Exploring the possibilities of Videogames as an advertising platform
By: Adrian Castillo Perez Date: 27/05/2009
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Content Page
Preface p.3 1. Introduction p.4 1.1Hypothesis p.4 1.2What is this thesis about? P.4 1.3What benefits can come from this thesis? P.6 1.4Sub-questions p.7 1.5Research methodology p.7
2. The video game industry p.8 2.1History of the videogame industry p.8 2.2Present state of the videogame industry p.11 2.3Current struggles of the industry p.16 2.4Why is the videogame industry so important? P.19
3. Advertising industry p.21 3.1History of advertising p.21 3.2What makes an effective advertisement? P.24 3.3Brief look at the present state of advertising and why it needs to explore new mediums p.27 3.4Stake holders p.36
4. Videogames as an advertising vehicle p.39 4.1Understanding videogames as a medium p.39 4.2What separates videogames from other forms of media p.44 4.3What has held back advertisers from this medium? P.49
5. Possibilities of advertising in videogames p.51 5.1Gamer types and how their consumer behavior varies p.51 5.2Game types and how they relate to target groups p.54 5.3Different advertising models within videogames p.61 5.3.1In-game: Integrated ads p.62 5.3.2In-game: Passive and dynamic ads p.65 5.3.3Advergames: physical and online distribution p.67 5.4Alternative ways advertising could be used within the models p.69 5.5Requirements and advice for advertisers considering this medium p.73 5.6The possible resistance to advertising in videogames p.78 5.7The future of advertising in videogames p.81
6. Conclusion p.83 6.1Re-evaluation of my hypothesis p.83 6.2The contributions of my thesis p.84 Appendix p.85 - Questionnaires p.85 - Advantages and disadvantages for advertising within games p.94 - Bibliography p.97
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Preface
This document is a thesis created as part of my graduation on ‘international communication management’. I took the opportunity to use my knowledge and expertise to shed new light on a topic that has largely gone unnoticed, an area in advertising that greatly needs more attention and research: Advertising using videogames.
The thesis was written for anyone in advertising or simply interested in the topic of new media, alternative solutions and future trends. The purpose of this document is to present the reader with information on why advertising needs to explore new means of communication and presents videogames as a possible effective medium.
It is not intended to dictate how advertisement should be done, or as an analysis on the problems the advertisement industry is facing. This document explores a potential solution: videogames, it looks into all necessary areas an advertiser would be interested in and need to consider to then come to a conclusion on this new medium.
This thesis is being written during the growing stages of the videogame industry, many things will change, regulations and negotiations will take place to solidify cost models and fix advertising concepts. One of the reasons for writing the thesis at this current time is because it is a largely untested and non-standardised media with the potential for advertising. This document paints a picture of the current situation and possibilities, by the end the reader or advertiser should be able to take the information and verify what the potential of this industry is as an advertisement platform.
This can be regarded as an investigation into the possible cooperation between the advertising industry and videogame industry, and whether or not it would be an effective unity.
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1. Introduction
This chapter presents the definitions for this thesis. It introduces the reasoning for this thesis. The following questions are answered within the following pages:
- Why this subject area? - What benefits can come from this thesis? - What is my hypothesis? - What sub questions will be answered in this document? - What research methodology is used?
1.1 Hypothesis
The hypothesis for this thesis is:
“Videogames as a platform could become one of the most effective forms for advertising”
By the end of this thesis enough information and analyses is presented to either support or nullify this initial claim. 1.2 What is this thesis about?
“Games are becoming as viable an advertising medium as television” and other forms of media ever were, “it just took a while for marketers to come around”. 1
This thesis delves into the largely un-discussed area of advertising in videogames. Advertising and videogames are two industries that have finally grown and expanded enough to benefit from each other.
This thesis essentially discusses the possibilities of advertising in videogames and whether videogames can hold themselves as an advertisement platform as other mediums have, such as: T.V, Radio and print media. The videogame industry is growing at an unprecedented rate (even in difficult economic times); while other forms of entertainment industries are struggling. Furthermore and perhaps most interestingly, there is incredible untapped potential within the videogame industry, a young and flexible industry. This thesis covers such potentials and whether or not videogames are actually an efficient form of advertising. There have been attempts in the past where marketers have attempted to reach their audiences through videogames. However due to the very narrow target groups found 30 years ago when videogames emerged, and the technological drawbacks, advertisers have not been able to truly explore the potential of this medium. Finally the videogame industry has become a culturally accepted medium, especially considering that the current populous generation (18- 35 years old) and the future generations (0-18 years old) have all grown up exposed to or participating in gaming.
1 (David Edery, Ethan Mollick 2008, Changing the game . p.37)
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This area is of great personal interest to me simply because as a gamer and communications student I have seen tremendous possibility for videogames and advertisements to function effectively in synergy. This thesis has given me the chance to finally indulge myself and research whether or not these speculations are indeed true or just mere speculation.
Chapter 2 The first chapter of this thesis acts as an introduction to the gaming industry and the impact they have both culturally and in a business sense.
The chapter starts by briefly presenting the history of videogames and how they came about; this allows the reader to see how in a mere number of years an industry giant developed. The next subchapter discusses the current generation of video gaming platforms; this is incredibly relevant and important because these platforms are what potential advertisers would be using to connect with their target groups. A look at how important and relevant the videogame industry is follows. The focus on this area is how videogames have impacted the entertainment industry and its markets (consumers
Chapter 3 The following chapter focuses on advertising; very much like the previous chapter discussed. A brief look at the history of advertising is presented followed by a look at the current state of advertising in media and why new areas need to be explored by advertisers. An explanation and look into what makes a good advertisement is discussed, this acts as a control to why or if advertising could be effective as videogames. By presenting an agreement of what makes a good advertisement the reader can easily compare as to how other media compare to video games as a platform. Finally the chapter concludes by referring to both industries as a stake holders based on my hypothesis; this area covers who would be/is affected by advertising in games.
Chapter 4 These subchapters focus on superficial areas. ‘Understanding videogames’ helps the reader understand how this creative entertainment form functions as to visualize how advertisements could be implemented and function in synergy. Furthermore ‘how videogames separate from other forms of media’ takes into consideration what separates this medium from the rest as to further expose why videogames make such an interesting communicative vehicle. The chapter finalizes by touching on the reasons why it has taken so long for advertisers to tap into this medium.
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Chapter 5 Chapter 5 represents the main analyses of this thesis. It takes into consideration all areas of interest needed to understand the possibilities, the grey areas, advantages and disadvantages and what the future may hold for this new form of advertising. By this point the reader has a good understanding on videogames and advertiser’s need to explore. This chapter grants the reader the theory and logical reasoning needed to approve or disapprove my hypothesis.
The chapter begins by segmenting videogames by their markets and target groups followed by the clearly defined methods that advertisers could use to advertise.
The chapter then focuses on the potential factors that could affect an advertisers decision, these are; ‘requirements’, ‘potential resistance’ and concluding with a look at the predicted future for this topic.
Chapter 6 The final chapter of this thesis acts as a conclusion. It summarizes the findings, reevaluates my hypothesis and finally expresses what benefits this document has brought.
1.3 What benefits can come from this thesis?
There has been previous research done in this area, and such research will be used in my thesis. However said research is surprisingly scarce and more often than not outdated. Other times the research simply focuses on specific issues around the topic in question.
My thesis brings an up to date look at this new phenomenon of advertising, it objectively looks into the potential, possibilities and drawbacks for this method of advertising. Moreover whereas there are literally thousands of books about advertising, marketing and promotions, finding literature on this specific subject is incredibly rare. A report that documents the subject of advertising within videogames in a neutral and up to date manner is at this moment a very unique document. Considering the recent changes to the videogame industry, consumer’s behaviour and the state of the advertisement industry this would be precisely the right time to produce a document such as this one.
Slowly over the past couple of years games have shown their presence in our culture like never before. People are paying less attention to their televisions and newspapers, instead focusing on digital media; the internet and videogames. People from all ages are spending more and more time playing games, be it at home on their Pc’s, consoles or on their handhelds while on the move.2 Games are more prominent than ever and are now culturally accepted by the vast majority. Advertisers have noticed this and are doing their best to understand what is considered ‘a new medium’ to the marketing mix.
2 (Marolf 2006, Advergaming and in-game advertising. p.6)
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1.4 Sub-questions
Other questions answered in this thesis:
- Who and how would other media be affected by an increase in videogame advertisements? - What is the current state of both stakeholders (videogames, advertisers)? - Why is the videogame industry important? - What makes effective advertising? - What separates videogames from other forms of media? - What are the current potential target groups in videogames? - What models can be used to advertise within videogames? - What resistance or negative impact can arise from advertising within videogames? - What are the advantages and disadvantages of using videogames as an advertisement platform? - What is the predictable future for videogame advertising?
1.5 Research Methodology
Several standard research techniques are used within this document; namely, primary and secondary research.
Secondary research This provides the abundant information needed to investigate my hypothesis. Literature ranging from small investigative documents to known and accepted authors is used to represent a wide array of information and not fall into the trap of biased information. The literature used is limited to the amount of information available (little is available on the subject at hand) and the time to complete this document (little over six weeks), nevertheless it has provided more than enough information to present a solid and objective report.
Primary research This comes in the form of first hand investigation such as taking time to first hand play games with current advertising or potential advertisements as well as interviewing an enthusiast gamer ‘Martijn Wieriks’, a casual gamer ‘Muriel Philippi’ and a professional advergaming agency ‘Little chicken’.
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2. The video game industry
Before starting this chapter it is important to point out that this thesis is about ‘videogames’ and not ‘games’. Videogames require some sort of monitor/display for playing such as a TV screen or PC monitor; furthermore they require software to emulate the entertainment. Games on the other hand can be anything from Monopoly to poker. It is important to differentiate these types of games simply because they are different industries altogether and confusion has arisen in the past.
2.1History of the videogame industry
This thesis begins by introducing the reader to the story and evolution of the videogame industry. Comprehending the journey that the industry had to take to achieve its current success, I believe gives an interesting and humble introduction to this thesis. Furthermore by showcasing what videogames have achieved in a mere 30 years, and introducing the key events in its history, it provides a great segway to the next subchapter: “Present state of the videogame industry”.
The early years Everything started in the mid 60’s precisely 1966. Ironically as with most major communicative media such as Television, Radio and the internet, the founding ideas of videogames came from military projects. It was Ralph Baer an engineer for the US army who one day realized that Televisions could be used for more than simply watching. He wrote a four paper document that was to become the ‘magna Carta’ for video games 3
It was not until 1971 however that the first videogame company was born: ‘Nutting’. The company experimented making games and selling them in different formats. The company found it extremely difficult to market their products, furthermore even when they found a distributor willing to sell them, no one would buy them. It was not until 1973 that an employee of ‘Nutting’, Mr. Bushnell realized what the problem was; these games they were making were too difficult to play and too expensive. 4 He leaves the company to program his own games with colleague Al Alcorn.
Several months later Bushnell starts his own company ‘Atari’. ‘Pong’ is created, a simple tennis simulation game, easy to program and easy to play. Unfortunately for Bushnell no one wanted to distribute or market his new game, therefore he decides to market it himself. As part of an experiment Bushnell and Alcorn decide to place an arcade version of ‘Pong’ in a local bar, just to see how people would take to it. The cabinet had no instructions, just a coin slot. Several days later however, Bushnell Figure 1 Pong, the first arcade machine received an alarming call from the bar owner “I got a phone call in the
3 (www.msnbc.msn.com/id/15734058, 2006 history of videogames) 4 (www.gamespot.com/historyofvideogames , 2002 history of videogames)
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Bushnell and Alcorn rushed to the scene just to find that the problem didn’t lay within the machine…it was due to coins overflowing in the machine. ‘Pong’ was a success, and hence videogames became a successful entertainment form in the US. 5
The golden age After the success of ‘Pong’ Videogame companies began to flourish worldwide, namely in the US and Japan. Companies such as Nintendo and Midway created strong footholds in the market; Midway simply imported games from Asia to the US. Incidentally around 1978 Midway brings Space invaders, proving to be a huge success and breaking all sales records for that time, so much so that it causes coin shortages in the countries where it was released. 6
In 1981 two very important milestones are achieved, first of all the US army creates its own videogame to train its soldiers and Pac-man is created by Namco; the most popular arcade game of all time, selling over 300,000 copies (not counting pirated) to homes. Again a game created by accident when president of Namco took his team out to eat Pizza; “somebody had taken a first slice of pizza. And then he looked down, and there was ‘Pacman’ staring at him.” 7
To put the success of ‘Pacman’ and other games into perspective, in the US alone arcade games created revenue of $5 billion, with Americans spending over 75,000 hours playing arcade machines.
As the reader can see, within a mere 10 years Videogames went from a failed experiment to a billion dollar industry.
Unfortunately this success lead to a period where there where far too many products and companies in the market, churning out games, arcades and home consoles. This ultimately led to low quality and over saturation. Many companies went bankrupt and games lost their value temporarily.
Road to the present Between the mid 80’s and early 90’s ‘Nintendo’ and ‘Sega’ conquered the market. ‘Nintendo’ in particular was outselling its competitors 10-1. 8 During this time ‘Nintendo’ released the ‘NES’ and ‘Gameboy’ both being huge successes selling over 38 million units each in 3 years; Tetris being the main reason for the ‘Gameboy’s’ success, again a very simple game. ‘Nintendo’ enjoyed huge success until the mid 90’s when Sony introduced its ‘Playstation’, a machine far ahead of its competitors and positioned at a very reasonable price.
Experts will argue as to what started the current road of the videogame industry. However it was when the ‘Playstation’ was introduced that the industry dramatically changed. Whereas in the 70’s and 80’s every game publisher was creating their own arcades and consoles, by the
5 (www.gamespot.com/historyofvideogames , 2002 history of videogames) 6 (www.pbs.org/kcts/videogamerevolution , 2005 the videogame revolution) 7 (www.msnbc.msn.com/id/15734058, 2006 history of videogames) 8 (www.gamespot.com/historyofvideogames , 2002 history of videogames)
~ 9 ~ mid 90’s and up until now, there are only three hardware companies; Nintendo, Sony and Microsoft.
The ‘Playstation’ introduced incredible technology at the time, such as cd’s, graphics that blurred reality and for the first time the possibility of storytelling. Games were not simple characters anymore on a 2-d (two dimensions) backdrop. They were now 3-d (three dimensions), game makers could create worlds, in rich detail. ‘Nintendo’ quickly followed by introducing the ‘Nintendo’ 64 in 1996. Up until this date Nintendo and Sony have both marketed themselves to different target groups; Nintendo focuses on more casual and family oriented games while Sony produces more mature titles and dramatic games. 9
Relating this chapter to the hypothesis, it is because of the introduction of these new machines that advertising in games was finally a possibility. Marketers finally had the chance to place their brands in modern games (sport titles, driving titles mainly), most importantly not only where there more possibilities but the graphics where good enough for a player to identify the brand.
Any company that tried to introduce a new system failed rapidly, the market leaders where very established and no competition has been able to function since the mid 90’s (until now 2009).
The ‘Playstation 2’ and ‘Nintendo Gamecube’ where introduced in 2000 and 2001, further implementing technology, with ‘Microsoft’ introducing their first console ever the ‘Xbox’ in 2002. It was during this generation that games truly started being accepted. Games were everywhere, the new generation was born with videogames around and the players from the 70’s and 80’s simply kept up with the times. The ‘Playstation 2' as of 2008 has sold 140 million units (each costing $300 +/-) worldwide. For a brand that was just introduced in 95 this is an incredible achievement.
This generation of gaming is considered to be the catalyst to the current generation of the videogame industry, where everything has exploded culturally and been embraced by both consumers and marketers; the times where only teenage boys played games, where games where limited by technology and unprofitable are now over.
9 (www.thegameconsole.com/videogames01 , Game console history
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2.2 Present state of the videogame industry
It is undeniable at this point that the videogame industry is one of the most successful industries in the entertainment sector and some would be willing to stretch that and say that in the coming years other mediums will be overshadowed by videogames. Indeed signs for this have already been shown as expressed by Mr. Edery “While growth in the movie industry has been slow and while the music business has contracted, games have grown at double-digit rates. Games are now on the verge of eclipsing the music industry and have already surpassed Hollywood box office revenues.”10 In fact in 2008 Media control GFK announced the sales numbers for all packaged media (DVD, Bluray and games). They found out that 53% of all sales were made by games or in other words $32 billion. On the other hand DVD’s and Bluray combined suffered a year on year 6% drop in sales, bringing it to $29 billion. 11 Not only are videogames outselling other media, but it is at what price that is surprising; DVD’s sell at around $20 while an average game costs $55.
Furthermore videogames have now finally been introduced to all target groups which have accepted them as one of their main sources of entertainment and leisure. It is because of this acceptance in the mainstream market that the industry has sprung out of the stalemate they were facing several years back.
The main factors that influenced the current state of the videogame industry are addressed in the following pages. This information is very important for the thesis’ argument and for the reader to hopefully get a sense of how immense this industry is and how ironic it is that marketers have ignored it for so long and still to this day stay on the fence on whether to use it as a medium for advertising.
Cultural acceptance As briefly discussed in the previous chapter, games have finally become part of our culture, an integrated part that all genders and people of all ages are aware of. In fact in 2007 a survey was conducted in Canada to see which picture was more recognizable: Mario the plumber (from ‘Nintendo’) or Canada’s Prime Minister, Stephen Harper. The answer was Mario. 12
The videogame industry has always struggled to get attention, considering that the TV and Radio are its competitors, it isn’t surprising that people just didn’t take notice. Things have dramatically changed however, with over 70% of American households owning a console system 13 and the age bracket of gaming extending from 7-18 years old as the main audience to covering under 18 to over 50 year olds. It is largely because of the mainstream attention that videogames are getting, that their current success was possible. Without attracting the general population games would have been stuck as a teenage male centric entertainment medium. What exactly are the current target groups? What age group represents gamers? And are males still the dominant audience?
10 (David Edery, Ethan Mollick 2008, Changing the game . p.3) 11 (www.gamasutra.com/php-bin/news_index.php?story=21990 ) Worldwide packaged media sales 12 (David Edery, Ethan Mollick 2008, Changing the game . p.3) 13 (www.businessandgames.com/blog/2009/01/superb_presentation_video_gami.html ) Game trends
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Target groups The tables below represent the current global picture of the videogame target groups 14 :
Figure 3 Age ratio of gamers Figure 2 Gender ratio of gamers As can be seen the audience for those who play videogames has greatly expanded and perhaps most interestingly, the female market is now almost on par with that of males. The average age for the core gaming as of 2008 was 32 years old. Any advertiser that sees these statistics can immediately see that this is a balanced industry with the possibility to market a product effectively.
Unfortunately I cannot accurately say how many people worldwide play videogames. There is no accurate data on that. However I can use logic and available data to say the following: Hardware sales for consoles dictate the number of console players, anyone with a computer and/or internet is a potential gamer too and finally there are those who game on their phones. I will not attempt to place on a number on this topic however based on this reasoning a large quantity of the world’s population has the potential to play games in the very least.
