Why your ads need to get in the game

This year’s edition of our annual Global Entertainment & Media Outlook is the first to measure in-app games advertising and connected TV advertising, which are turning into a significant market. The scale and continued growth potential are plain to see: the metric topped US$54 billion in 2021 and will more than double by 2026. This can be chalked up partly to the fact that many of the largest and most sophisticated streamed-entertainment companies, faced with a decline in organic user growth, are abandoning a business model that’s based on subscriptions alone. Netflix, for one, is planning to launch an ad-supported offering this year. Across sectors, in fact, E&M businesses—not least of all in gaming—are finding ways to incorporate advertising and e-commerce, which are tightly linked.

Revenue always follows attention, and as attention moves to these emerging segments, CMOs in virtually every industry need to follow it, too, in order to establish a presence in these increasingly fertile digital environments. They can start by finding out how many members of their brand's target audience are regular gamers today and, crucially, how many are likely to be gamers in a few years’ time—and they should base current ad allocations and strategy on that future core audience in order to avoid falling behind the curve. Just as important, CMOs need to determine whether in-game marketing should be a small bet—say, a limited suite of in-game display ads—or a bigger bet, anchored in an immersive presence that’s intrinsic to the narrative or gameplay. Finally, they should make sure that at least a portion of ads are “shoppable,” meaning they offer users the opportunity to conveniently click (or talk) and purchase, creating a seamless connection to any e-commerce presence.