Introduction
In today’s world, advertising is more prominent than it has ever been before. We receive messages in every way possible: mobile phones, newspapers, periodicals, televisions, billboards, bus stops, and so many more ways. However, even with all the advancements to get advertising messages to consumers, there is ever more power in their hands to ‘opt-out’. Web browsers have ad-blockers which block banner and video ads on the internet, spam filters stop promotions from reaching emails, and digital video recorders (DVR) allow consumers to record TV programs, completely avoiding the time spent on advertisements during a live show. It is clear that traditional media practices are not cut out to reach today’s consumers. Advertising agencies are searching for ways to keep consumers engaged with their advertising messages. One avenue that has generated interest in the industry is to advertise and place products in entertainment programs, like movies and television. One area that has shown increasing popularity is the area of video games. Game publishers are seeking ways to include advertising messages and product placements in their games, and companies are looking to develop games themselves that promote their products or brand.
Decline of Traditional Media
It is no surprise that traditional media is in decline with the rise of digital media. In 2016, the online advertising market outpaced TV by roughly $15 billion. In fact by 2021, online advertising is projected to be worth $116 billion compared to TV projected to be worth only $75 billion. Overall, the projected growth of TV has decreased from previous years due to the decline in TV viewing. Magazine advertising is not growing, having stagnated in terms of growth, and digital advertising is projected to overtake print advertising as the leading source of consumer magazine advertising revenues in 2020. Unlike the magazine advertising industry, newspaper advertising has not had success in moving to digital advertising; the market is expected to decline almost $4 billion by 2021. These predictions show the trend that has been occurring since the early 2000s. Even in 2003, the president of Coca-Cola announced that the nation was moving away from television as the main medium in homes. They redistributed more than $300 million in annual advertising funding towards advertisement placement in television shows, movies, and videogames.
The Rise of Video Games
Accompanying the migration of advertising to digital medium has been the rise of the videogame industry. According to a report from the games research company EEDAR, 67 percent of Americans play video games, an audience which numbers 211 million people. These people spend an average of 12 hours a week playing games [3]. In the Asia-Pacific region alone there are an estimated 1 billion gamers [5]. Additionally, while many believe that games are only for kids or teenagers, 63% of gamers worldwide are 21-50 years old. Of the $116 billion spent on gaming in 2018, 35% of it will be spent on mobile, creating a huge market worldwide. These statistics point to a large market that will continue to grow in the next decade. And while the advertising industry has started to invest in game advertising, the question still remains; are video games a viable medium for modern advertising? This essay will attempt to answer that question by examining the use and effectiveness two major areas of advertising in video games: (1) Product Placement and In-game Advertising, (2) Advergames.
Description of In-game Advertising Techniques
The practice of product placement, a marketing technique where references to specific brands or products are incorporated into another work, can be dated back as far as the 19th century. Companies would requested to be placed or mentioned in famous works, like Jules Verne’s “Around the World in Eighty Days”, or in early film cinema. Product placement can be done for many different reasons: to reduce production costs or to receive compensation. There are two classifications inside these categories – “basic” and “advanced.” Basic placement is when a logo or product appears, but it is not the focus. Advanced placement is when actors or characters draw direct attention to the product or brand in question [13]. A third type, “advertisement placement”, is the placing of actual advertisements in media, like an ad for a car brand in a racing game.
In-game advertising (IGA) refers to any sort of advertising inside of video games. According to Forbes, spending on IGA was about $7.2 billion in 2016 alone. The earliest known example of IGA was in the 1978 computer game Adventureland, where developers inserted an advertisement for their next game. In the early 1980’s, IGA was included in Sega racing games featuring Marlboro billboards. Nowadays, IGA can be found in many of the same ways that ads manifest on the internet or that products are placed in movies or shows: banner ads, videos before content, watching ads for in-game rewards, or basic and advanced product placement. A prime example of this is in modern racing games, like Gran Turismo 5, where real-life cars and brands are the backbone of the game. Players choose, drive, and interact often with the cars on a regular basis. These interactions are often for much longer than your traditional 30-second TV spot.