To finalize this section 59% of gamers play alongside at least one other person watching, this potentially expands your perceptive audience by an average of two. 15
Financial success The current economic recession has signified losses for every industry that is except videogames, many have claimed it to be recession proof entertainment. 2008 saw the gaming industry enjoy a 19% growth from 2007 with no signs of slowing down. 16
The gaming industry has matured very quickly; it has positioned itself in a way that they cannot be ignored any longer. Success as many experts claim can be seen through financial success. As of 2009 the gaming industry has become an estimated $45 billion industry. 17 18 While most new music records struggle to get one million in sales, games have somehow managed to surpass that and even in some cases come close to matching blockbuster movies.
14 (www.businessandgames.com/blog/2009/01/superb_presentation_video_gami.html ) Game trends 15 (www.businessandgames.com/blog/2009/01/superb_presentation_video_gami.html ) Game trends 16 (www.gamespot.com/news/6203298.html?tag=other-user-related-content;3 ) Analyses 2009 17 (www.businessandgames.com/blog/2009/01/superb_presentation_video_gami.html ) Game trends 18 (www.vgsales.wikia.com/wiki/Video_game_industry ) Industry worth
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For example, ‘Killzone 2’ a ‘Playstation 3’ exclusive game has sold 1.1 million units in preorders 19 , that is before the game has even been completed or reviewed. ‘Resident evil 5’, ‘Capcom’s’ new survival horror title has sold over five million units in its first two weeks. 20
Perhaps the most popular success story in gaming is of ‘Blizzard’s’ ‘World of Warcraft’. This was one of the first Massive online multiplayer games and a huge risk for several reasons:
1. It can only be played on the PC 2. It can only be played online 3. It requires the players to pay $15 a month in subscription (apart from purchasing the game)
Needless to say, if any movie or CD came out today asking for the customer to pay monthly to use the product after purchasing it, most likely it would be a failure. ‘World of Warcraft’ however made it work. The game was released in 2005 and to this date it is still the most profitable game in the PC platform, with over 11 million in sales (and monthly subscriptions) the game is a tremendous success. The game generates an average of $1.1 billion a year. 21
The ‘Nintendo Wii’ is however the single force that has elevated gaming to a whole new level. It has been the reason for casual gamers to get into the market and for the industries growth. In fact around 50% of 2008’s worldwide hardware sales came from ‘Nintendo’ with two ‘Nintendo’ exclusive games holding the top two most sold games of 2008. 22
Hopefully these brief examples show the reader how successful videogames can be, and the potential audience that can be exposed to an advertisement in this industry.
Current platforms It is extremely important to understand which platforms in the market support gaming and the potential for advertising. It is important for the reader to clearly see what the current gaming platforms are; because it is within these that an advertiser needs to work. Target groups and their behavior towards the platforms greatly varies, but will be explained in a later chapter. For now I briefly introduce the different gaming systems to provide an overview.
Consoles Consoles are and will be the main platform for enthusiast gaming in the coming years. They are the systems solely manufactured to play games. As mentioned in “videogame history” there are currently only three brands competing in this market:
19 (playstation.joystiq.com/2009/02/05/europe-goes-preorder-mad-for-killzone-2) Killzone 2 preorders 20 (Joystiq podcast March 2009) Resident evil 5 review 21 (David Edery, Ethan Mollick 2008, Changing the game . p.16) 22 (vgsales.wikia.com/wiki/Seventh_generation) 2008-2009 sales
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‘Nintendo’s Wii’, ‘Microsoft’s Xbox 360’ and ‘Sony’s Playstation 3’. These are the brands that own the console market. Getting into the details of each is irrelevant for this thesis. However there are aspects of these modern consoles that strongly increase the potential effectiveness for advertisers.
- Online functionality : All consoles support internet connectivity, what this means is that every game can be updated post-release with the possibility for online gaming. For an advertiser this is incredibly interesting because it means the possibility to dynamically modify games at all times. - Technological advancements : The current generation of gaming shows unprecedented graphics, so much so that when done correctly can blur the lines between fiction and reality. These advancements have lead to more modern based games, games based in real settings, cultures and worlds, for advertisers this means more possibilities to implement their brands realistically. Advertisers have a perfect fit now, to place ads where people would expect them. Beforehand most games where fantasy based and cartoony, advertising would have been incredibly intrusive.
All of these aspects and more are discussed in detail within their relevant chapters later on.
Platform Consoles (January 2009) Software (2008) Units sold worldwide Wii - 44.96 million 1. DS, Nintendogs - 20.03 million DS - 96.22 million 2.Wii, Wii Play - 16.15 million Xbox 360 - 28.5 million 3.Xbox, PS3, GTA 4 - 10 million Playstation 3 - 21.3 million 4.Xbox, Halo 3 - 8.1 million PSP – 22 million 5.PS3, Metal gear solid 4 - 4 million
Figure 4 Worldwide sales - January 2009 23
Handhelds The handheld market is booming at an alarming rate. It was always considered the small brother of the consoles, never able to meet its sales of both hardware and software. However the ‘Nintendo DS’ has proven everyone wrong. The casual movement of ‘Nintendo’ created the ‘DS’ a system that within a year will be claimed the best selling gaming hardware worldwide. ‘Sony’ also has a handheld in the market; the PSP. These are in fact the only two handheld devices in the market.
Even though they sell outstandingly (apart from the PSP), they are still overshadowed by the consoles, simply because there is little software and dedication being put into developing for them. Software sales for both systems are generally not as high, and the average rating for their games are mediocre. 24
23 (www.shacknews.com/onearticle.x/56993 ) Worldwide sales 2009 24 (www.ign.com/reviews ) Reviews
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PC This platform is probably the most confusing and complicated yet it has tremendous potential for advertisers. For starters, PC game sales are very underwhelming, why? Because of piracy, while the gaming consoles are largely unaffected by piracy the PC has been crippled by it. In fact games sell 4-5 times more on consoles than on PC 25 , with over 80% of all PC games being downloaded illegally. In 2007 ‘ Call of duty 4 ’ one of the most popular and best rated games of that year sold three million copies at launch in the US while PC sales were a mere 383,000 units, that is over a 4:1 ratio. 26
Sadly it is hard to predict the future of PC as a traditional gaming platform…on the other hand there are other areas that the PC excels at, areas that are not touched by piracy or sales.
MMOG (massive multiplayer online game) The success of ‘ World of Warcraft’ shown previously is a sign of the possibilities of online gaming. Even if all the copies of the game were pirated, players would have to face the subscription fees. Furthermore in China they have already started developing such games, where you do not pay for the game itself, rather just per month or for alternative products.
Internet The PC is still the most used piece of technology, mainly for its internet. Coincidentally there is a massive gaming community which just plays casual internet browser games. These games could be anything from ‘solitaire’, to a flash game to games such as ‘second life’. The internet holds an extensive collection of free games for anyone to spend a few minutes on. In fact the development of these casual games is so cost effective and time efficient that many companies have started publishing their own games on their websites.
Phone games These are restricted to ‘Apple’. Mobile games have been around for a while; however it is ‘Apple’ with its ‘I-phone’ and ‘I-pod touch’ that have created a platform for gamers. This is an incredibly new development in the industry, one which few have predicted. ‘Apple’ made a bold decision in announcing that anyone who develops applications for their system will have the chance to sell it on the ‘Apple store’. Literally thousands of applications are created each month, many of which are games 27 . Most importantly these self developed games are usually sold for free, and cost relatively nothing to make (since the tools are made available publicly).
What has started to happen is that, more and more of the handheld gamers are starting to pay attention to the ‘I-phone’ as a gaming platform. Game developers have started developing official games for the system and the success is already evident. ‘ Enigmo ’ an ‘I- phone’ game developed by ‘Pangea’, sold 810,000 copies of the game, they generated $1,500,000, with the costs of making the game being… zero .28
25 (www.tweakguides.com/Piracy_5.html ) Piracy in PC 26 (www.tweakguides.com/Piracy_5.html ) Piracy in PC 27 (www.gigaom.com/2008/07/21/is-iphone-the-new-gaming-platform/ ) I-phone games 28 (www.joystiq.com/2009/03/17/sxsw-2009-iphone-the-new-gaming-platform/ ) success in I-phone
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One can quickly see the potential and possibilities to at least try to distribute a game through these alternative new means.
Hopefully a general overview of the platforms has been presented, enough to understand where they are positioned. In the final two chapters of this thesis possible ways to advertise in videogames are explored, the reader now understanding the gaming platforms will find it easier to connect the possibilities with the platforms. 2.3 Current struggles of the industry
One could easily write a separate thesis simply based on the following issues discussed; though the theme of this thesis revolves around advertising and videogames, it is important for the reader to understand the issues the industry is facing, since ultimately they have a direct relationship to how and whether advertisers would use this medium for their practices.
Development costs As games have become more advanced and demanding so have the development costs, especially for the console platforms. Creating a triple ‘A’ game such as ‘GTA 4’, ‘Halo 3’ or ‘Killzone 2’ can be paralleled to producing a big budget film; the costs are in the millions. A good example of this is GTA 4 which cost around $100 million to make. 29 It usually pays off with the titles selling millions of units worldwide. However this is starting to become a big issue for developers and gamers. With film anyone with a budget and a camera can essentially direct their own film then find audiences to sell it to, with games you need programmers, directors, artists, publishers and manufacturers. There are very few independent games as a result simply because retailers wouldn’t support them. Gamers on the other hand constantly struggle with purchasing games in the $55-$70 region. Videogames are an expensive hobby and both parties know it, the industry understands that experimenting needs to be made to fight these costs. If production costs keep rising, will players need to pay more? Or will developers turn to alternatives such as sponsoring and advertising to lower costs? All bets are off at the moment, as companies’ research and experiment different methods. One of these companies is ‘valve’ a gaming company that has developed their own digital distribution system (steam) for the PC which allows them to directly influence their pricing and other factors as they wish. Gabe Newell president of ‘Valve’ commented on the effects of lower priced games “Valve undertook an experiment recently to test how price affected the sales of the popular survival-horror FPS, ‘Left 4 Dead’. We reduced the price by 50% on Steam, which "resulted in a 3000% increase in sales of the game, posting overall sales that beat the title's original launch performance.” 30
Social backlash As the industry became more profitable and the media started paying attention to it, a common issue arose: negative mainstream curiosity. Historically any new form of entertainment has had to survive through the public’s fear and misunderstandings before becoming an acceptable form of entertainment. Let’s take for example the comic book and rock and roll early years. They both faced years of public and media attacks. The public simply did not understand where they were coming from, if they were good or evil, on the other
29 (http://ve3d.ign.com/articles/news/38395/GTA-4-Cost-100M-To-Make ) GTA 4 costs 30 (http://games.slashdot.org/article.pl?sid=09/02/20/0750203&from=rss ) Valve reduces prices
~ 16 ~ hand the youth enjoyed these mediums, which lead to parents doing whatever they could to ban these entertainment methods in an attempt to protect their children from what they didn’t understand. Then again; books, radio, TV and films all faced the potential of being banned. 31
The same can be very much said for videogames. The industry is still to an extent facing its early growth pains of being accepted and understood. Many social groups, lobbyists and activists (mostly parents) are focusing on two distinctive issues to try and ban videogames:
- Violence : Since the beginning, this has been the prominent focus of attack. Videogames have mature titles just like TV, film and magazines. However it is the interactivity of the violence that has parents in rage. As technology develops so does the quality of games, they are now as realistic as ever, and as a result this has sparked the new generation of anti gaming movement. Certain groups have tried to tie a relationship between videogames and popular violent acts such as school shootings and teenage violence. However studies in the US have shown that between 1993 and 2000 juvenile violence has not increased, 32 in fact it has declined. Furthermore research conducted by the ASA (American sociological association) noted that, in the time that ‘DOOM’ and ‘Mortal Kombat’ were released (the most violent games in the early 90’s) videogame usage “skyrocketed” while at the same time arrests on juveniles fell by 77%. 33 Finally the research concluded that the fact that a gamer needs to interact with the violence makes them more grounded in reality and less emotionally involved than in movies; in violent films the main character will kill throughout the whole movie without dying, or the villain will kill until the movie ends simply because the movie needs these characters alive for there to be a movie. In a videogame your character can fail and you as a gamer will be punished for it, giving a sense of danger in the very least. 34
Finally as with any other media, videogames have ratings. A parent can easily see if the game is suitable for their children or not and the fact that 90% of videogames are bought by adults over the age of 18 brings out an entirely new issue. 35 Are these parents irresponsible and uninformed? It is a damaging question admittedly, regardless the bottom line is that a parent who truly worries or fears for what their child is exposed to would know what they were playing… as research has shown, parents are in fact the group that buys the games for their children who would otherwise not be allowed to buy a mature game. The truth is fear controls our emotions and when faced with media hype and biased research an unaware parent can easily find a relation to their fears.
- Obesity : The final issue that the mainstream has with videogames is that they contribute to obesity. It is true that videogames are not the healthiest of entertainments; they require you to commit hours. Again however, it is hard to believe
31 (David Edery, Ethan Mollick 2008, Changing the game . p.25) 32 (Marolf 2006, Advergaming and in-game advertising. p.26) 33 (David Edery, Ethan Mollick 2008, Changing the game . p.26) 34 (David Edery, Ethan Mollick 2008, Changing the game . p.26) 35 (David Edery, Ethan Mollick 2008, Changing the game . p.27)
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that this specific entertainment form out of all others is considered to be the source of this problem. 36 The following is an example of a recent ad from the British government:
Figure 5 Anti videogame ad
It can be clearly seen that the child is playing a videogame. The ad suggests that playing games will lead to an early death. This is a very bold and violent statement towards an industry that has globally stimulated the economy while others have failed. Many critics have openly stated that using the ads logic, reading a book, watching TV or even doing your homework will lead to an early death. Ironically playing videogames demands the usage of two hands, leaving no room for snack eating. 37 Again one must ask themselves…instead of campaigning and trying to ban a successful medium why not take the direct approach of controlling how much a child plays? Luckily the educational system understands that games can actually stimulate children to have fun while burning some calories. More than 1,500 schools in the US will be installing DDR (dance dance revolution) games in their schools. This game requires the player to dance in rhythm to the steps indicated on screen. Furthermore systems such as the’Wii’ require constant physical activity, of which many have complained of muscle tiredness and feeling fatigue which in other words are signs of exercise. 38
36 (www.cfah.org/hbns/news/video03-17-04.cfm ) Videogames NOT TV as source of the problem 37 (www.pcformat.co.uk/blog-entry/risk-early-death-just-do-nothing-10-03-09 ) change4life ad 38 (www.theinquirer.net/inquirer/news/525/1046525/wii-dangerous ) Wii exercise complaints
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2.4Why is the videogame industry so important?
Even though the issues discussed above are serious and need addressing one thing is certain, videogames are quickly becoming an accepted and successful medium. The attention they receive is a sign of its impact in our culture and on the minds of people. However even then it is still an untapped source of possibilities for advertisers and companies to use to their advantage for promotion. Hopefully by this stage the reader already has a good basic understanding of the positive growth the industry has had, and the upper hand it is quickly developing over competing industries.
Videogames as an industry are more important now than ever before, I am not referring to the videogames themselves and how advertisers need to acknowledge them, that is discussed later, for now I am simply referring to the industry.
For starters promoters should take notice that the videogame industry has a significant impact on the economy, in fact it is the only entertainment medium that has shown positive growth year on year even during our current economic climate. This year’s February (2009) has brought in $1.47 billion in the US compared to February 2008’s $1.34 billion that’s an average of 10% year over year increase in sales, during February which historically is a slow month for sales. 39 Other media have accepted the success of the industry and ported their intellectual property; most big budget films get a simultaneous videogame release (which in occasion outsells the movie itself), comic books have ported their heroes to videogames for many years and finally artists have just realized that by lending their songs to ‘guitar hero’ and ‘rock band’ they can generate more money that on actual CD sales. 40
A good example of other entertainment shifting to videogames in the now announced ‘The Beatles’ game for rock band. The hype this game is receiving months before its release is sensational, one must understand that ‘the Beatles’ being the most recognized, influential and controversial band in the world have never lend their music to other media (especially not in this proportion). The game will allow you to play as any of the original Beatles while playing along to over 90 of their master tracks some of which have never been heard before . The fact that the Beatles and their management have come to an agreement to release this game is a significant milestone, that they are allowing their fans to play the original songs and some that have never been released before, that is a historical achievement. 41
Advertisers should take notice, as this is in essence indirectly an advertisement for the Beatles. The impact the videogame industry has had has lead to artists and visionaries from all across other industries to try and get a piece of it.
The attention and economical dominance the industry has acquired has as a result lead to an avalanche of new gamers, and to some, potential customers. For promoters this means a large
39 ( www.zdnetasia.com/news/business/0,39044229,62052368,00.htm ) 2009 increase in sales 40 Guitar hero and Rock band are games in which the player imitates the act of playing as a band with the controllers designed as instruments. 41 (www.guardian.co.uk/music/2008/oct/31/beatles-videogame-rock-band ) Beatles videogame
~ 19 ~ pool of target groups, one no longer can say there are age and gender restrictions as shown above.
The videogame industry is quickly maturing in a much faster rate than anticipated, while at the same time due to its young history being a flexible and largely undiscovered source of entertainment. This is good news for those wishing to promote their brands or in the very least consider trying to, because we are now looking at an industry that has the effective reach in par with other media while at the same time, in the meantime it is a fresh new source of entertainment for many, and there is no such thing as fixed advertising models, or prime time slots. A promoter would do well in looking into the possibilities of this medium, there are many areas in which a brand can be exposed successfully using videogames, many advantages that videogames have over other media and finally a revolutionary new way for audiences to familiarize themselves with a brand in creative and fun ways.
All of this and more is discussed in detail in the later chapters. Hopefully this has generated the reader’s interest into wanting to investigate this topic more in depth, but first a brief analyses on advertising and a lead in, into the core of my hypothesis: “Videogames as a platform could become one of the most effective forms for advertising”.
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3. Advertising industry
This chapter begins with the definition of advertising. There are many definitions and theories on what the core definition of advertising is. Many experts and professors currently argue about this definition however since, new media is emerging and new rules are set.
However the basic concept is undeniable: “Advertising is defined as any paid form of non personal communication about an organization, product, service, or idea by an identified sponsor.” 42
From book to book all definitions refer to advertising as non personal; this refers to the mass reach aspect of this form of promotions. It generally (especially in the past) did not allow for two way communication or feedback from the consumer. This however has changed and is very relevant to this thesis. Videogames allow for both mass promotions and two way communications; however this will be touched upon on a later chapter.
Finally advertising is not always necessarily ‘paid’. There are many forms of free advertising however experts have agreed that the majority of paid advertising is such that shadows other forms. 3.1 History of the advertising industry
The importance of advertising is undeniable; it is a key part of our economy and a reflection of our culture. Considering most economies rely on consumers purchasing goods and products to stimulate economy one can quickly see why billions are spent on advertising. Quite simply without advertising, people’s buying behavior would be affected, sales would drop and historically those nations with weak or minimal advertising are ironically in economical tribulations.
