly with game publishers to create custom ad campaigns within their games. This approach provides more control over the creative content and targeting and a deeper level of integration with the game environment, however, it can be more time-consuming and expensive than other options and may not offer as much scale or reach.
• In-game ad networks: Ad networks connect brands with multiple game publishers, providing access to a broader collection of games. They offer greater scale and reach and more efficient pricing and targeting options, however, you have less control over the creative content and placement.
• Programmatic advertising platforms: Programmatic platforms use data and algorithms to automate the buying and placement of in-game ads across multiple publishers and platforms. This approach can offer greater efficiency, scale and advanced targeting options based on user data and behavior, however, programmatic platforms may have less control over the creative content and placement and may require more technical expertise.