Effectiveness of Product Placement
How effective is this kind of exposure for marketers? Car company Ford believes in the effectiveness of product placements. Ford digital marketing manager Brian McClary explained in a 2012 interview, “Playing a game isn’t as intimidating as having to walk in a dealership, speak to a salesman and talk numbers. It’s a great opportunity for us to talk to the public in an un-intimidating environment where they can do things on their own terms.” Games like Gran Turismo 5 or Need for Speed always include real statistics like horsepower, suspension, acceleration rates, and more, allowing the player to both see and experience what driving said cars might feel like in real life. At the same time, marketers also don’t want their products to be viewed in a negative connotation. While crashing in a racing game can be attributed to poor gameplay, Ford has restrictions against games purposely based off destruction or violence, like Burnout or Grand Theft Auto. The placement of these products happens on a two-way street. Game developers often request to license specific models like the Ford Mustang or other famous cars, and car companies like Ford will pay the developer to subsidize the inclusion of specific cars like the Ford Focus. According to Ford, these kinds of placements have extreme effectiveness. In a study conducted by Interpret, participants of an in-game Ford ad exposure saw a 36% increase in brand rating and 45% more gamers agreed that the Ford Focus was fun to drive.
An earlier 2009 study, The Effect of Product Placement in Computer Games on Brand Attitude and Recall, looked at the effect of a brand placement on groups of varying familiarity with the given brand. After the experiment, they found that participants with low prior knowledge to the brand showed a significant increase in their brand attitudes after their exposure to the brand during the computer game. Participants with high prior knowledge and those placed in a control group (another brand was seen during gameplay) did not show any significant increase or decrease in brand attitude. The research concludes that product placements in games may serve as a means of converting player attitudes towards an embedded product. These types of active product placements allow the consumers to interact with the product in a positive manner.
A New Form of Post-Advertising
This kind of interaction with the product is a great exhibition of post-advertising. In a time when it has never been easier to opt-out of advertising messages, “the only way to garner positive attention is to create content that is relevant, informing, and entertaining.” So what is the opinion of the consumer on the use of IGAs? Earlier studies seem to show that the a majority of players support more advertising and brand placement in games. Some common reasons that gamers support this practice are that it enhances the sense of realism (as in racing games like Gran Turismo) or that it would lead to lower development costs for game developers. Gamers were most concerned that product placement in a game would detract from the setting, like putting a car ad in a fantasy game.
So what is the best way to create “realistic” advertising for consumers? Currently, the most realistic setting is in that of sports games, which mirror a television broadcast and often have advertising quips whenever a player scores a goal or point. This can be seen in EA’s Madden football games, where Old Spice is mentioned regularly throughout the game, “This broadcast is brought to you by Old Spice Body Wash, Thanks for smelling great, man.”
A more recent service for mobile applications is Google’s AdMob Service. AdMob “helps you monetize your mobile app through in-app advertising. Ads can be displayed as banner, interstitial, video, or native ads – which are seamlessly added to platform native UI components.” The service is a prime example of dynamic advertising, which allows Google to serve up many different types of ads even after the game is published. Additionally, developers can aim to create a positive user experience with ads, matching the feel and look of ads to their app, as well as choosing advertisement categories so that the marketing feels related to the app.