As with the ‘history of videogames’ chapter, it is important to at least briefly touch on the history of this industry and how it got to where it is today. However for the sake of this thesis it is not as necessary to grasp the advertising back story as it is to understand videogames.
The early years Needless to say, advertising has a very long and deep history. Unlike the 30 year stretch that the videogame industry has enjoyed, advertising can be dated back to the 17 th century. In fact the first advertisements (based on the definition) came in the form of simple black and white text ads in newspapers. At the time there was no form of printing imagery or colour in mass quantities hence these ads were limited and factual, there was no persuading they simply stated a product and its price. 43
42 (George E. Belch, Michael A. Belch. 2004 Advertising and Promotion. p.16 ) 43 (www.mediaknowall.com/gcse/advertising/history.html , history of advertising in brief)
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It was not until the later stages of the industrial revolution that advertising started taking its modern form. It started with imagery, layouts, fonts and general design. The ‘advertisers’ realized the need to make these ads attractive and most importantly how to make their products a ‘need’. This came about because of the growth in population and towns, suddenly there not only was more competition but there was a large market, a market that would never hear from your product unless you found a unique way to attract them. 44
The early forms of mass media back then where newspapers and coffee shop magazines. The first advertisement agencies quickly emerged, these where namely; Charles Barker and George Street . They managed to stay in business because of the demand, advertisers quickly came to terms that if they did not promote their products, no one would buy them because no one would hear about them.
As technology improved and printing methods became more efficient, advertising started becoming a true method for mass promotion. Advertisers started thinking creatively, and about their target groups, they started the foundations of marketing. 45 A great example of this is Lipton, a company which is still with us today. They realized that by placing their advertisements on the side of horse carriages, their ads would be distributing themselves and random people would be exposed to it constantly. Because of these approaches companies such as Lipton have been able to survive to this day.
Figure 6 Lipton advertisement from 1893
44 (Yadin, Jefkins, 2000 Advertising. p.2 ) 45 (Yadin, Jefkins, 2000 Advertising. p.3 )
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Modern age By the time that WW1 came around advertising was a standard means of promotion, people were aware of it; it was not a new phenomenon anymore. However it was not until this war came along that Government noticed the power of advertising and used it to persuade minds, to advertise the needs to fight for ones country. The British were the first to use propaganda on its people, and to great effect. 46 At this point both Government and Advertising agencies understood the psychological impact that could be achieved through mass promotion. After WW1 radio became a common commodity, one that soap manufacturers quickly set their eyes on. It was not long before ‘sponsors’ were created. They would pay for the radio program in return for commercial ‘plugs’ throughout the show.
The end of WW2 however is what introduced the big boom in advertising and the change of a successful and cost effective promotion tool into the most costly and lucrative form of promotions: the TV. The introduction of the television meant that advertisers could finally use sound and vision together, however most importantly…they could reach them at home. Needless to say advertisers run to TV and soon the airwaves were filled with advertisements, since then not much has changed. Advertisers still to this day believe the TV to be the ultimate form of advertising. 47
The end of the 21 st century and our current one bring new challenges to advertisers and advertising as an industry. By now every single one of us is exposed to around 200 ads a day 48 , most of us simply do not notice anymore, it is such an integrated part of our culture and daily life that they go largely unnoticed.
New media and consumer behaviour are making it more and more difficult for advertisers to pin point their target groups. Furthermore competition between brands is so numerous and staggering that to differentiate one’s brand, a masterful marketing plan is needed, and one that needs to embrace alternative forms of advertising, methods that have come with the new age and can once again gain a person’s attention. Could Videogames be the answer?
46 (www.mediaknowall.com/advertising/history.html , history of advertising in brief) 47 (www.allbusiness.com/marketing/advertising-television-advertising Television advertising) 48 (us.i1.yimg.com/us.yimg.com/i/adv2/pdf/brainfood/adexposures.pdf Advertisement exposure)
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3.2What makes an effective advertisement?
Considering the topic of this thesis it would be irresponsible not to cover the fundamentals of what makes an effective advertisement, as to come to an agreement with the reader on the context to later on judge videogames as an effective platform. In general the goal of advertisers is of an economic nature, advertisements should influence a targets purchase behavior, however turnover is by far a bad litmus test to consider ad’s effectiveness. In truth ads can have very distinctive goals 49 :
- Increase sales : Quite literally, to promote a product through advertisements with the hope that enough people see and connect with it to directly purchase the product/service. This is usually of course at the core of any advertisement objective, whether they directly ask the consumer to buy the product or not, the intention is for the targeted consumer to give feedback to the advertiser financially. - Inform (Increase awareness, persuade, remind): This is also a common objective. It usually revolves around an already existing product. Every advertisement tries to persuade a consumer to take action whether it is indirectly or otherwise. These ads can also come in the form of a reminder, for example reminding the viewer that in the coming week there will be discounts. The objective here is to manipulate the perception and knowledge a consumer already has of your brand, all using psychological techniques. Thus the purpose is to sell the viewer the needs of your product, and try to convince them to consider your brand. The aim is not necessarily to increase sales, rather to inform as many people as possible about your message - Supporting a brand identity: Finally the goal here is for brand loyalty building. The core goal is to build a relationship with your target and turning them into a loyal brand consumer. Essentially such ads try to turn people from using any brand to using the advertiser’s. Furthermore it is closely related to image management; the ads are selling the advertiser’s brand image and in some cases perceived lifestyle.
Figure 7 Axe commercial playing on simple emotions
There are more separate goals for general advertising; however the focus on this chapter is on the effectiveness of an ad itself. There is a clear roadmap that every advertisement strives to achieve, and incidentally this roadmap is directly linked to what medium the advertiser chooses to advertise on. It is from here on that videogames and advertising are going to start being mixed in the dialogue, as to ease the reader into the hypothesis of this thesis.
49 ( http://www.bnet.com/2410-13240_23-64268.html ) Advertisement objectives
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Effective advertising “Effective advertising makes people stop, think and take a course of action. In a fraction of a second, it can clearly communicate a message, concept or idea to an audience who may not know you, your product or your service.” 50
The quote above provides a clear and to the point introduction on what an effective advertisement should achieve. There is an anecdote that greatly helps explain the aspects that make an effective advertisement: AIDA 51
Action
Desire
Interest
Attention
Figure 8 AIDA model
In order for an ad to be successful it should fulfill the above responses from a viewer. 52
Attention: At the very basic level, the consumer should be made aware of what you are advertising, quite simply striking enough to make the addressee pay attention. Usually this is done by creating emotions, through humor, fear, greed etc…
Interest: The ad should then spark something in the viewer, connect to them in a level where they feel the ad is relative to them.
50 (www.reidgroup.com/stage/main/advertising/effective.html What is effective advertising 51 (www.davedolak.com/advtg.htm ) Aida model 52 (Marolf 2006, Advergaming and in-game advertising. p.10)
~ 25 ~
Desire : The desire is the optimal emotive and personal effect an ad could have on someone, if the ad has managed to gather the viewer’s attention and generated enough interest to make it a psychological need to the potential consumer then desire has been achieved. By this stage the addressee is already interested in buying the product advertised. This is the stage where the buyer must justify his desire, the advertisement usually does its best to ‘make their mouths water’ at this last stage.
Action: Desire means nothing if the viewer does not finish the process; there is a need for the addressee to take some sort of action for it to be a truly successful ad. In reality very few ads achieve more than the first two stages, to a certain extent that is expected since not all of your ads viewers are in fact your target group; however there are ads that can make anyone desire the communicated message.
Luckily videogames have attributes and characteristics that push it above other mediums as a helpful and creative way to successfully advertise. When it comes to attention, videogames provide a fun interactive way to deliver a message with an extensive time to generate interest in the player, using characteristics that only videogames benefit from an advertiser can actually virtually show the player what his product can do, how it works, he can make the player live in the brands world and finally using the benefits that the internet has brought as an advertiser you can immediately allow the player to take action; ask for more information, purchase product, visit website, enter email etc…
There are many factors to why advertisements are largely ineffective, especially as time goes by and what are considered established advertisement vehicles are now nothing more than casual entertainment to most. It is important to note that the mediums used have a huge impact on how effective your advertisement will be, for they all have their limitations. Limitations that impact an advertiser’s budget and reach. Even if you have a tremendous creative ad that meets all the points described above, it means little if the target groups are not reached or if they do not consume the information given, traditional ads have limited space and time to convince on their points. Billions upon billions are spent each year on advertising trying to meet their objectives, while 50% 53 of advertisements go to waste due to in large the medium’s limitations. The following section delves deeper into these issues.
53 (www.powerhomebiz.com/vol61/advertising.htm ) How to create effective ads
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3.3 Brief look at the present state of advertising and why it needs to explore new mediums
Advertising is undeniably an important and integrated part of not only our culture but our economy; in itself the industry is responsible for a big percentage of national GDP 54 , in more monetary terms, worldwide advertising expenditure is around $500 billion year on year 55 . 50% of which come from the US. Overall however there has been a slowdown in advertising growth, obviously due to the caution flags being waved by the economic downturn. 2007 for instance saw growth by 2.5% instead of the predicted 3.3%.
The following are the general vehicles of advertisements: TV, print media (newspapers, magazines), radio, internet, outdoor, direct sales.
Advertisement expenditure/medium usage The tables below give a pretty accurate estimation on percentage of usage and hours spent on different media. Although they do not represent the most up to date statistics, they provide the overall picture for the argument of this section.
Figure 9 Media usage in the US 56
54 (www.economywatch.com/world-industries/advertising ) Advertising finance 55 (Marolf 2006, Advergaming and in-game advertising. P.9) 56 (Marolf 2006, Advergaming and in-game advertising. P.19)
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Figure 10 Hourly usage in Europe
The biggest difference up till now is radio vs. internet; the internet has skyrocketed while radio has gone down significantly, the most important thing to gather is that advertisement expenditure has not noticeably changed.
With the popularity of the internet and online media, a shift has been made to these formats. In fact 2008 saw a 30% rise in internet advertisement over other media. 57 This is not a new trend though, we are all aware of the effect the internet has had on other media; it has dramatically changed the playing field. Consumers no longer pay attention to newspapers and print media in general, with an estimated drop on advertising of 29%, 58 “Newspaper industry leaders are frogs in a pot. The water’s starting to boil, and it’s time to jump. Only 19 percent of 18-34 year olds read a daily newspaper; 44 percent of them go to a web news portal. Broadband penetration has reached 57%.” This is a quote from Don Dodge a popular business and technology ‘blogger’. 59
Television is still the most used source of media, with most of the advertisements going to that medium, as it has always been traditionally. This is a trend that is very likely to change however, the television penetration is undeniable, who doesn’t have a television? The pattern one can take from these charts is that as a rule advertisers have put their efforts to the mediums they ‘think’ (based on usage) will have the most chances to gather ‘eyeballs’ 60 . What has happened to videogames though? Even in 2005 as figure 9 shows they were already
57 (www.economywatch.com/world-industries/advertising ) Advertising finance 58 (www.economywatch.com/world-industries/advertising ) Advertising finance 59 (dondodge.typepad.com/the_next_big_thing/2006/09/are_newspapers_.html) Business blog 60 Eyeballs: The potential number of viewers
~ 28 ~ generating a significant percentage of usage and more hours spent a week than internet. Based on the research shown in chapter 2 of this thesis, the reader can see that videogame usage has more than doubled since 2005 making it one of the most used entertainment mediums to date.
The new millennium has brought with it new user behaviors and trends. The most important being how we as consumers consume media. When it comes to information we must have it whenever we want and as quickly as we can get it, and the answer has been the internet, making newspapers and to a certain extent television almost obsolete when it comes to gathering information. We no longer have to wait for a newspaper to be printed, or for the news hour, news websites are constantly updated, making them the most up to date source of news. Any other information simply requires a search engine; it almost seems as though the internet has become an essential technology in our lives. It is entertainment however that generates the hours that people spend using media.
Television is still considered the number 1 source of entertainment followed by music and videogames . In fact Internet and videogames are soon to take over the top 2 slots in the coming years, with internet having an estimated 1,500,000,000 users. 61 One must understand that even though the internet is a widely used tool and essential to our lives, it is used on short spurts and for specific reasons. The top 3 being: 62
1. Communication 2. Information 3. Games
Hence games are one of the primary reasons for internet use, adding these statistic to that of videogame usage in general, and you have a medium impossible to ignore as an advertiser. Furthermore when it comes to hours of usage, videogames demand hours of constant attention, while other media do not require the full attention of the devotee.
A great example to put mediums in modern comparisons is with American football. When it comes to the ‘Superbowl’ advertisers know this is the most viewed event on television in the US each year 63 , with an average 30 second ad costing $3 million 64 , it is also the most expensive. Coincidentally EA (electronic arts) a videogame publisher and developer studio release ‘Madden’ every year (a videogame representing the sport with the ‘Superbowl’ being the finale). The franchise as a whole has sold over 70 million games, with each game in the series selling approximately 5-10 million units 65 . As with the real ‘Superbowl’ and American football realism, all games have real characters, real stadiums and the real advertisements. It is important for the reader to understand that even though the ‘Superbowl’ generates more potential reach in one specific moment, videogames generate a significant amount of that reach constantly , the ads are part of the game, a game which is played for an average of 12
61 (www.internetworldstats.com/stats.htm) Number of global internet use 62 (www.zonalatina.com/Zldata371.htm ) internet usage 63 (http://news.bbc.co.uk/1/hi/entertainment/7227794.stm ) superbowl 64 (www.statesmanjournal.com/article/20090128/COMMUNITIES/901280430/1138/STAYTON&template=stayt onart ) Superbowl ads 65 (www.askmen.com/top_10/entertainment_300/317b_top_10_list.html ) Madden sales
~ 29 ~ months (between releases). Furthermore one must take into consideration the costs. The ‘Superbowl’ is supposed to be the best chance advertisers have at reaching a mass audience, and for that they are willing to pay millions. Unfortunately for advertisers research has shown that these ads are far from effective, perhaps this is in general a cultural issue however, most ‘Superbowl’ ads are not remembered,66 this could have to do with the fact that it is the brands that need the advertising the least that buy the most ad space… to an average consumer this is far too common in their perception, ‘Coca-cola’ is ‘Coca-cola’, ‘Nike is Nike’, these are brands so integrated in our culture that their ads leave a very unmemorable impression. Smaller brands that need the space cannot afford this venue. Lastly such television exposure could also equally hurt a brand, there is a lot of pressure to impress especially if a large sum of an advertisers budget is saved for such an occasion.
Figure 11 madden 09
Advertising on videogame systems offers some significant advantages considering all aspects that make an effective cost effective ad. The videogame format is incredibly diverse (as will be presented later), moreover the average costs to advertise in this medium rarely reach that of television. This example briefly touches on some areas that should make advertisers exited about videogames especially when compared to using other media.
Traditional medium limitations There are certain core factors that greatly impact an advertisement’s effectiveness, some of which videogames can exclude themselves from or greatly deviate:
- Reach and frequency : Reach and frequency are used to evaluate the potential exposure of an advertisement, generally across all mediums 67 . For example when it comes to television advertising, each household that has the advertisement in their
66 ( www.adweek.com/aw/content_display/custom- reports/superbowl/e3ic96aa80f511fb30f1a0632343226a06b ) Superbowl ineffective ad spending 67 (www.allbusiness.com/glossaries/reach-frequency/4966469-1.html ) Reach and frequency definition
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television schedule is considered a reached household, how many times the household is exposed to the ad is the frequency. With a magazine or newspaper, how many papers sell is considered reach. When it comes to the internet however advertisers are still struggling with models to effectively calculate exposure. The current method is to calculate how many people visit a website vs. how many ‘click’ on the ad. One ‘rule of thumb’ for marketers is that reach without frequency = wasted money 68 , it is true since after all general research has shown that an average person needs to be exposed three times to the same message to remember it.
The reach and frequency model has been largely unchanged since its invention, however one can quickly see that its vague nature is flawed, and one cannot truly understand the effectiveness of their advertisements without hard data. Simply implying that potentially an audience has seen or heard your advertisement does not cut it considering the amounts of money spent on it. Indeed this has been an issue in the industry for quite some time, many are satisfied with rough estimations then again there isn’t really another model out there to test your advertisements against. Experts have only recently accepted that frequency over reach is more effective; one is more likely to build a small effective rapport with a small audience who is exposed to your brand on more than one occasion rather than reaching a wide audience on a one off basis. 69 Still the model fails in that even if the advertisement was being played throughout the week at all hours, you still wouldn’t know if someone was actually watching or paying attention.
- Casual usage: The way we consume media has changed, reach vs. frequency is now more irrelevant than ever before, simply because the media around us is so implemented into our lives it has become a casual decoration, and one that we use while multitasking . For starters, it is true that television, radio and music to some extent still are greatly used media, but how is it used? Is the population carefully watching the television for the estimated 12 hours it is watched weekly? Is the population carefully sitting down in their sofa listening to the radio? The answer is no. Our lifestyles have changed and with it the way we consume media.
We consume media casually and while doing other things. The reason television and radio are still so highly used is simply because they are parts of our culture, they are turned on and left on while we live our daily lives. As a result advertisers cannot predict who is watching simply because the television is on. A study in the US has shown (based on 2,000 teenagers) that 24% of them watched TV while doing something else. 70 These numbers are generous, considering that when it comes to adults the numbers are considerably higher, a study from ball state university claims that overall over 50% of all media consumption takes place while the TV is on. 71 Radio and TV have to a large extent become background entertainment. Magazines and
68 (www.streetdirectory.com/travel_guide/5579/marketing) Reach and frequency 69 (www.financefacts.co.uk/reach-vs-frequency.htm ) Frequency better than reach 70 (www.masternewmedia.org/media/media-analysis/DeLoitte-US-media-survey-2007-usage-and-preferences- 20070928.htm ) TV usage 71 (www.marketingvox.com/when_media_multitasking_consumers_spend_time_with_mags_most-020987/ ) Multitasking statistics
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newspapers do require attention from the consumer since they have to physically use it; however as seen in the tables above, the print media is quickly dissolving and becoming nothing more than a source for enthusiast hobbyists.
Finally internet is generally the most widely used media, again though advertising here is to this date largely complicated and ineffective. 76% of consumers find internet advertising more intrusive than other advertisements. 72 The internet should be the ‘Holy Grail’ for advertisers; users must actively look at the screen while using it and pay attention to what’s on screen. Businesses initially thought that pop ups and spam where great ideas, since they could not be ignored, by now though we all know the negative effect those have on ourselves, ultimately they impact the advertiser negatively to the point where the brand image is potentially tarnished. Banners and other forms of internet advertising are simply not effective because of the nature of the internet. The internet is the most liberating form of media, it is a massive world of information, if it is already hard to reach and estimate reach on TV were there are a limited number of channels, imagine the internet with an estimated 4 billion + web pages, (finding a precise number was surprisingly impossible). Banners the most common form of internet advertising suffers from the same problems as traditional advertising; it’s simply not possible to predict who is actively looking at them. The click rate on an average banner is around 0.5% of overall visitors 73 it seems as though the mighty internet, the medium which advertisers thought would lead to the most effective form of promotion is no more effective than traditional media. Internet is used for specific reasons as mentioned earlier on. The internet is peoples’ chance to freely seek what they are after, when faced with advertising it feels much more intrusive.
