Published July 15
In 2020, video game giant Electronic Arts placed advertisements into its fighting game EA Sports UFC 4 during “replay” moments. Branding in sports video games wasn’t new, but it largely came in the form what you might see in real life, like signage in stadiums. Many gamers, however, viewed these new ads as intrusive pop-ups. The backlash was swift and fierce. EA promptly issued an apology and disabled the ads.
But EA is home to EA Sports franchises like Madden and College Football, making it ripe for innovation. Six years later, EA is once again trying to shake up its in-game advertising business.
The company recently announced EA Advertising, a new platform that, according to its press release, enables brands “to integrate directly into gameplay through dynamic, real-time placements.” It made sure to note that these were designed to “enhance, not disrupt, the player experience.”
Brands will now be able to refine messaging in real time, create custom integrations to reflect real-world sporting environments and accurately measure for the first time. In other words, that stadium signage, for instance, could now be much more targeted to the specific player.
EA likely sees plenty of potential for advertising in big-budget console games as a revenue driver. A Dentsu report last year found that there are 3.5 billion gamers worldwide, but that the sector only accounts for 5% of global ad spend.
Still, EA’s strategy raises several questions about the broader state of in-game advertising: Will this embolden other game publishers? Can ads like this work in non-sports games? And perhaps most importantly, what is the appetite from gamers for advertisements in the first place?
“The benefit for gamers, in a sports simulator, is authenticity,” Brent Koning, global head of gaming at Dentsu and a former EA executive, told The Current. “But when advertising adds friction for gamers, that’s when the yellow flags start getting raised.”
How gamers feel about advertising
According to Dentsu research provided by Koning, 66% of gamers feel positively about in-game brands — but many say the integration should make sense for — or be beneficial to — the game.
Further, 27% of gamers say they have clicked on in-game ads, 26% have searched for more information after seeing an ad and 22% have interacted with integrated branded content, according to Dentsu.
Other research reinforces this: Data provided to The Current by Comscore shows 34% of console gamers have searched for more information on a product after seeing it in a video game, up from 23% last year. And about 20% have purchased a product after seeing an ad in a game, up from 17% last year. The most likely age group to make purchases is 45-54-year-olds.
“The data challenges the perception that gaming is only a Gen Z channel,” said Brian Pugh, chief product officer at Comscore. “It shows that Gen X gamers are the most likely to convert after seeing an ad, while millennials also deliver strong purchase rates. That makes gaming an increasingly valuable environment for brands targeting consumers with significant buying power.”
Where gaming ad spend is going
The vast amount of in-game advertising spend in the U.S. is actually on mobile. EMarketer projects that the channel will surpass $8 billion in ad spend this year, while nonmobile will drive less than $1 billion — leaving plenty of room for growth for the latter.
“EA Advertising could help extend gaming ad opportunities into console and PC gaming environments where advertising tends to be less prevalent,” EMarketer analyst Marisa Jones wrote.
That said, console and PC gaming is typically a more focused and less casual experience than mobile gaming, making it more challenging for ads. As EA saw in 2020, gamers won’t want ads intruding on their narrative or gameplay.
Plus, consumers are paying full price for a game where they may still be served brand messaging (not including gaming platforms like Roblox, which is free to play aside for in-app purchases).
The typical price of a big-budget console game today is $70, up from $60 a few years ago. The upcoming Grand Theft Auto VI will be priced at $80.
Could advertising help alleviate those costs in the future? Koning believes this may be an opportunity.
“Consumers don’t mind being advertised to if a value exchange is there,” he said. “Companies need to find ways to bring costs down. Advertising might be the path forward.”
At least for now, though, that may not work for every type of game across every genre of gaming. In sports games, the branding is intentional. In narrative-driven games, it might feel out of place.
“EA is uniquely positioned because of their sports simulation games,” Koning said. “If they build an ad network, they could be successful in selling inventory. 2K Games [publisher of NBA 2K games and others] might be eligible too. The few that can do it will be successful.”