Advergames
In short, advergames refer to any sort of online or offline game that incorporates marketing content. In earlier versions, advergames merely featured the brands or logos of the funding company in the virtual environment of the digital game. This static form was fairly ineffective [6], as players are engaged by the active portion of the game and never acknowledge the brand image in the background. This has encouraged corporations to create their own advergames, where the brand or character related to the brand could relate directly to the theme of the game and play an active role. Today, advergames come it one of two forms: The older Flash-based web advergame, and the newer interactive (and often hybrid) HTML5 or mobile based advergame. Typically, these games are available for free (as noone wants to pay for an advertisement), and they will have some viral marketing dimension. The older Flash-based games can be found for many different companies, often those with children their audience. Club Kellogg’s, Kellogg’s game site features almost 25 games with various names like “Frosted Flakes Ball Hockey Game” or “Froot Loops Space Game.” These games usually feature simple mechanics like digital air-hockey or Space Invaders, but with Kellogg’s mascots as the main characters [9]. As with any sort of brand advertising, these advergames must stay aligned with the brand’s goals, values, and image.
Advergame Characteristics and Personality
A study on advergames done at the Montpellier Business School lists six characteristics that an efficient advergame must have [7]:
Accessibility: The easier it is to get access and quickly play the game, the more likely it is to reach its audience.
Ease of Understanding: The easier that people of all skill levels and ages can pick up on instructions and rules, the better.
Competitive Level: An advergame has to keep players wanting to play more. This can include leaderboards, achievements, or levels of difficulty.
Relevance to the brand: The advergame has to have strong association to the brand advertised, and the elements must be clear in the game.
Capacity to induce and maintain a state of flow: If the advergame is engaging and players get sucked into playing it, they will be exposed to the brand for longer.
Viral marketing: The game should encourage sharing with other people, virally expanding its reach as more people share the game.
These attributes are all a function of what becomes an advergame personality. A study from 2016 aimed to explore the dimensions of advergame personality and to produce insight into their effectiveness [10]. They found that players ascribe personalities to advergames and that these personalities are not only related to companies’ attributes but also affect players’ intentions to play advergames and purchase products. It does matter, however, how congruous the brand is with the game in question.
Another study from 2010 looked at the effects of game-product congruity on brand memory and game attitudes for a low-involvement product. While the advergames were an effective tool for driving brand awareness, there was a distinct difference in explicit memory of games that were highly congruous with the brand. This had the consequence of also having more negative attitudes towards the advergame in the congruent games as compared to the incongruent ones. When the brand was played an active role in the game, players “readily enacted their cognitive defenses and responded critically when evaluating the game because it was perceived as an ad for Oreo.” This see-saw of superior memory effects with more negative opinions and inferior memory of the sponsoring brand with greater of enjoyment shows that advergames are a balancing act of attitudes and memory.
Conclusion
The world of digital gaming is continuing to grow and change. Apple has just released ARKit 2 for iOS and the prices of VR headsets are steadily falling as the technology advances. The opportunity for game developers to create games that integrate with our surroundings or to immerse gamers in new virtual worlds is that much easier. With these opportunities, the ability to advertise in new ways, augmented reality advertisements as we walk down the street, interacting with products in VR, etc. is pushing the boundaries for what is considered a medium for advertising.
Currently, there is a narrow balance between gamers, developers, and advertisers. While there are advertising methods that gamers do not like, there has been no uprising against in-game advertising. Developers work with advertising agencies to create appropriate advertising in their games. As long as they do not go too far, there will not be a revolt against advertising like on the web, where ad-blockers have become ubiquitous. Studies and real-world examples have shown that the right mix of advertisement and game can lead to great success (e.g. The Scarecrow by Chipotle). Product placement and in-game advertising is proven to have real effects on consumers, increasing brand awareness and changing attitudes. Videogames are proven to be a viable medium for advertising that will continue to grow in the future.
What comes across as most important is making sure that using videogames as a medium stays in line with the rest of a company’s brand stream, where advertisements in video games can point back to digital media and vice versa. The advertisements just also stay in line with the setting and theme of the games they live within. Without this, advergames will fail and IGA will receive backlash. Noone wants to see Reeboks on the next Call of Duty character. But as long as advertising agencies and game developers work to create advertisements and games that do not leave out the desires of the consumer, video games will remain a medium for advertising for many years to come.