- Expressiveness: This is a major limitation, one which many overlook including experts and marketing gurus. You rarely hear about how advertisements are limited by the media they are witnessed in, ironically there is nothing worse for an advertiser to not be able to communicate their message effectively, when you consider space, time and senses limitations the task becomes that much harder.
Every single media has its advantages and disadvantages that is true, however they all share limitations when it comes to the means they have for expression. With newspaper and magazine advertising, one would be lucky to at best have 1-2 pages in full colour, even if the printed ad is in the front page, the imagery and message has to be so striking and clear to the consumer that they are taken by it. A print ad may produce interest but the space limitations it has does not allow it to deliver essential information many times, or if it does it is very specific emotional messages. Motion and audio are taken from the mix, leaving the viewer without two of the most primal and important senses and the advertiser struggling to get attention through vision alone.
72 (www.masternewmedia.org/media/media-analysis/DeLoitte-US-media-survey-2007-usage-and-preferences- 20070928.htm ) Multitasking 73 (www.clickz.com/835391 ) the internet business
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Radio and Television both function based on 25-30 second advertisements. Again here one can already see there is a limitation time-wise, the advertiser has half a minute to deliver a message, inform and convince the viewer. When it comes to radio specifically you rely on one sense audio, again this is limiting because it is so easy to alienate groups. It is incredibly easy to displease an audience, when you can only rely on sound or vision you hope that its pleasant to the audience, one could argue of course that you would know your target group before advertising, this is true to a certain extent, however the psychology is much deeper than the information a demographic can give. Television is an interesting medium for expression, you have audio and vision to your advantage, however your time is so limited that one cannot deliver detailed messages or information. Furthermore because of the ads short runtime one who cannot afford to frequently deliver the ad will find it an extremely harsh (ineffective) and competitive market. The way television ads are presented is also an issue. No matter how creative your advertisement is and how memorable it might be, it is cramped in a 10-25 minute run of a commercial barrage. As soon as the advertisement is finished the next one begins, the viewer is eager to get to the content he/she actually is waiting to watch and is already presenting an unwelcomed attitude.
Internet is an incredibly complex medium as has been shown. When it comes to how an advertiser can express themselves using the internet one must think of design . By design I am referring to the layout of a website, there are thousands of ad run websites, all of which are ‘cannibalized’ 74 by advertisements. There are many creative ways advertisers have come up with to advertise in the internet, most of which do rely however on banners, pop ups and emails. The reader has already read how ineffective and intrusive internet advertisement has been. Some advertisers have understood however, that there are alternatives. Looking at the main reasons why people use the internet, many companies have realized that one should advertise by satisfying people’s wants. Games are one of the main reasons why people surf the internet, entertainment in general, but it is in the form of videogames that many advertisers have found a successful fun and unobtrusive solution to their internet struggles.
- Costs: The table below represents the average costs for advertising in different media. 75 76 The costs vary depending on time slot, colour, and frequency. However the table provides a general range of costs, from minimum up.
Medium Costs (range) Newspaper, magazine $1,000 -$10,000 Radio 25 seconds: $250 -$1,000 Outdoor 16 weeks: $3,000 -$500,000 Internet Banner: $200 -$1,200, CPM: $1 -$5 TV 30 seconds: $200,000 -$3,000,000 Figure 12 Media costs comparison
74 Cannibalized: term used by web designers referring to an unappealing website 75 (www.myadbase.com/cgi-bin/guide.cgi?page=ad_costs ) Advertisement costs 76 (www.iesmallbusiness.com/resources/Major_Media_Types.doc ) Advertisement costs
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Hopefully by consuming the brief information provided the reader can perceive that advertisers are not ideally where they want to be, in fact there is an evident need to explore new ways to advertise, perhaps mass advertising is not the most effective way as it is currently believed, perhaps advertisers need to really focus on their demographics, and understand how their target audience consumes media, most importantly to find a medium where an advertiser can have more feedback both in communication and logistics (reach, frequency, recognition).
Consumers’ resistance to advertising There is a larger problem at hand and it is more sociological than behavioural. As time has gone by, we have all become very accustomed to advertising so much so that they largely do not have an immediate effect on us, they must now be visually striking or shocking to gather honest attention. In fact advertising is so common that it has become bothersome and lately has been found to generally create negative side effects on an advertiser. A study in the US by Yankee-Lovich found the following: “The study found 59% of respondents felt marketing and advertising had very little relevance to them, 64% were concerned about the practices and motives of marketers and advertisers, and 61% felt marketers and advertisers didn’t treat them with respect.” 77 Indeed consumers are becoming weary of advertisers and their practices, and there is no better sign of danger, advertisers must reevaluate their methods and models, concentrate on what an audience wants and when they want it. Furthermore, more emphasis should be given to creativity and exploration, new ways to interact with customers should be explored, creative perhaps even indirect ways of advertising should be considered but most importantly, advertising needs to start creating a positive image of itself again…the following three points are the core reasons to why consumers no longer care for advertising:
They don’t trust them Consumers are no longer as easily fooled by advertising as they once were, especially as new generations have arised. The fact of the matter is that people understand what advertising is, who is behind it and what the purpose of it is. More over we have entered a generation where we have all become advertisers, selling our goods through websites such as ‘Ebay’ and ‘Marktplaats’, we use the same techniques that ordinary advertisers do, and this is the extent to which advertising has become a part of our culture. Only 6% of North Americans believe that companies tell the truth through advertising. 78 The Forrester research group has declared that advertising and company sponsored blogs are the least trusted source of information on products and services while recommendations from friends and online reviews are the highest trusted. 79 Advertisements have had such a negative impact on the consumer’s minds apparently that those who enjoy them view them more as entertainment than for informative usage. Advertisements have gone from providing information to consumers about products to trying to entertain the viewer enough for them to remember the brand, and hopefully then be interested.
77 (www.bandt.com.au/news/9c/0c01ff9c.asp ) Advertising resistance 78 (www.beingpeterkim.com/2007/09/consumers-dont-.html ) No trust in advertising 79 (blogs.forrester.com/groundswell/2008/12/people-dont-tru.html) No trust in advertising
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They don’t want them On a core level, the average consumer does not want advertisements, the research below shows that they are not trusted and largely avoided. In fact this trend has gone as far as having certain businesses accept that advertisements are unwanted and intrusive and selling products just so that the consumer can avoid advertisements . A very good example of this is ‘TIVO’, a largely popular and available product in the US. ‘TIVO’ allows the user to record any content he/she might be interested in without the advertisements; instead of the person watching live streaming, ‘TIVO’ users watch recorded streaming. There are many more products that try to make money by allowing users to skip advertisements, which in a way is declaring defeat to the consumer. Websites are another medium that play on this theme. Many free websites that have a subscription based service promote one of the key benefits of becoming a member as not having to see advertisements throughout the site anymore. 80 Another sign that the advertisement industry has given us, and many have picked up on is the way advertisement time slots are conducted. I have paid close attention to how television advertisements are presented; there is a reason why all advertisements almost seem to happen at exactly the same time throughout all channels no matter how much you channel surf, the reason is to trap the viewer in a desperate attempt to try to force viewership of advertisements. I am sure the reader sees the logic here, if the television networks knew that people were open to advertisements or better yet were receptive of them, the advertisements would be staggered, and there would be many more. This is obviously not the case, time slots are heavily controlled.
They don’t need them Finally the average consumer simply doesn’t need them, it doesn’t seem to have a significant effect on the information they know already, and especially when you consider that the majority don’t trust what they see. Quite simply when we are interested in a product we seek information online, or ask for personal advice, through blogs, review sites even ‘Youtube’ videos. There is of course a percentage of consumers that does trust advertisements or perhaps doesn’t understand the internet to the capacity needed. As time goes by however there will be very few who don’t have access to internet, when this happens and the already significant migration from traditional media increases, how will advertisers adapt to such a sudden sulk?
Luckily for advertisers there are new media evolving around them, and alternative possibilities within traditional media such as internet. Advertisers simply need to update their ways and accept that change in direction is needed, advertising costs are not going down but they are becoming less effective, this trend cannot keep going since logically it negatively affects both parties involved. An emphasis perhaps should be made on specific target group advertising, two way communication, interaction and fun . Almost present the audience with a clean slate to what advertisement is to be, advertisement can be much, much more than simply a tool to create awareness, and for consumers it can be a useful tool to gain important information about a brand, if they are not interested in the brand advertisements should be ‘attractive’ enough to appeal to those who wouldn’t buy your product, but still could provide useful feedback for your brand.
80 (www.ign.com ) Free membership advertisements
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Videogames are a platform that can provide such benefits to advertisers with enough initiative to investigate them. They do have their drawbacks, but on the other hand they represent a different side of advertisement that is fresh and unique, and one that people can get behind. From here on end videogames will be in the looking glass, with all relevant information given for the reader to determine whether videogames are a viable platform for advertising considering what has been discussed in the thesis this far. 3.4 Stake holders
In this section I present which parties would be affected by advertising in videogames and how. It is a rather complicated aspect to present, considering the different models advertisers can use when it comes to videogames. It is interesting to openly see who is affected by this movement in advertising; it provides a sober look at who is involved. Also it introduces the reader to the scale of advertising in videogames, it is important to know who ends up being affected. I must express that this section does not focus on positive vs. negative effects that will be talked in a later chapter, this simply shows the blueprint and communication flow.
1 Advertiser/company 3
2
Videogame advertising agency
2
Videogame publisher Videogame developer 1, 2
1, 2
3 Gamer/audience
Figure 13 Communication flow
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Diagram explanation As the reader can see, the diagram above shows the parties involved when advertising in videogames, not all parties have to be involved, hence I placed numbers, which represent the different routes an advertiser can take. The diagram also shows the communication flow in form of the black arrows, these show the negotiations that need to take place for the advertisement to finally reach the intended audience. I recommend the reader to remember this diagram for the coming chapters where details of advertising within games will be given, such as the different models an advertiser can use to advertise in videogames. If anything is unclear now it will all fall together in the coming pages. Now I will explain the various routes:
1. The first option an advertiser can take is to directly contact a videogame publisher. This can be done with the big publishers such as EA, 81 Activision-Blizzard 82 and Take2. 83 The publishers will then start talks with the game developers to see where the advertisement would fit, perhaps the game developer really sees no fit, it really depends on the relationship the publisher has with their development studios and the kind of advertising wanted to be done. This approach is best suited to those advertisers who know exactly in what videogame they want to advertise, and specifically games for the console and pc platforms since these are the ones that really need publishers to support the massive games they have to deliver. Quite simply publishers act as record labels do in the music industry. They provide marketing, budgets, distribution and sales.
The game developer will then come back to the publisher with the possibilities, who will then come back to the advertiser so the circle is completed, and redone as many times as necessary. Finally the game is released and audiences exposed to the advertisement. The gamer doesn’t have any involvement in the development stages of most games hence have no involvement in whether advertisements are implemented or not.
2. The process is quite similar to the one above, however in this case there is another party involved. The new party is agencies that establish themselves in between the advertisers and the publishers. Their job is quite simply to find the best suitable game for the advertisement to be in. They are in charge of everything, of course this costs money; they are agents. Such agencies are ‘IGA’ 84 and ‘Double Fusion’. 85 These agents are experts in videogames and their audiences, they best quality is that they will find the most natural fit for an advertiser, one which connects with the crowd. The final step is the same as with route 1.
3. The final possibility is the most direct one and one of the most popular and effective overall. This route is directly tied to one of the advertising models I will describe later on. Essentially the advertiser directly controls the advertisement in the game by creating the ‘videogame’ themselves. This can be done by hiring game developers be it
81 (www. ea .com ) videogame publisher 82 (www. activisionblizzard .com ) videogame publisher 83 (www. take2 games.com ) videogame publisher 84 (www. iga worldwide.com ) Videogame advertisement agency 85 (www. doublefusion .com ) Videogame advertisement agency
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freelance programmers or actual videogame developer houses, there are even specialized videogame developers now that specialize in creating branded videogames, or as the industry refers to as ‘advergames’ 86 . In this case the advertiser or company can directly create the experience they want, and create a videogame that communicates exactly what they want to deliver. Another way of going down this route is to develop a videogame ‘in-house’, many companies such as ‘Mitsubishi’ and ‘kellogs’87 have done this. Usually the end videogame is not released in a physical form that would require a whole distribution chain etc…most of the games created in this fashion are released digitally be it on the internet or online through the consoles and PC. In the end it is up to the advertiser or company to decide on all aspects of the videogame, whether they want to bring profit from it, deliver it for free, make gamers register before playing, register after playing, prizes, feedback etc…the product is finally released to the public, in this case however the audience does have a chance to communicate back, that is if the advertiser whishes to implement that possibility.
It is a very diverse option one that has proven to be very successful for some brands, however all routes have their own advantages and disadvantages, the most important issue in the end is which model of advertising to use when thinking about using videogames.
Now the reader has a simple but solid overview on which parties are involved in videogame advertising and to some extent how they are affected. In the coming chapters this thesis focuses in detail on videogames as a platform, filling in all the gaps and questions an advertiser might have on this medium. All the information given this far helps to create a logical information basis to why advertisers need to explore new alternatives now one will see why videogames could be an interesting venture.
86 (www.littlechicken.nl ) advergaming developer 87 (www.applejacks.com/#/intro ) Kellogs videogame
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4. Videogames as an advertising vehicle
In this chapter a look at videogames themselves as a medium is given, making a nice introduction to the last chapter of this thesis, which only focuses on advertising in videogames. The goal of this chapter is to introduce the reader to what makes videogames a very interesting platform in itself, and how distinctive they are from their competing media. 4.1Understanding videogames as a medium
Videogames first and foremost are an entertainment form, however many also consider it as an art form quite similarly to music and film. As seen in chapter 2 videogames have grown up substantially and encouraged many to try them out, as a result a large percentage of the population is very aware of videogames and most devote hours of their weekly time to them. For an advertiser it is essential to understand what makes a videogame, the core pillars that make a videogame what they are, it is only after understanding these pillars and how they are different to other media that an advertiser can begin to comprehend the possibilities and creative solutions available to reach target groups.
Audio, Visual, Interactive A videogame is precisely composed of audio, visual and interactive elements. When these three combine a videogame is created. For many years it took a while for people to grasp the interactive side of videogames, but the introduction of simple games made it possible for the general audience to become part of the community. As time went by games became very complex, controllers currently are designed to use both hands and almost every finger, ‘Nintendo’ went in a different direction this current generation by introducing the ‘Wii’ with it’s casual games and very simple controls. The pc has it’s mouse which is generally used for all internet games making it the most intuitive controller, while the newcomer ‘I-phone’ brings its touch screen to new levels of user friendliness.
Figure 14 From controllers from left to right: Xbox, Wii, PC Mouse
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It is important to understand how people control the games, because it is one of the most demanding aspects of videogame design. 88 Your audience must be comfortable with how they interact with the videogame. It is the interaction that makes this medium stand out, and for an advertiser this is the aspect that benefits them the most, the possibilities have automatically extended from that of other mediums. Videogames have now become one of the most powerful tools of entertainment and expression. A magazine can be visually appealing; a podcast entertaining to listen to and a film can mix both. It is only videogames however that manage to mix all these senses with interactivity. In the next sub-chapter I go deeper into what separates videogames from other media, there the reader can see more clearly what the benefits of videogames as a medium are.
Finally videogames are always at the cutting edge of technology while at the same time casually available to anyone who can’t afford or simply isn’t interested to play the most demanding games. Videogames can be anything from 5 minutes long to never ending, they can be free or rather expensive and for those who really want to push entertainment to the limit there is plenty for them as well. A good example of this is the introduction of ‘Blu-rays’; these were introduced as a new format for the ‘Playstation 3’. The key aspect of ‘Blu-ray’ disks is the large capacity they hold. Disk space is very important for all entertainment mediums; it dictates how much you can give a consumer essentially and at what quality. For example DVD’s have a maximum of 9 gigabytes to store information; every movie comes in this form. ‘Blu-rays’ on the other hand have a capacity of 50 Gigabytes. 89 For the developer this means much more space to work with, better uncompressed audio and visuals, longer games or movies and high definition. For the consumer this means much better quality, at a higher price however. On the other side of the spectrum gamers can play on the internet, with simple flash 90 based games in their web browsers for free, these are ideal for short casual games. As an advertiser what is important to take from this is that videogames cover a large basis, and no matter what your budget or target groups are, there is a way to reach them, but interaction is key; it is what separates games from other medium; one cannot simply create a slideshow and call it a videogame.
Why do people play videogames? People do play videogames for entertainment primarily, although it can be argued that as of late many organizations have realized that videogames can have a much wider range of use. Schools in Britain and Japan have started developing courses that use the ‘DS’ to teach children. 91 Why? Simply because they have found out that there is a way to make learning fun. Companies have begun to do the same with their employees, to train and develop skills through videogames, such as teamwork. The army in fact has always spent millions annually in army simulation games, later to release to the public in occasion. 92 Though this is a very interesting topic, it is not relevant to this thesis unfortunately, but would be interesting for a future thesis or research.
88 (www.linuxjournal.com/article/2262 ) Game controls 89 (www.blu-ray.com/faq/ ) Blu-ray information 90 Flash: a simple programming tool 91 (www.techradar.com/news/gaming/handhelds/nintendo-scores-big-ds-win-in-primary-schools-585167 ) DS in schools 92 (www.stripes.com/article.asp?section=104&article=59009 ) Army invests in videogames
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People look for entertainment in videogames for the following reasons 93 :
1. Competition : The very nature of competition is entertaining to some, in the form of videogames it comes in many forms. Games that provide competition are usually online ‘multiplayer’ games such as: ‘Call of duty’94 and ‘left 4 dead’95 . In both games you compete to get a higher score then the opposite team. It is in our nature to be competitive and try to reach the highest possible rank, many games now offer competitive options but also including teamwork to bring positive competition out of people, who must cooperate to achieve a common goal.
Figure 15 Empire: total war, players must battle against each other during the 18th century 2. Challenge: Many gamers simply play for the joy of pushing forward whether it is a series of puzzles, a storyline or obstacles. Challenge can be found in almost every videogame, it is only recently that developers have experimented with taking challenge away from videogames. Videogames as an interactive entertainment form relies on challenge to keep players engaged and moving forward. ‘Flower’ however a ‘Playstation 3’ title has no challenge whatsoever, it was created to make a player feel relaxed. The goal of the game is to collect flower petals throughout a beautifully rendered playing field. Even casual games rely on challenge, players no matter how inexperienced they are quickly adapt to a game and the rules of the game, to get more out of it developers have understood that challenge adds overall value to a package.
Figure 16 World of goo, one must go from A-B connecting blobs
93 (Marolf 2006, Advergaming and in-game advertising. p.12-13) Reasons why people play games 94 (www.callofduty.com ) Competitive game 95 (www.l4d.com/home.php ) Competitive game
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3. Social interaction: This aspect heavily applies to multiplayer games and to a large extent ‘mmo’s (massive multiplayer games). It is in these games that hundreds and in the game of ‘world of warcraft’96 11 million players play together and interact with one another. They must interact with one another to move along and complete challenges. This aspect of gaming has seen a tremendous boost in the past couple of years, with Chinese developers developing free online worlds for the Asian market with estimated 50 million players already registering. 97 Then there are of course virtual worlds such as ‘second life’98 where there is no ‘game’ it is simply a community world where people meet each other and create their own ‘ second life’. The attraction of social interaction is just as with facebook and other social networks. Games however allow you to take it to a new more intense level, where you can create your own character, you talk to who you like and you share activities with others.
Figure 17 Second life, a social interaction focused game 4. Diversion: Another reason why people play is simply to spend a few spare minutes of their time to get away from other things, or simply boredom. This is an aspect that honestly many other media share. However videogames do offer a wide range of casual games for those seeking to entertain themselves briefly. Handheld systems like the ‘DS’ or even the internet are the best platforms to satisfy this need. There are literally thousands of small games on the internet to be found such as in portals like ‘newgrounds’.99
Figure 18 Solitaire, a casual low engaging game
96 (www. worldofwarcraft .com ) MMO 97 (ListenUP podcast – February) 98 (www. secondlife .com ) Social game 99 (www.newgrounds.com ) casual games
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5. Fantasy: This is one of the most influential and characteristic aspects of videogames that people are attracted to. Simply videogames allow the gamer to be the hero, or if he wishes, to be the villain, to be the heavyweight champion in boxing, the general of a massive army, an Italian plumber, or even be someone famous. Videogames allow the player to experience something completely different, become someone who he/she is not and as with film, experience very deep and diverse fantasies. The platforms best suited to deliver these deep and rich experiences are the ‘Xbox 360’, ‘Playstation 3’ and ‘PC’. Simply because they have the raw power and tools for developers to really create a world and setting that can almost fool people for a few moments. The possibility to experience what one cannot in real life is a big attraction to many. Videogames can deliver on this like no other medium, because of interaction .
Figure 19 Fight night 4, boxing simulation game 6. Arousal: The final reason why people play videogames is simply excitement. Many when faced with a game sense adrenaline and emotions that they do in real life when doing sport, arguing, relaxing etc. Interaction and this generation’s technology have made it even more so. For example games based on simulation have proven to be very deep and provocative to our emotions. Flight simulations are almost pinpoint accurate, driving games and even some horror titles are so well produced that the player is sucked into the experience to the extent where it generates feelings and emotional reactions. Such a game can be for example ‘burnout paradise’100 a racing game but one which is incredibly fast, and an accident translates to a dramatic but very accurate crash animation.
Figure 20 Burnout paradise, a fast and exciting driving game
100 (www.criteriongames.com/ burnout /paradise ) Exciting game
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It is important for advertisers to understand these reasons for when choosing what game to advertise in or what game to develop. One must know what their target group is looking for in videogames. Knowing this greatly increases the percentage of natural advertisement integration making the experience for both the game and advertiser more beneficial. 4.2What separates videogames from other forms of media
This section faces videogames in comparison to other advertisement media. There are key distinctions that separate videogames from other media as an advertisement form. Firstly however this would be a great place to compare how the limitations that other media face relate to videogames (as done in chapter 3). And finally a list of distinctive points is given to round up this sub chapter.
Traditional medium limitations, compared to videogames Previously I explained common limitations that traditional media present to advertisers, in this case however the same points are used with videogames:
- Reach vs. frequency : As mentioned previously reach and frequency are incredibly important to advertisers, success and failure depends largely on the estimated numbers of viewers and how often they are exposed to them. The big issue has always been, how can you be sure that an audience is paying attention to your advertisement? Or, are they even watching? When it comes to videogames it is true that they do not have the raw mass reach potential that television does for example. Videogames do have however one very important advantage; interactivity. Because the player is controlling the game he must be looking at the screen, currently there is no videogame that functions to such a level where a user can be multitasking. Indeed as an advertiser your estimations are much more balanced and logically accurate. If an advertiser chooses to place an ad in the next big title, based on sales the advertiser can know in the very least the minimum reach; however one must consider that 69% of games are played with at least one other person watching. When it comes to frequency it is really hard to place a clear picture since videogames can really take many forms. However whatever game the advertiser chooses to advertise on, a calculation can be made based on overall game play hours, replay value and advertisement placement. Any developer apart from the Wii can tell the advertiser how many hours the game has been played at any moment.
Hence when it comes to reach it is much easier to determine the actual facts, with frequency it is also relatively easy to know how many times someone has been exposed to the ad, but it really depends on the advertisement and on what platform it is on. One must also consider that apart from casual games on internet browsers, consumers spend a large amount of money on games, they are not a cheap product, and hence the chances of someone buying a videogame to never touch it is highly unlikely. Do people remember ads in videogames? We now logically know that they actively see the advertisement, and a smart advertiser will make sure that there are frequent reminders of the brand in throughout the game, but after playing the game, perhaps several months later, can an ordinary person remember what ads where in
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the game? When it comes to games developed by the advertisers themselves this is a non issue, because the game is an advertisement (as will be explained later), however when advertising within a videogame on other platforms, especially games that last hours and engage the player in many ways, one would think that the average person would forget about the advertisement by the end of the game. Traditional media largely fail in this aspect as shown in chapter 3 with the ‘Superbowl’ example. It seems as though videogames also fair well in this aspect, although there is no complete research done on this area, there are some example that can at least suggest that not only are brands highly recalled in videogames but that a favorable impression is left in the minds of the consumer. An experiment done by ‘Frank Magid Associates’ used a brand on both a prototype TV advertisement and an advertisement in a casual game, then asked 2,000 viewers if they could recall which brand was advertised. The results showed “a 5x increase in unaided brand awareness over TV advertising” 101 , furthermore “56% had a more favorable impression”. Another study on positive feedback was conducted by ‘IGA-Nielson’ on 1,300 gamers. 82% of the gamers reacted positively to receiving in-game ads during gameplay. 102 Finally I will close this section by providing a personal example one that was spontaneously conducted to personally see if these results could be true. During the summer of 2008 I was playing a videogame called ‘Metalgear Solid 4’, this game has several ‘Apple’ products such as the ‘I-pod’ and the ‘Macbook’, both of which can be seen from start to finish throughout the game. While playing this game my girlfriend, father and mother occasionally would watch, considering this was several months ago and coincidentally I decided to ask for arguments sake: do you remember any form of advertising in that game? All responded with ‘Apple’, the brand. This was not a scientific test and one that probably shouldn’t be held as an example, however I found it extremely interesting, the only thing they remember about that videogame was the ‘Apple’ products, now it ironically makes sense. To an average person or someone casually watching the game, they cannot relate to the story, the setting the characters it is all fictitious however brands are real, they could relate to that, and probably that is what has happened, they remembered what they could connect with.
Figure 21 Ipod in Metalgear Solid 4
101 (www.techcrunch.com/2009/03/24/study-in-game-video-advertising-trumps-tv-advertising-in- effectiveness ) advertisement recall in games 102 ( www.kotaku.com/5017142/iga-study-finds-people-dont-mind-in+game-ads ) Positive feedback on in-game advertising
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- Casual usage : There are casual games and there are enthusiast games that require hours of dedication from the player. Regardless game play time is not casual it is intense and requires all senses from the player. The hands are busy controlling the game, the eyes are busy coordinating the actions and even sound provides game play value. Needless to say there is no room for multitasking, perhaps one could assume that casual games such as solitaire, minesweeper and many internet browser games can be played while doing other things, this is to a certain extent a valid point. The difference is that whenever the user is paying attention to the game, he must physically act, to play the game, to move further.
- Expressiveness : This is the one aspect that advertisers should be most excited about and one that other media cannot simply provide advertisers. That is the ability to deliver a brand experience. Never before has it been possible to an average person to test a product at home and experience its qualities. Brands can express themselves with only creativity being their limitation. For example videogames can be a great platform for delivering a brand image or key messages that one would want their target groups to remember and experience. ‘Kellogs’ ‘fruity loop’s’ cereal released a small casual game on a limited time period in their cereal boxes. The game saw the player as an individual while different food such as fruits were dropping down; each item has a different score value, fruity loops having the highest score . This is delivering a message to the gamer, to always try to get the fruity loops; they are better and more valuable. When the advertisement period finished, the popularity of fruity loops compared to other cereals nearly doubled with children. 103 The ability to allow the user to interact with an advertisement is incredibly effective both psychologically and socially. A more elaborate example of how brand added value can be achieved through videogames possibilities is ‘Sony Ericsson’ and their in-game advertisement of the ‘T637’ phone in the videogame: ‘Splinter cell: Pandora tomorrow’. In this game you play as a secret agent for the US government, ‘Sony Ericsson’ made a deal with the publisher of the game to integrate the phone in the game, so that the gamer could become accustomed to the phone and its abilities. Indeed throughout the whole game the phone is a key asset to the adventure, it is used to take pictures, read messages etc. Players needed to become familiar with the phone to progress through the game, studies showed that players did not even consider this as a paid advertisement because it was so naturally implemented! 104 As the reader can see, the target group gets familiar in a digital world with the product the advertiser is trying to sell, they can spend hours playing with the product, but the advertiser controls the game. Many more examples can be given, however the point is clearly made, as an expressive tool it can prove to be very valuable to an advertiser to familiarize customers with products or any aspect of a brand. Of course the danger lies in a bad advertisement, one that doesn’t naturally fit or even worse annoys the player. These issues will be touched upon in their relevant sections however.
103 (David Edery, Ethan Mollick 2008, Changing the game . p.57-58) 104 (David Edery, Ethan Mollick 2008, Changing the game . p.40)
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Figure 22 Splinter cell's Sony Ericsson phone
- Costs : When discussing costs in this field, one quickly realizes that there are no fixed models. Perhaps this is another sign to how under discovered this medium is, that there are no predetermined costs for advertising in videogames. Nonetheless there are estimations and logical numbers that can be shown, one must take into account that there are many different ways to advertise using videogames; it is technically one of the most diverse mediums available. It is not such as TV that an advertiser gets ‘slots’ or in a magazine gets ‘pages’, in videogames, one can really advertise in a small and subtle way, or can go as far as to creating a videogame themselves and spending millions. There is a place and a budget for different needs, which needless to say should be something attractive for any marketer.
Estimated costs for advertising within games 105 106 Average costs for advertising in a videogame : Average costs for developing a branded game $5,000-$2,000,000 (advergame): $0-$750,000
These are estimates; the margins really depend on the sort of advertising wanted/needed. I must express that costs for advertising in games is rising; this is largely due to the rise in demand to reach a younger audience. A big issue for advertisers lately has been how to reach the youth; they have proven to be very unapproachable and usually multitasking. Many advertisers have started to spend money on in-game advertisement because the younger audiences are playing videogames over other media, and when they play they spend hours a week on it. 107 David Walsh president and founder of the ‘national institute on media’ said in 2006 “Advertisers follow eyeballs, and young eyeballs are now on video games”. As shown in several cases before, viewership of other media has gone down exceptionally, while that of videogames has risen. When it comes to costs, videogames as a venue are still a very cost effective alternative, however advertisers must take notice that if this keeps becoming a successful and growing industry costs will rise. The costs expressed in the table are estimations based on what advertisers have spent so far on
105 (David Edery, Ethan Mollick 2008, Changing the game . p.55) 106 (www.adverlab.blogspot.com/2005/12/study-ads-in-video-games-drive.html ) Costs for advertising 107 (www.boston.com/business/personaltech/articles/2005/12/05/video_game_ads_work_study_says/?page=f ull ) About advertising in games
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advertising; it is actually possible to spend $0 in creating a videogame to promote a brand or product. As shown in chapter 2 of this thesis anyone can create a game for the ‘I-phone’ or the internet browser using free programming tools, then to be released for free or at a price. It can be incredibly successful or useless; it all comes down to the videogame.
Other benefits that videogames have over other media are:
- Two way communication: This is the only medium where indirectly or directly an advertiser can gather valuable information about their target group. Through a videogame one can at all times see what the gamer is doing, gather their information, and most importantly get real time feedback. A basic example of this is, making it possible for the gamer to buy an advertisers product directly after finishing the game by just pressing a button. - Time Availability: Unlike TV and other platforms, many forms of videogames do not have availability slots. Once they are on the internet or in any of the consoles they are there for the long run, unless of course the game is pulled down. For an advertiser (depending on the advertisement) this means long run frequency and reach. There have been many cases where through viral means a simple videogame has been spread across the internet and played by hundreds and thousands of gamers. 108 - Fun : A logical but largely unappreciated aspect. Playing games is fun, if an advertiser can provide a fun experience for the audience the potential for advertisement recall and a positive view of the brand greatly increases. For the first time, in a culture where advertisements are increasingly more intrusive, direct and impersonal there is a platform that gives advertisers the creative possibilities to make them fun again. Perhaps even more importantly, not even seem like advertisements!
These are a few but very important characteristics that separate videogames from other media, the last few aspects discussed will be implemented in chapter 5, providing the reader with a richer overview in how all these aspects fit within the models advertisers would have to use to advertise in videogames. In the coming pages, the reader will see what gamers expect from videogames, and why some advertisers have stayed on the fence on whether or not to use this medium.
108 (www.adverblog.com/archives/002608.htm ) successful advergames
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4.3What has held back advertisers from this medium?
Advertising in videogames actually isn’t such a new practice, since the late 80’s and during the 90’s some companies ventured into videogames, trying to advertise in this medium. Actually the truth is, videogame developers and publishers paid companies to implement their brands in their videogames, a clear sign the medium was not considered successful or impactful enough to be useful. The only form of advertising at the time was ‘in-game’, where a brand would be shown in a static form, through a poster, billboard etc. ‘Red bull’ was one of the first brands to use videogames as an advertisement platform in the game: ‘Wipeout 2097’109 . The advertisement came in the form of billboards placed around the levels. Being a racing game, the billboards were hard to miss, however in this case this was a bad advertisement, a sign that neither the videogame industry nor advertisers knew how to make things work in this platform. The advertisement was ineffective because it was a blatantly obvious advertisement. The game takes place in a futuristic setting, one not based in any realistic setting…apart from ‘red bull’. Gamers got irritated. 110 Times have changed however where once videogame publishers were doing what they could to attract/pay advertisers even if just to make their games more realistic, now advertisers are quickly warming up to the idea of advertising in games, many are testing the waters, by superficially trying the platform out, needless to say the numbers show that videogames as a platform has not gone unnoticed. In 2004 $120 million was spent on videogame advertisements in the US, this year (2009) it was expected to surpass $800 million 111 though 2008 has already seen these numbers. A more accurate estimate for 2009 is for over $1 billion in the US, or $2.5 billion worldwide being spent on advertising in videogame by 2010-2011. 112
What has prevented advertisers from using this medium? It has taken many years however for advertisers to start accepting videogames as an advertisement form; in fact even now compared to other media the expenditure is minimalistic, with many companies spending many times more on their own advertising budgets. There have historically been barriers that have prevented advertisers from effectively using videogames, many of which are related to a young industry:
1. Videogame target audience: It was not until the internet caught on and the ‘Wii’ introduced the mainstream to videogames that the core target audience of gamers expanded. Videogames where once primarily focused on male teenagers, a very small demographic also in numbers. As an advertiser several years ago looking into advertising in games meant having a product that fits the small demographic. It simply didn’t have the appeal that other media have, which were largely more used and by all.
109 (Marolf 2006, Advergaming and in-game advertising. p.104) 110 (Marolf 2006, Advergaming and in-game advertising. p.105) 111 (www.gamedeveloper.digitalmedianet.com/articles/viewarticle.jsp?id=31947 ) Rise in videogame ads 112 (www.atelier-us.com/advertising-and-marketing/article/In-game-advertising-could-be-a-1-billion-market- by-2010 ) Estimated expenditure in videogame advertisements
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2. Unpopularity/image: The image videogames had and to a smaller extent still have within some groups, is that of an unhealthy form of entertainment, one that directly connects to the so called ‘nerd’ subculture. Many brands did not want to be associated with this image. Not to mention that during the mid 80’s the videogame industry went through a ‘crash’ phase. As mentioned in the introduction of the second chapter, there was a time when videogames were oversaturated, and unfortunately in a negative way, the quality wasn’t there and many were turned away by that. It took a while for videogames to rebrand and organize themselves again.
3. Unaware culture: Videogames were largely ignored by the mainstream and commercial venues, they were rarely discussed, journalists didn’t mind them much attention, they were simply regarded as a toy and perhaps the industry intended it to be as such in the early years. As with the internet, when it was first created, it wasn’t uncommon for many not to have email, not know what ‘www’ meant or even what the internet was meant to be. It took a while for the industry to catch on and get attention.
4. Programming difficulty: It was not until this generation that programming for games has started becoming more flexible and user friendly. For the vast majority of the industries live, the tools to create games were complex, it required experts to create them and time. For advertisers this would have meant having to plan the advertisement to be in the game when development started, meaning that no spontaneous advertisements were possible or most importantly time specific advertisements or campaigns would be impossible. If the game would face a delay the advertisement could be jeopardized. Furthermore implementing an ad in a videogame years ago would only be possible in a very static way, a low resolution picture for example.
5. Lack of possibilities: As mentioned above, the possibilities of advertising in a game were very limited, the technology was so young and un-mastered that in the best cases an advertiser could place an image, this image would be distorted and extremely simple. There was no such thing as a company developing their own game therefore the only possibility was to advertise in already existing games.
6. Other media: Currently traditional media is quickly leading way to new media such as internet, social media and videogames however this was not the case a few years ago. TV, print and radio were extremely effective for advertisers, many still look at these media the same way, which has lead to billions of dollars on ineffective advertising. At the time however videogames could not possibly compete with other standardized media, they had massive ratings and positive exposure, consumers where paying a lot more attention, the young generation was intrigued with Television and advertisers could balance the costs with the aftermath.
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5. Possibilities of advertising in videogames
This final chapter concentrates on the actual practice of advertising in videogames; the different models that can be used, alternative possibilities, the variables one should consider when advertising filled with examples of real events to finally round up the thesis’s hypothesis. 5.1Gamer types and how their consumer behavior varies
This section focuses on the gamers that represent the audience that plays videogames, it is a necessary topic to discuss simply because as an advertiser you would have to know, what types of gamers there are and how they differentiate from each other. Based on this knowledge the advertiser can more carefully plan how they want to reach their target audience if they decide that videogames are a sound platform to use. Obviously cultural backgrounds affect how gamers consume videogames to a certain extent however the core factors do not alter, hence cultural effects become rather irrelevant for this particular thesis.
There are two types of gamers, it might not seem like a big division, but their differences are sound and their consumer behaviour is very different from each others. The two types of gamers are ‘Casual’ and ‘enthusiast’. For this cause I have interviewed two individuals that clearly represent both sides of the spectrum (the interviews can be found in the appendix). This section focuses primarily on the behavioural characteristics of the target groups.
The enthusiast gamer The enthusiast gamer is the most grounded and involved form of gamer in the industry. They traditionally represented the vast majority of gamers, though now the tables have quickly turned with the introduction of the ‘casual’ market. An enthusiast gamer is someone that follows the industry, is very supportive and regards games as an integrated part of their lives. Martijn Wieriks the enthusiast gamer I interviewed has been playing games since the mid 80’s, spending an average of 15 hours a week playing a wide selection of games. Enthusiast gamers are also known as ‘hardcore’ gamers 113 because they are very passionate about the medium; they have generally been playing games for over a decade, and own quite a number of console systems. For example Martijn owns: ‘Pc’, ‘Wii’, ‘Xbox 360’, ‘DS’ and older systems such as ‘Nintendo 64’, ‘NES’, ‘Playstation 1’ and ‘Xbox’. By simply looking at the hardware he owns, you can already see this is an individual that has been playing games for several years, there are videogame systems in his collection that range from the 80’s to our current date. Though Martijn may seem to spend a large amount of hours on games a week (15) it is not a surprising figure, I myself am also considered an enthusiast gamer, and share many of the characteristics with this interviewee, I spend approximately 14 hours a week playing videogames, this completely relates to the type of games we play (this will be explained in the following sub chapter), there are gamers, especially those playing multiplayer only games that spend as much time playing games as they do working, that is 20+ hours.
The spending behavior of an enthusiast gamer is hard to pinpoint, Martijn spends around 300 Euros a year on software though many spend thousands of Euros. Enthusiast gamers generally
113 (www.epinions.com/content_3151863940 ) gamer types
~ 51 ~ have more than one system to play games on. The most expensive purchases for a gamer is usually the hardware. Enthusiast gamers are generally very open about videogames, they know what they like and what type of games they prefer but they are open to all genres. Most enthusiast gamers play games that have high production values, cost more, require knowledge and skill from the player and can take an average of 8+ hours to complete. For advertisers this is important information, knowing what your target audience plays automatically narrows the possible videogames to use for advertising.
Enthusiast gamers still consist primarily of males between the ages of 14-34 114 . They are an incredibly important audience for the videogame industry, especially for the more advanced videogame platforms such as the ‘Xbox 360’, the ‘Playstation 3’ and PC these systems were created for the enthusiast gamers, they are the only hardware capable of satisfying their needs. Unfortunately the enthusiast gamer is so in touch with technology that piracy is a trivial and easy aspect for many of them, the most pirated games are always those games designed for the enthusiast gamer. Pc is the platform that sees the most impact, for example ‘Crysis’ a shooting game developed for the PC was pirated close to 1,000,000 times, 115 with just over 1,000,000 copies being sold legally. 116 That is almost half the gamers pirating the game. Ironically however, though this is sad news for the videogame industry, for an advertiser it is far from negative. If a game with advertisement is pirated, the exposure is still there, and it can be tracked down. It is a sad reality that while some suffer business wise, another party can take advantage and even advertise on the PC for cheaper with the excuse that most games will be pirated.
Finally enthusiast gamers are a community, the vast majority of videogame websites are targeted at the enthusiast gamer, reviews, message boards these are part of an enthusiast gamer’s hobby. In fact enthusiast gamers have such a strong community that they can make or break franchises. 117 For instance when an enthusiast game is well reviewed and accepted by the community many games that follow share the advantages of that successful franchise. With casual games this is not the case.
The casual gamer The casual gamer and market are the success story of this generation for the videogame industry. A casual gamer is one that enjoys videogames leisurely and for short periods of time. In contrast with the enthusiast gamer they do not need expensive blockbuster games that provide entertainment for months, they seek entertainment from games in a more superficial and quickly satisfying way. My casual gamer interviewee, Muriel Philippi has been casually playing games since the 90’s but it wasn’t until the ‘Wii’ that she really considered herself a gamer. She spends an average of 8 hours a week playing the ‘Wii’ with her boyfriend for sessions of 30-60 minutes. Already the reader can see there is a division regarding the dedication both target groups show. In fact there are millions of gamers like Muriel, as shown in early chapters the ‘Wii’ and casual games in general have skyrocketed in sales and audience. It is a fact that within the coming two years the casual gamer will represent the
114 (www.megagames.com/hardcoregamer.html ) Enthusiast gamers 115 (www.torrentfreak.com/top-10-most-pirated-games-of-2008-081204) Most pirated games of 2008 116 (www.tomshardware.co.uk/forum/page-99063_25_0.html ) Crysis sales 117 (www.cinemablend.com/games/Casual-Gamers-Vs-Hardcore-Gamers-Round-2-12857.html ) Casual vs. Hardcore gamers
~ 52 ~ majority of the videogame target group. Casual gamers are represented by a 52% female demographic 118 . Though the casual gamer doesn’t spend as many hours playing games on average as the enthusiast gamer they do have the numbers to impress. The Wii is doing remarkably well, however many forget the more implemented forms of casual games, the internet and phones. 150 million peoples constantly play free casual games on the internet. 119 The ‘I-phone’ is largely successful because of its free applications, with thousands being published weekly, over 6000 of which are games, ‘I-phone’ games represent the largest category of applications and 23.1% of all application downloads.120 The casual market is big and it isn’t slowing down. For an advertiser the casual gamer represents quite a large percentage of the mass audience typically advertised to. Games have now simply found their way into the mass audience’s lives.
Casual gamers have largely been attracted to these games because they are typically free or relatively cheap. Casual gamers such as Muriel seek ‘feel-good’, fun and light games. Luckily for developers these games are easy to make and cost effective a large reason why there are more casual games in general than those for enthusiast gamers. One would assume that casual gamers spend less money on videogames than enthusiast gamers and that would be a dangerous assumption. The ‘Wii’ is the cheapest console and internet is largely implemented in most households, however casual gamers have no problem when it comes to buying casual games. Muriel for example in 2008 spent around 600 Euros on the ‘Wii’ and games. For example the ‘Wii fit’ goes for sale at 80-90 Euros, in reality it is a glorified scale, it measures pressure and weight, the game consists of a series of exercises that could in all truth be done with a household scale. Nonetheless the game has consistently sold out and reached top monthly sales. ‘Wii fit’ has sold over 3.5 million units in 2008 alone. ‘Wii’ games in general sell more than other systems, the casual gamer generally seems to spend more money on software, perhaps however it is a sign that there is a shift in the gamer demographic and we are seeing a huge increase in the casual vs. enthusiast ratio. Advertisers can see at least the potential there is in targeting the casual gamer, they look for simple entertainment and do not hold back on spending money, on the other hand enthusiast gamers might be a smaller audience but they play their games for many more hours. Both have differences, summarized in the table below.
Table showing differences
Behavioural factors Enthusiast Gamer Casual Gamer Hours gaming (a week) 14+ 5+ Expenditure (a month) +/ - 100 Euros +/ - 50 Euros Most appealing platforms PC, Playstation 3, Xbox 360 , Internet, Wii, DS PSP Appealing genre of game Action, simulation, Puzzles, Sports, Adventure Adventure, Survival horror, RPG Figure 23 Differences between enthusiast and casual gamers
118 (David Edery, Ethan Mollick 2008, Changing the game . p.8) 119 (David Edery, Ethan Mollick 2008, Changing the game . p.8) 120 (www.fiercemobilecontent.com/story/iphone-applications-top-25-000-led-mobile-games/2009-03-09 ) I- phone games
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This section provided a look at the two different gamer types that advertisers would ultimately have to target. Many gamers are identified by the games they play however, the game types are directly related to the gamer types. For an advertiser to truly get the overall picture of the videogame demographics they must understand the core game types. It is within these game types that an advertiser would have to work to reach their audience, hence the importance is undeniable. Understanding the gamer type you are trying to approach give you an idea of what gaming they are looking for, one can directly connect the dots and essentially fit the game with the gamer, and find the best videogame to advertise on. 5.2Game types and how they relate to target groups
As with gamer types, the videogames themselves can also be categorized in the enthusiast and casual sections. In a superficial level, since within these two categories games can be classified further, not simply by genre that is too trivial and ultimately up to the advertiser, rather by the core concept of the game. However first a look at enthusiast and casual games is provided:
Enthusiast games Enthusiast games are naturally what enthusiast gamers are after. The reason videogames are divided the same way as gamers is because they share very similar characteristics and aspects that directly correlate to their counterparts. Enthusiast games generally involve intricate plotlines, complex game play and require a rather large amount of hours to complete. Enthusiast games are not easy to ‘pick up and play’, they generally require a gamer that is already accustomed to complex controls, quick reactions and will to be challenged in some cases with tough difficulty compared to other games.
Enthusiast games take from $5-$100 million to develop, almost mirroring costs of big budget movies 121 . As a result they usually cost more than casual games, a typical enthusiast game for the ‘Playstation 3’ or ‘Xbox 360’ retails for 55$-70$. 122 The games themselves can also take up to four years to develop. Enthusiast games represent the typical image that the mass audience has of videogames; the fast paced violent shooter, the incredibly realistic driving game, the highly competitive strategy game that requires almost scientific knowledge of all aspects of the game etc…
Casual Games On the other side of the spectrum, casual games are very simplistic and very ‘pick up and play’, anyone should be able to approach a casual game with no prior knowledge and play for several minutes. Casual games are usually targeted to a neutral friendly audience, keeping things open to all audiences and skill levels. They can take anything from five minutes to two hours to complete although in some cases such as ‘Wii Sports’ there is no end to the game, the whole game is simply there, there are no new levels, bosses or an end to the game. One simply plays for short sessions. Classic examples of casual games are ‘Tetris’ and ‘Pac-man’, their controls are extremely simple, the game is a single level, the intimidation level and entry barrier is extremely low.
121 (David Edery, Ethan Mollick 2008, Changing the game . p.8) 122 (www.freerecordshop.nl ) Retail games
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Casual games are cheap to make compared to enthusiast ones. Partly because they run on less demanding hardware (phones, internet browsers), they can cost up to two million to make, though as seen earlier on they can just as well be made for free. The games are sold from anything ranging from $0-$40, $0 for some internet browser games or some phone games and $40 for the average Wii game. The essence of a casual game is immediate satisfaction and simple game play. For example; collecting coins, simulating tennis by just moving a controller, pressing two buttons to run as fast as possible, solving logic puzzles or even dancing on a colourful floor mat.
Characteristics comparison Enthusiast games Casual games -Big Budget -Low budget -Complex controls -Simple controls -Deep immersive objectives -Basic objectives -Require hours to complete -Require minutes to complete -Expensive to play -Cheap to play -Usually mature titles -Usually for all ages titles -Challenging and occasionally difficult -Mildly challenging occasionally very easy Figure 24 Characteristics of enthusiasnt and casual games Games can be divided even further. Videogames technically come in two forms, Single player focused and Multiplayer, although the trend is quickly changing with many single player games including multiplayer aspects.
Single player By far the most common and popular form of videogame; the single player experience was always intended to be the core and centerpiece of a videogame. The general gaming population had always been presented with stories or experiences directed at a single player directly. Enthusiast games traditionally are perfect examples of single player experiences, they are interactive movies created to take the player in a journey. Single player games for a long time represented the antisocial aspects of videogames.
Multiplayer The trends have quickly changed however, the popularity of casual games and the growth of the videogame industry in general lead to the introduction of social gaming. This is probably the single most successful design introduction to videogames; the ability for people to play together or against each other whether they know each other or not. In fact multiplayer is so popular that almost every single player game at least the best selling single player games, have a multiplayer mode, and on the other hand there are games that are only multiplayer focused.
The first form of multiplayer came from co-op 123 , with simple games, that essentially required two players to play the game together in the same screen, this took place before the internet became a phenomenon, meaning that the only way to play with another person was to have two controllers and sit next to each other. However now every modern gaming platform has the internet integrated within, meaning that multiplayer is no longer limited. One can play with anyone around the world (depending on the game), for enthusiast games multiplayer
123 Co-op: Cooperative game play, two or more players playing together
~ 55 ~ usually means competition. ‘Call of Duty 4’, a ‘modern shooter’ released in 2008 is a clear example of an enthusiast game, complex controls, high levels of production and a story lasting 5-7 hours. However it was not the single player aspect of the game that made it popular. ‘Call of duty 4’ has been the most played game of 2008 because of its multiplayer aspect, helping the game to sell over 12 million copies. 124 The multiplayer aspect of the game simply consists of one team fighting against another team; whichever gathers the most points wins the round. For advertisers it would be recommended to look into multiplayer aspects of a game if possible, there are many benefits that could help the advertisement get its own legs. A quick example could be, leaderboards 125 : The advertiser can include a scoring system in their videogame, at the end of the game the player receives their high score, which is then added to a global high score board that collects the data from all players who have played the game. This gives incentive for a player to keep trying to better themselves, perhaps even to show the game to friends and colleagues to compete with people they know, giving the advertisement its own viral marketing for free . Videogames can be placed within four categories, all of which fall under the descriptions above: Enthusiast single player, enthusiast multiplayer, casual single player, casual multiplayer . I did mention that many single player games now offer a multiplayer aspect; this is largely the case; however videogames are created with one of the aspects being the core focus, when they go on sale they are marketed as either or, usually. Single player game
GTA IV Rolando
Enthusiast game Casual game
World of Warcraft Wii play
Multiplayer game Figure 25 Gamer VS Game paradigm
124 (www.gamespot.com/news/6206854.html ) Call of duty 4 sales 125 Leaderboards: A board that collects the highscores of all players
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Examples combining both spectrums
Single player enthusiast game The example I chose to represent this category is Grand theft auto four or in short ‘GTAIV’. This game is a prime example of an enthusiast game and one that is single player focused which can only be played on the ‘Playstation 3’ or ‘Xbox 360’. The whole premise of the game is very mature and story driven, the game takes place in a realistic representation of New York, in fact the whole city is recreated as a life simulator; people walk around, they do their own thing, everything is designed to feel like a real city. The game then takes the city and introduces your character to it and develops a story around it. The game starts you off with nothing and by the end you are a well respected and powerful character.
Needless to say it is a violent game, one that many have been careful to discuss, the game allows you to take any action, many of which the story requires to be violent, nonetheless if a player is not into adult entertainment, you do have the option to play as you like, and apply social rules to the game. What makes this an enthusiast game? The whole scale of the game creation itself parallels that of a big screen movie; $100 million budget, voice actors, a soundtrack based on contemporary music etc. 126 The game will require approximately 20 hours to complete and becomes more and more difficult as the game progresses, failure is met with punishment, making the player redo a mission with less health or weapons. The story can only be played by one player. One important aspect for advertisers to take from this is that, these highly budgeted games, especially those based on reality are very open to not only sponsoring but advertisements. ‘GTAIV’ recreates a huge city including Times Square; the whole game has ‘fake’ brands, partly a design choice, but also a lack of advertisers willing to invest. This is a game that sold 3.6 million copies in its first day, it is not that the game was unsuccessful that turned advertisers off, there are many reasons. However the audience has spoken and have actually recommended for the developers to include real brands whether in an update or in a future title.
Figure 26 GTA IV
This is an example of a very richly detailed game, one that with advertisement could enhance the level of realism and with an audience largely open to the idea of having them. For
126 (www.shacknews.com/onearticle.x/52464 ) GTAIV budget
~ 57 ~ advertisers interested in reaching a mature audience, mostly male and between the ages of 18-35 this is a great example of a videogame with possibilities to advertise on.
Multiplayer enthusiast game Perhaps one of the most hyped and successful games in the gaming industry is ‘World of Warcraft’, a multiplayer only game which has sold over 11 million copies (not including two expansions to the game). In fact currently there are over 11 million people playing the game actively, spending hours every week in the game. 127 ‘World of Warcraft’ is a great example of a multiplayer enthusiast game. For one it can only be played on the internet, there is no other way to play the game but online with millions of players at the same time. ‘World of Warcraft’ falls under the category of games called ‘massively multiplayer online’ game (MMO), these games are open ended, they literally never end, players do quests in a massive world with the main focus being to level up a character socially . These games only function with millions of players wondering around creating their own adventures.
For the game to appeal to a broad audience it is not very demanding so almost anyone with a PC can play it, the only requirement apart from owning the game is that one must pay a monthly subscription of $15 to play the game. This was a bold move done by the developers of the game; however with over 11 million people paying monthly their profits have surpassed that of many companies since the game launched in 2004.
Such games are at the core of enthusiast gamers, they require continues game play, it is literally like living another life for many. If the player doesn’t invest the hours, the world moves on, everyone else moves on except you; there is no pause to these worlds. The average ‘MMO’ player spends 20 hours playing these games a week. 128
Figure 27 World of warcraft
‘World of Warcraft’ is a fantasy game, it is these sort of games that have made advertising difficult, no one has found a creative way so far to advertise on non-reality based titles. Hence unfortunately even though the numbers of ‘World of Warcraft’ players are fascinating
127 (www.destructoid.com/many-people-playing-world-of-warcraft-and-by-many-we-mean-11-freakin-million ) World of warcraft success 128 (www.nickyee.com/daedalus/archives/000891.php ) Average time spent playing MMO’s
~ 58 ~ advertisers would not be recommended to try this line of games as a first choice. Though there are plenty other multiplayer enthusiast games, MMO’s however are complicated in an advertisement point of view. On the other hand games such as ‘Second Life’ are completely funded by advertising; second life has around 6.16 million users. 129 This and many other multiplayer only games can be prone to advertising, the biggest challenge with these games is: it must fit with the brand, it must add to the experience and it must not be a blatant advertisement. Simply because these games are exposed to millions of players at the same time, advertising must be very carefully implemented as to not create massive backfire.
Single player casual game For a single player casual game I chose ‘Rolando’ as an example. ‘Rolando’ is an ‘I-phone’ only game, which can be bought from the application store for just $5. 130 The game has generated over $2 million in sales since its launch in June 2008. 131
The premise of Rolando is very simple; the player must take his character from point A to B, using the ‘I-phone’ capabilities such as the touch screen and motion sensor. The game is rather short, having four maps and 36 levels which can take anything from 5-10 minutes to complete, the idea being that the gamer plays in short bursts, a level or two each time. The game can only be played by one player. There really is not much more to the game, which for advertisers should indeed be interesting. The fact that such simple games cost so little to make yet they can make profit and are played by millions, even on the ‘I-phone’ which was not considered a gaming device. For an advertiser trying to reach a casual audience, one that perhaps is not necessarily into gaming, but they like casual entertainment, this is a great venue to reach them. As will be discussed in the next subchapter, casual games such as this can easily be created or funded by an advertiser, as long as the game is good, it will get attention and sell. If the advertiser releases it for free, and the game is good, well that is a free treat for many, and millions of people playing through an advertisement.
Figure 28 Rolando These single player casual games are a huge market, as mentioned before there is an average of 150 million people who regularly play such games only on the internet , for quick entertainment.
129 (www.betanews.com/article/How-Many-Users-Does-Second-Life-Really-Have ) Second life users 130 (www.rolando.ngmoco.com/ ) Rolando homepage 131 (www.edibleapple.com/ngmoco-ceo-and-rolando-developer-heaps-praise-on-the-iphone-better-than-the- ds-better-than-the-psp ) Rolando success
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Multiplayer casual game Multiplayer focused casual games are some of the most successful games recently. The popularity of the ‘Wii’ has lead to an avalanche of games focused on getting people to play together. Instead of recreating a multiplayer experience like ‘World of Warcraft”, these casual games focus on small exciting games, with simple goals, sometimes competitive and sometimes cooperatively, however always intended to be played by more than one played.
The example chosen for this category is ‘Wii Play’, one of the ‘Wii’s’ most successful games, partly due to a rather clever idea that ‘Nintendo’ had. ‘Nintendo’ understood that this game was meant to be played multiplayer, never alone, hence enforced that message by bundling the game to another ‘Wii’ controller. As a result whenever someone wanted to buy another controller for the ‘Wii’, they realized that by spending $10 more, they could get a game. Needless to say this action alone has lead the game to be at the top of the sales charts for months on end, the ‘Wii’ has been selling out constantly, a console designed to be played socially with others, meaning people were going to buy more controllers, most of which chose for this bundle. Ultimately the game has sold over 10 million copies in the US alone. 132
‘Wii Play’ is an incredibly basic collection of nine fun mini-games: Shooting range, Find mii, Table tennis, Pose mii, Laser hockey, Fishing, Billiard, Charge!, Tanks!. All these games are designed to be played with another player side by side. Each game takes approximately 10 minutes to complete, again considering this is a casual game this is not surprising. The reader can see that the potential here is tremendous, not only is the ‘Wii’ a huge success but the internet and ‘I-phone’ are two very strong platforms for casual gaming.
Figure 29 Wii play
Hopefully by now the reader can see that once the advertiser has a target group, the videogame to be chosen to advertise on can be selected based on the categories presented above. Many more pages could have been spent on very diverse examples for these
132 (www.informationweek.com/news/personal_tech/virtualworlds/showArticle ) Wii play US sales
~ 60 ~ categories; however the selections show a rainbow of possibilities for the reader to get an idea. By now the reader should have a pretty good idea of videogames as a medium, why advertisers should be in the very least interested, the potential that lies within, the factors that should be taken into consideration when choosing videogames over other media and an understanding of the videogame demographic. Now I present the possible ways an advertiser could present their brands using videogames, using a mixture of tested and successful models, alternative advertisement methods and trends that have all signs to be the next big thing.
5.3Different advertising models within videogames
There are in fact advertising models to use in videogames, models that have been tried and tested, and in reality are the only current ways of advertising within the videogame spectrum. This is an important part of the thesis because choosing which model to use can be the decisive factor between an effective advertisement campaign and failure. This subchapter will explain the different models, give examples of successful campaigns and show their key advantages.
There are two unique models that can be used in this industry: ‘In-game’ advertising and ‘advergames’.
In-game advertising: In game advertising is essentially promoting a brand inside an already existing game. This can range from anything between product placements and billboards to videos. The key to successful in game advertising is integration. As expressed earlier on, in- game ads cannot be immune to the laws and rules of the videogame, in an action game for example if the whole world is prone to being damaged by the player or story, the advertisement cannot simply be immune/invincible. 133 Another success factor is that of setting. Currently those who have tried to advertise in a non realistic setting have failed simply because our world does not blend itself with a fantasy based one; one can place their brand on a racing car but not on a unicorn. Hence games based in real settings have the possibility to be advertised on, luckily for advertisers, over 40% of enthusiast games are based in modern settings. 134
In summary, the core factor for successful in-game advertising is that it must enhance the realism of the game and not interfere with the game-play or experience, natural integration is a must. 135
Finally in-game advertisement primarily takes place in enthusiast games, because they are mostly based on real settings and have the production value to deliver rich detail and tools necessary for advertisers to deliver their message. Casual games are technologically limited and mostly fantasy based.
133 (David Edery, Ethan Mollick 2008, Changing the game . p.43) 134 (David Edery, Ethan Mollick 2008, Changing the game . p.44) 135 (Marolf 2006, Advergaming and in-game advertising. p.82)
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Advergames: Advergames are games build upon an advertisement. They are literally playable advertisements, and anyone playing them is aware of this fact, hence the integration factors needed for in-game advertising are less demanding in this case. Advergames are created by brands usually by hiring videogame developers to get better quality. Advertisers have great freedom of expression using advergames, they are the perfect tool to let a consumer experience a brand in a controlled but fun environment. 136 Advergames are relatively cheap to develop for the benefits one receives. They are always casual experiences, short fun games that require no more than a few minutes to complete, however many are designed to be played repeatedly. Advergames are usually released for free online, but due to the massive amount of content online, their biggest struggle is getting noticed, viral marketing is a key factor, they need viral elements to spread across the internet for free. Fortunately advergame developers know this very well and are experts at creating viral videogames. 137
Advergames have proven to be a great way to promote on the internet, considering that it has proven to be almost impossible to advertise unobtrusively on the internet. 138 With advergames consumers are willing to be exposed to advertisements in exchange for entertainment. Advergames are great for creating awareness, however and perhaps a more interesting aspect is their ability for two way communication. A smart advergame will make the player make choices and decisions that might teach the advertiser of certain behavioural or decision making aspects of the targeted consumer. 139
In the coming pages the reader will be presented with the different options to advertise within these two models, and what benefits and requirements should be taken into consideration for each.
5.3.1In-game: Integrated advertisements
In other words: product placement. As with Film, movies or television series, vidieogames can also be a great platform for product placement. There is no need to explain product placement, it is a well implemented advertisement option for advertisers. For years companies have placed their brands in movies such as ‘James Bond’ in order to show the audiences the value of their product. This has been a successful way of promotion, consumers have had the chance to ‘imagine’ what it would be like to have the product…videogames can let you experience the value.
It is the only medium were an advertiser can realistically implement a representation of their product or brand and let a consumer experience it beforehand, and in the intended environment. Product placement in enthusiast games is not a new trend, most sport titles such as ‘Madden’ (American football simulation game) represent the real stadiums, the real players all up to date in photo realistic detail. One can easily see the temptation, to not only watch a football match on TV but take control of your favourite team and win the match yourself . Racing games such as ‘Need for speed’ 140 have implemented real branded cars even
136 (www.woolfenden.com/?p=98 ) About advergames 137 Little chicken interview in appendix 138 (Marolf 2006, Advergaming and in-game advertising. p.46) 139 (David Edery, Ethan Mollick 2008, Changing the game . p.60) 140 (www.needforspeed.com ) Need for speed homepage
~ 62 ~ the oil used in the cars is branded. Gamers have proven that they much rather have a real branded item they can relate to than a generic representation. 141 These are just basic examples however, examples that actually seem logical. It is the more creative integrated in- game advertisements that really get the attention and leave a positive impression with the gamer.
Figure 30 Porsche in 'Need for speed'
A truly effective product placement in a videogame would be one that the player constantly uses throughout the experience and gets to use it as it is intended, which incidentally shows the player the advantages and value of owning the product, in the very least it might leave a positive feeling about the brand. A great example of this was given in the previous chapter with ‘Sony Ericson’s’ product placement on ‘Splinter cell: Pandora tomorrow’. In the videogame the branded phone was integrated directly into the story, the gamer using the phone as a tool to help him/her through the game. On this case the gamer learned how to use the phone, and learns of its benefits due to the integration into the story. Another example comes from ‘Metal Gear Solid 4’ where the gamer has an ‘I-pod’ through the whole game, and can use the product as intended, you could add music, scroll through music etc.
Needs • Costs: Integrated ads are expensive, but not as expensive as product placements on other mediums. Still it can range from $20,000 – $1,000,000. 142 It is because of this that this form of advertising, is best fitted to brands with bigger budgets and well known brands. • Integration requires time: Enthusiast games, take anything from one to five years on average to develop. 143 To create a well integrated product placement in the story of the game and perhaps even in the game play requires a lot of planning on both sides. Due to this fact spontaneous advertisement is not possible, and an advertiser will
141 (www.hollywoodreporter.com/hr/search/article_display.jsp?vnu_content_id=1001612449 ) About in-game product placements 142 (www.hollywoodreporter.com/hr/search/article_display.jsp?vnu_content_id=1001612449 ) Costs for integrated ads 143 (www.vgchartz.com/forum/thread.php?id=63976 ) Game development costs and time
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usually advertise products not yet released so that when the videogame is on sale, the product is then either on the market or about to be released. • Needs to be natural and necessary: Perhaps the most demanding requirement for effective in-game advertising is that it must be a natural integration in the videogame. The more subtle is usually better; as long as both developer and advertiser can find a way to naturally blend the brand/product into the game without making it feel like a paid advertisement then the chances are fairly high that it will not come across as intrusive. If the advertisement comes across as intrusive it can easily backfire and create negative feedback on the brand. • Enthusiast games are the market: Because of the need for product placements to be placed in realistic based games, enthusiast games come out as the core category. The realism and technology these type of games provide is ideal for product placement. This does limit the audience however, since casual gamers are not the core market for enthusiast gamers. Advertising in casual games is as of this date an unexplored venture, mostly because of the reasons dictated above.
Advantages • Revolutionary way to experience a product: Like no other medium available, the power of interactivity is what makes this such a special promotional tool. Allowing a consumer to play with a brand for hours and experience its qualities in a realistic representation should be what all advertisers strive towards. In fact this can be so successful for games such as ‘Fifa’ (football simulator) that the main reason why people buy the games is simply because of the product placement of the real football players and better graphics. For years ‘Fifa’ games have not changed much (it is still the same mechanics of playing football) but the characters and stadiums change and the production values increase. Sales of ‘Fifa’ increase year on year with the 2009 version selling 37.5% more on its first week. 144 People want to pay in many cases with brands they cannot afford or experience them in ways that are impossible to them. • Long-term placement: Due to the nature of videogames, advertisements within them are embedded for the long run, the product placements will not change anytime after the videogame is released, and videogames once released are available for an undisclosed time. This means that the investment put into advertising in the game will last for years to come, making it quite a cost effective promotional tool in the long run. • Positive recall: Research has shown that videogames are an effective way to advertise because of the positive recall they receive. Gamers who see a well implemented advertisement in a videogame, have a general positive reaction to it and can recall the brand after playing the game. 145 Another reason for this positive response is because people play games to entertain themselves and hence their anti advertisement guard is down, when faced with a brand in a videogame they already are in a positive status and can more easily accept the advertisement especially if it adds to the experience.
144 (www.mcvuk.com/news/31958/FIFA-09-enjoys-record-breaking-week-one ) Fifa sales 145 (www.jiad.org/article96 ) Effects of in-game advertising
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5.3.2In-game: Passive, static/dynamic ads
There is an alternative way to advertise in-game. It is referred to as passive advertising because of its more subtle focus over integrated advertising. This form of advertising is much more simplistic. They are the equivalent of outdoor advertising and can also include simple brand representations such as logos, video or the inclusion of a brand in the dialogue of a game. Mostly however this form of advertising consists of billboards, posters any form of advertisement not directly tied to the game but as part of its decoration and realism. The name passive comes from not demanding the attention from the player, but being in the world where the player can see it. As one can imagine this is a cheaper alternative for in- game advertising it requires little effort for implementation in the videogame, which is more suitable for companies with smaller budgets that cannot afford product placements or quite simply the game might not even have the possibility for in-game advertisement leaving passive advertising as the only option. There are two distinctive distribution methods for these ads:
Static Static passive advertisements refers to ads placed in videogames that do not have internet accessibility, this means that the advertisement must be implemented in the game during its development stages, making it quite similar to product placements. This however is very quickly becoming outdated with all modern console platforms having the support of the internet, if the game requires static advertising it is because of the developer’s choice to not support online functions. An example of an static ad can be seen in ‘guitar hero 3: legends of rock’, the game mainly features instruments by ‘Gibson’ the official sponsors of the game, however ‘Axe’ included a guitar with their logo on it, during the development of the game. 146 This is not product placement because, ‘Axe’ does not make guitars and it is static because it was hardcoded into the game, making it impossible to change.
Dynamic ads Dynamic ads are no different than static ones, apart from their online capabilities. This is a new trend in, in-game advertising and the one to ultimately take over passive advertising. Pretty much every new game that comes out for the consoles has online elements, for advertisers and developers this means that for the first time ever in videogame history, changes can be made to the game after it is completed or released. 147 For developers this is good because they can add content to the game at a price later on, or fix problems after release. For advertisers this means they do not need to plan their ads anymore, they can now approach a developer and say “we would like to place a billboards on your game for the next two weeks” and it could be done within hours. This is a great advantage for advertisers, it gives them the freedom to be spontaneous and advertise their brands at a relatively cheap price.
A great example of a dynamic passive ad and one that has just taken place recently comes from the Obama campaign in 2008. 148 While campaigning to gain votes for his presidency Mr. Obama looked towards videogames as an advertising tool to approach the young adults to
146 (www.gamasutra.com/php-bin/news_index.php?story=15984 ) Gutiar hero 3 ads 147 (David Edery, Ethan Mollick 2008, Changing the game . p.46) 148 (360.kombo.com/article.php?artid=14708) Obama burnout ads
~ 65 ~ vote for him. His administration decided to do this in ‘Burnout paradise’ a popular racing game which focuses on racing as fast as possible through a realistic looking city (which includes advertisements), the game at the time had sold around 1.5 million units. 149 The Obama ads were made in the form of billboards which were scattered around the whole city from October till November of 2008. 150
Figure 31 Obama campaign ad
This advertisement seemed to be so successful that the Obama campaign decided to expand their reach and further advertised in 17 more games during that period spending a total of $44,465.78 in comparison to the $4,000,000 on TV ads. 151
Needs • Games that support passive advertisements : Not all games have open worlds or at least storylines based on scenarios where advertising would make sense. Therefore finding the right game with advertisement possibilities can be challenging. • Enthusiast gamers as core market: Same as with the product placement, only highly produced enthusiast games can support the realism needed to advertise in a real world setting.
Advantages • Cheap: For in-game advertising the passive choice is relatively cheap not costing more than advertising on a few magazines. • No need for planning during development: because of their internet capabilities developers can manipulate content at any time, meaning advertisers don’t need to plan years in advance what exactly they want to advertise, and can do so on a timely basis. • No need to hide the fact that it’s an advertisement: Because passive advertising is there to enhance the realism of the game, gamers to do not mind the fact that they
149 (www.ps3vault.com/burnout-paradise-passes-the-1-million-sales-mark-2767 ) Burnout sales 150 (www.gamespot.com/news/6199379.html ) Obama ads 151 (www.gamespot.com/news/6200232.html?sid=6200232 ) Obama campaign costs
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are real brands, they are meant to be branded spaces in their minds and it’s simply another step towards blurring the lines between fiction and reality.
5.3.3Advergames (physical and online)
When it comes to advergames there are two different methods that can be used, that are related to distribution. Either way both distribution models represent the same videogame design and philosophy. They are created to deliver an advertisement in a game form, a short casual game. Advergames are the most common and successful form of advertising within videogames. They have been used by many major brands and their popularity is sky rocketing due to their success stories.
Physical distribution this is the rarer option for advergames. These types of games are distributed physically meaning that the advertiser or company needs to have a distribution chain already in place, or a product they can attach the game with. This form of advergames are rarer simply because it is more expensive, however they do have direct distribution and do not compete with the thousands of videogames on the internet, hence viral marketing is not necessary.
The best example to date of a successful brand using advergames and distributing them physically comes from ‘Burger King’. In 2007 ‘Burger king’ released three advergames that replaced the ordinary toy in their ‘happy meals’ the consumer would simply have to pay an extra $3.99 to purchase it. 152 This was a bold move by Burger King; usually advergames are given for free understanding that people are playing an advertisement. However their decision proved to be their biggest success story that very year. The value of a videogame compared to a plastic toy was monumental to consumers and there were no problems selling the games, in fact they sold so well that ‘Burger King’ reported a 40% increase in profit due to the success of these advergames.153 Their success was directly tied to their distribution, beforehand millions of people were already buying their food, and they simply added an incentive, an incentive that sold 3.2 million.154
Online distribution By far the most standard form of advergames, the ones found on the internet browser. For advertisers this means easy cheap distribution one they can keep track of their consumers behavior and feedback. The only problem being that there is strong competition for attention on the internet and those advergames which do not include viral elements tend to fail rapidly. 155 The advantages however are tremendous; they are cheap to produce, they allow the user to firsthand experience your brand in a fun way, they can potentially reach a wider audience with more impact than other media and give the advertisers essential two way communication with no extra effort. A good example of a traditional advergame is ‘Nike’s Nike Shox’. It was an advergame that let the players create their own shoes to then try them out in a virtual basketball court. The gamer could then compete in a slum-dunk contest with
152 (David Edery, Ethan Mollick 2008, Changing the game . p.67) 153 (David Edery, Ethan Mollick 2008, Changing the game . p.67) 154 (David Edery, Ethan Mollick 2008, Changing the game . p.33) 155 (seoblog.intrapromote.com/viral-advergaming) Viral advergames
~ 67 ~ their friends online (by sharing scores and a screenshot of their best move). 156 The most interesting thing about this advergame however is how they used it to research their consumer’s decision making. The first thing the player is asked to do is to customize their shoes, by using different models and colours. By doing this ‘Nike’ could easily find what the most popular models and colours were. One can only imagine how effective this two-way communication can be. ‘Nike’ could have implemented prototype models not yet released to find out which would be most welcomed and save themselves thousands of extra dollars on research.
Another example on how to successfully create a fun experience while getting important information could be from an online representation of a clothing store. As the owner of the brand I could create a simple game where the player creates a representation of themselves, perhaps even including their picture and can try clothes on choosing their size etc. This way not only is the consumer getting to try clothes on at home, but I would be learning of their interests indirectly.
Needs • Distribution channel: Whether online or with physical distribution, advergames need the advertiser to plan a distribution channel, typically advergames are created by experienced game developers which know the ins and outs of the internet. Still the advertiser will need to pay for either printing the game on disks or for the space on the internet. • Viral marketing: Online advergames need to have viral elements to help them spread their reach naturally. Viral aspects of advergames are explained in chapter 5.5
Advantages: • Two way communication: A benefit that no other media can match at this moment, advergames provide the advertiser with immediate feedback from their consumer, and the advertiser can manipulate in what aspects the consumer gives feedback. The fact that the advertiser has direct control over the videogame means that their freedom for expression and creativity is infinite. • Cheap and long lasting: Little Chicken the advergaming company I interviewed creates games for 25,000 to 55,000 this is not the cheapest however it is not even close to the costs of TV, furthermore Little Chicken takes care of the implementation and viral marketing, making this the total costs. An investment that can be beneficial for months. • Fun and unique: In an age where most of us try to avoid advertisements and are far too aware of their intentions it is a spark of hope for advertisers, that there is a new fresh approach that can satisfy both parties. In time it could end up like other media however those who use it now are experiencing great results and in the minds of consumers hold a more positive image than other competitors.
156 (www.webadvantage.net/webadblog/advergaming-131 ) Nike Shox
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5.4Alternative ways advertising could be used within the models
Now that the main advertising models have been explained, it could be interesting to briefly go over possible alternative to use videogames as a promotional tool, the methods discussed in this section are rarely used, mostly because they do not have the promotional impact of in- game advertising or advergaming, however they are very unique, and for certain organizations could prove to be incredibly useful and effective to create awareness.
Reverse product placement By just reading the game one can already create an idea on what this form of promotion is. It is in fact the opposite of product placement, where as in in-game advertising a brand can place their product in the gaming world for the players to interact with, reverse product placement takes a virtual product into the real world, literally “taking products and brands from media into the real world.” 157
The idea is to take products or ideas that are popular in the media world but do not physically exist and create them out of their popularity into real products. The benefit is that, there is already a target audience that is ready to buy such product, when it comes to videogames if an advertiser would take an item that clearly represents the games franchise and release it in retail form, the millions of fans of the game alone will be interested in this bridge between the virtual and reality.
This is a very uncommon form of promotion, one that has been tried in different media, for example there is a chain of restaurants called ‘Bubba Gump Shrimp Co.’ A brand directly taken from the movie ‘Forrest Gump.’ An example of a company using this method in videogames is with the energy drink called ‘potion’ released in Japan in 2006. 158 The drink was directly taken (including the name) from the videogame ‘Final Fantasy’ a role playing franchise with millions of fans, the whole franchise having sold approximately 55 million copies. 159 All the games use a drink called ‘potion’ to restore the players health. This is a good example of a good fitting advertisement between the videogame world and the real world. The drink was only released in Japan however, limiting the number of people that could buy it and was released for a limited time. There were three million of these drinks made all of which were sold in a very short time. 160
This could be an interesting area for a business who perhaps is not interested in promoting its own products but it’s looking into selling niche items, as videogames continue to become more popular more and more gamers will become aware of the videogame lore, their characters, worlds, items etc. There are thousands of items and products that can be taken from the videogame world into stores. However another point of view for this method, one that has not been discussed or researched in any significant way is advertisers or marketers creating products they are planning to sell at some point, and placing them in videogames as
157 (David Edery, Ethan Mollick 2008, Changing the game. p.86) 158 (David Edery, Ethan Mollick 2008, Changing the game . p.88) 159 (vgsales.wikia.com/wiki/Final_Fantasy) Final fantasy sales 160 (David Edery, Ethan Mollick 2008, Changing the game . p.88)
~ 69 ~ part of a marketing strategy. For example any car manufacturer can allow a big driving game franchise to implement their prototype into the game, in fact the advertiser would not even need to spend any money on extra marketing tools, once the car is in the game and the game is released, the gamers will play with the car, many of which will realise that the car surprisingly doesn’t exist, but it looks good, it plays like all the other cars, it feels real . The hype will spread, the press and media can easily pick up on it and once the attention is there, the car manufacturer can go ahead and officially announce this new car.
This is just an improvised idea in a sea of endless possibilities, just as with any form of videogame advertisement, the advertiser must know where and with whom they are getting involved with. The thin line an advertiser must always take is how not to destroy the gamers illusion, and do their best to make any form of advertising as natural as possible.
Anti-ad games This is a form of advertising, however not products rather ideas, and moral messages. Anti-ad games are becoming increasingly more popular largely due to their success. An anti-ad game is not a promotional form against videogames but it is an anti, negative message against something. 161 Perhaps the most contemporary and well known example of this is ‘PETA’.162 These advertisements are in essence advergames. They are created by organizations or groups that depend on convincing and persuading target groups to take action. They have discovered that videogames are a fantastic and powerful tool to achieve their goals.
‘PETA’ has recently received a lot of attention for their shocking advergames. They have been creating anti-ad games by taking brands that people are aware of such as: ‘McDonalds’ and ‘KFC’, and creating casual games where the player must interact ‘doing the horrendous bidding of the brands’. ‘Cooking mama: Mama Kills animals’ is one of PETA’s newest games, it is based in a popular ‘Wii’ game called ‘Cooking mama’, a game where the player gets a recipe and must recreate the dish. PETA however took the concept to a whole new level. The player must in principle follow a recipe and prepare a meal, however the whole game is violent and dark. It clearly tries to invoke animal torture and pro vegetarianism. 163 ‘PETA’ is well known for their direct and shocking efforts, I am not in a position to judge their means and efforts, their advergames are very successful, quickly spreading to the news and message boards. As a side note however, this particular game quite violent, perhaps on purpose for their audience to get impacted.
161 (Marolf 2006, Advergaming and in-game advertising. p.65) 162 PETA: people for ethical treatment of animals 163 (www.reghardware.co.uk/2008/11/18/peta_videogame ) PETA game
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Figure 32 Cooking mama: Mama kills animals
Another example of an anti-ad game is an anti ‘McDonalds’ game created by an Italian company which focuses on creating such games for activists. In the game “players switch back and forth between a ‘McDonalds’ farm, feedlot, restaurant and headquarters. Players can boost their score by fattening cows with hormones and firing ineffective workers, clearing woods to plant genetically engineered soy and by corrupting a local governor.” 164
These advergames must be made available online, since it is their viral effects that spread them around, and the internet is a highly accessible platform to most. Though not a traditional promotional tool, for activists and groups trying to differentiate themselves this is a powerful, though risky possibility.
User created content User created content is perhaps the most interesting alternative method. It requires very little, simply a good combination of brand and game. The idea of user created content only applies to the PC and Phone platforms because the development tools are freely available.
Furthermore, user created content is sort of an ‘add on’ to an already existing videogame. But many groups can easily access it and use it. An example of user created content in videogames is ‘Half Life’ from 1998, a popular PC only game, one which launched with free tools for players or anyone interested to create their own content. Out of this tool set ‘Counter-Strike’ was released. ‘Counter-Strike’ was unique in that it was created by a small group of players for fun, it was so successful that it drove the sales of the original game ‘Half Life’ over 11 million. 165 Simply because to play ‘Counter-Strike’ you needed to have the original game. To this date, 100,000 players are still playing this free content. Hence by releasing a simple set of development tools with ‘Half Life’ the developers managed to not only increase the sales of their original game but prolongue the life of their game for free, through voluntary labour.
Due to the success of ‘Counter-Strike’ almost every major PC videogame is released with a set of tools for players to create their own levels, from time to time a talented group creates an impactful title. This was a good example of how user created content has helped videogames themselves, however the reader might be wondering how this relates to advertising. In the chapter ‘Game types and how they relate to target groups’ I mentioned how ‘GTAIV’ gamers were interested in seeing the world of the game with real brands. Well they got what they
164 (Marolf 2006, Advergaming and in-game advertising. p.66) 165 (David Edery, Ethan Mollick 2008, Changing the game . p.24)
~ 71 ~ asked for partly . A group of gamers got together and created a ‘mod’ 166 that implemented real brands into the world! Without advertisers getting involved, or the developers. The only issue is the gamers can only put the content online for free; they do not have the means to get enough attention for a mass majority to know about it. An advertiser with some spare change could have just as well hired a few part time gamers to create this content, and then offer it for free to the gaming community. There are many other possibilities that an advertiser could use, user created content for.
User created content communities are no small group in the PC market, many videogame companies. Many videogame companies rely on their gamers to give them feedback and free content. For example, ‘The Sims’, one of the most successful PC games in fact the whole franchise has sold over 100 million copies of the games. 167 Part of their success is their strong dedicated communities. ‘The Sims’ is a game where the player controls a virtual family, taking care of their every need, including building their homes, redecorating, feeding, entertaining etc. For the game to continue to interest such a big market the developers understood the importance for the community to create their own content. Rapidly fan websites, with an average of 600,000 users started developing content for the game. 168 As a result some of these communities created as much as 400,000 free pieces of content. The developers took things even further, by asking players to give them feedback on the games problems etc. On average they managed to fix 1,300% more problems than with their paid staff.
There are possible ways to use advertisement in this fashion, however there is no data of attempts, this could become a trend, and it can definitely be effective. Perhaps such advertisements should come in a subtle way, by hiring a few gamers to create content with the advertisers brand and then releasing it. As long as it adds to the gaming experience and is good content, the majority of gamers will not be resistant.
Figure 33 The Sims
166 Mod: Modification 167 (www.gamasutra.com/news/mobile-phone/?story=18259 ) Sims sales 168 (David Edery, Ethan Mollick 2008, Changing the game . p.25)
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5.5Requirements and advice for advertisers considering this medium
Now the reader knows about the possible ways one could use videogames for promotion. However there are key requirements and factors that one must keep in mind. These factors ultimately will to a great extent determine the success and effectiveness of the advertisement. Every medium has their own requirements for success, so do videogames. Due to the different models one could use, I have divided the factors into their own sections.
General requirements
Know your target group: Though this should be logical and advertisers are usually experts at knowing their audience it still must be mentioned, that it’s all about the audience. When it comes to videogames perhaps even more so, by using the categories and paradigms described previously (gamer types, game types) one can more easily assert the right link between the videogame and the gamers. The difference between casual and enthusiast is quite astounding, and the videogames that represent those audiences follow different paths. Hence the first thing an advertiser should do is: create a clear profile of the target demographic (are they casual or enthusiast? Which platforms would they be playing? What type of game would they play?) Then create a list perhaps with the help of an agency with the possible videogames the advertisement could be on, or in the case of an advergame, the type of game it would be. Once the videogame is pinpointed, the rest of the process can begin.
Clear communication with developer : Again it seems quite logical but communication is essential, especially when it comes to advergames. A developer creating their own game will try to integrate your advertisement accordingly. However when a developer is hired to create a branded game, the vision of the advertiser and the brand needs to be the focus, while the developer makes sure that the vision is fun. It took burger king eight months of changes in their games design, Burger King had a clear idea of how the games had to feel and come across and they did not stop until the developers got it just right. 169 Most companies simply hire a group to make the game, and then accept it as it is, perhaps because they don’t know better. ‘Burger king’ however with their 40% profit increase due to their three advergames have proved that communication and dedication are well worth it.
Games must be fun: Finally and most importantly whatever model is chosen, even if the advertisement is not clear, or the design process did not go well, if anything needs to be saved it is the game itself first and foremost. Create a fun game and people will come and play it. All my interviewees picked interactive fun as the number one reason to play games; furthermore they would have no problem playing any game at all as long as it’s fun. I stress this because surprisingly, most advergames are sloppily designed and simply bad in the end. 170
One might have a fantastic well implemented brand in a videogame, however if when it comes out it gets horrible reviews because it’s a bland not fun game, then the potential of the ad is severely affected.
169 (David Edery, Ethan Mollick 2008, Changing the game . p.67) 170 (www.fileplanet.com/fileblog/archives/2007/09/entry_362.shtml ) Image of advergames
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In-game
Must be a natural fit : The advertisement must make sense in the world of the game. ‘Red Bull’ in their first attempt in using videogames because they chose a game where the brand could not exist in. In the very least one should give the brand a face lift to make it believable. For example, there might be a game based in the future, and you as an advertiser promotes sunglasses, do not simply incorporate your current models in the game, update them, make them futuristic but branded. An example of a well integrated ad comes from ‘PHILLIPS’ in the game ‘Brothers in arms’. ‘Brothers in arms: Hell’s highway’ is a realistic representation of World War 2, that sees the player fighting as a paratrooper during operation market garden. In one level the player is fighting through an industrial center, one based in real events, part of the level takes place in a PHILLIPS factory, the company was eager to recreate their old factory, hence the brand was implemented in the game, however they did not simply place their logo, they recreated the whole factory as it was, old PHILLIP’s logo and everything. 171
Figure 34 PHILLIP's in Brothers in arms: Hell's highway
In-game advertising requires effort, no matter if it is a simple billboard or product placement. The advertiser should do their best to in the very least make sure the ad makes a natural fit and not seem like a blatant advertisement, however for truly memorable moments, one must seek the key areas or moments in the game where the advertisement would be best suited (a victory march, an important cut scene, a well lit tunnel, a point where the brand could actually be helpful to the player etc). While on the other hand, one must make sure the advertisement doesn’t take place in the negative moments (nuclear explosion, frustrating or difficult sections of the game, burning building). 172
171 (www.gearboxity.com/content/view/323/38/ ) PHILLIPS in-game advertising 172 (David Edery, Ethan Mollick 2008, Changing the game . p.51)
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Be willing to trust the developer: This is an aspect rarely discussed, but when workings with a professional development studio trust their decisions about the videogame. They know how to make videogames, what works and what doesn’t. If one finds it hard to trust some decisions it is advised to get acquainted with their previous work beforehand, play their previous games and know what you want the gamer to feel or experience through your brand. In the case of advergames before releasing the videogame to the general public, test it with a focus group that consists of your target audience, see how they react, perhaps the controls are too difficult, and they do not remember the brand or simply don’t find it fun. Allow the developer to do their job but make sure it is effective before ending development.
Advergames
The viral element : This is the one aspect all advergames must incorporate. The success of an advergame heavily relies on viral marketing; luckily it is not complicated or expensive to implement these elements in the games. One must understand that there are already hundreds of games on all platforms, an advergame is still seen as competing in the general market, and the issue is getting people to play your advergame. When it comes to in-game advertising this is not an issue because, the game publisher already has a budget in place to promote the videogame, and the interaction of the advertisement is different. Hence to stand out and expand the advergame’s reach one must implement viral features in the videogame itself. Leaderboards, subscriptions, prizes and the simple possibility to share the game with a friend are simple but very effective features that can easily be implemented in any advergame. Michiel Sala from ‘Little chicken’ expressed how all the advergames they make include effective viral elements, simply because it is almost a design requirement for an advergame to be successful. As the market becomes more crowded with such games, the importance of viral marketing will be ever more present; in fact many will have to find unique and fun ways for their videogames to spread for free.
A great example of a viral advergame can be seen on ‘Nike Shox’ by Nike. Earlier on the game was briefly discussed however one of its key unique features that separated it from the rest was its viral tools. In an attempt to spread the awareness of their advergame Nike incorporated a feature in the game that allowed the players to send their friends or anyone a small screen shot 173 of their best ‘slam dunk’. 174 This is something extremely simple to implement but it gives players a reason to try over and over again to get the best shot to impress or show off to others, someone else will see it and try to better off their challenger etc. The power of word of mouth is astounding and free .
173 Screenshot: instant image capture on a monitor 174 (David Edery, Ethan Mollick 2008, Changing the game . p.63)
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Show don’t tell: One of the main points in using a videogame for advertising is that you can show and let the player experience your brand, rather than show them. It is the only medium where the player and the brand can interact this closely, and in an entertaining way. A successful advergame is one that not only is fun (that just makes the game successful) but one that in the end lets the gamer experience the advertisement with a positive attitude, and hopefully generates not only awareness but sales. For instance ‘Chrysler’ released an advergame to their members, with the objective being to show them what it feels like to drive their new car (at the time) ‘Rubicon Wrangler’. It did exactly just that, the game was a realistic simulation of driving the car; they made sure that it was all scientifically accurate. 175 The advergame cost under a million dollars to make; it was released in 2001 to promote the $32,000 dollar jeep. This was the first time that the company explored videogames as a medium and were not sure how effective it would be. However through their well implemented design and brand experience over 380,000 consumers downloaded the game most of which left their e-mail addresses at the end. In the end of the first orders of the game 14% came from consumers that played the game, they enjoyed the experience , overall 25,000 of these jeeps were initially sold that is 300% over what the company expected to sell. As a result, they decreased their TV advertisement budgets and placed that money into advergaming. 176 This is an example of a brand that put effort into showing the consumers the value of their product through interaction.
Virtual worlds (adverworlds)
Social interaction: Virtual worlds are for social interaction, that is their appeal the possibility to communicate and play with millions of people simultaneously. Virtual worlds need to be handled carefully, they are not traditional videogames in the sense mentioned through the thesis, and these worlds are not MMOs (massive multiplayer online) like ‘World of Warcraft’. These worlds are for interaction primarily. Hence these worlds should make interaction and communication exciting, the advertiser should find interesting ways for people to meet, create events sponsored by your brand for people to gather and perhaps even provide free gifts, they can use in the world of course provided by your brand. One must remember however, these worlds do not sleep or end, people need to have a reason to stay in the world you advertise in, helping developers to make these worlds more exciting can greatly benefit your brand. For example as an advertiser I could sponsor once a week between 20:00 – 22:00 a singles meet up. I could pay the developers to create a especial decoration or scenario in the world at these hours, while my brand provides with singles the possibility to meet and interact. By the end of the event I could provide them each with a virtual gift, something that literally takes minutes to make, but in a virtual world has a great impact.
Blur the boundaries: One of the biggest advantages of videogames is the possible interaction between the advertiser and the consumer. In virtual worlds advertisers can creatively try to blur the line between the real world and the virtual world. Many have experimented with trying to achieve a link between both worlds; it gives player a new and exciting reason to interact with advertisements 177 . This can be done both ways, for example as a restaurant
175 (David Edery, Ethan Mollick 2008, Changing the game . p.73) 176 (David Edery, Ethan Mollick 2008, Changing the game . p.55) 177 (David Edery, Ethan Mollick 2008, Changing the game . p.80)
~ 76 ~ owner, I could create a representation of my restaurant in the virtual world, a place where people can come to meet and eat virtual food. One possible way to blur the line is by providing discounts on the restaurants food that actually can be used in real life. Quite simply all I would have to do is, send a message to all those who are in my virtual restaurant expressing that if they fill in their emails within the next hour; I will send them a coupon to use in my real restaurant counterpart. This way not only will a large group gather around my advertisement, but I would benefit first hand by having the gamers come in person to eat at my restaurant.
An example of an incredibly successful and effective company who blurred the lines between reality and virtual comes from ‘Webkinz’.178 ‘Webkinz’ makes traditional stuffed animals for children, they were facing a difficult financial a few years ago, and decided to risk using videogames as a promotional tool in an attempt to differentiate themselves from competition. ‘Webkinz’ created their own, simple virtual world, what they did was, they included a code that came with the stuffed animal, this code could be inserted in their website, which would give the consumer a virtual version of their stuffed animal, one they could play with on the internet, and interact with other players online. Children for the first time were able to play with their stuffed animals in a whole new way; they could now play with others for example. Moreover with each stuffed animal you buy you get currency that can be spent in the virtual world, to buy food, clothes and other accessories for your virtual pet. This gave the consumers another reason to buy more pets. Needless to say, it was a huge success in 2007 they had six million visitors to their website a 342% increase than the previous year. 179 Within 24 months of the launch of this new promotion ‘Webkinz’ reported $20 million in retail sales. 180 As more people migrate into the digital era and become familiar with the internet, the more effective and common such activities will be. However they are undeniably effective if done right. During my interview with ‘Little chicken’ Mr. Sala explained how soon the traditional toys we were used to see in cereal, happy meals and toys will start shifting towards digital games.
Don’t start from scratch: One key issue when it comes to virtual worlds is that they are very difficult to create and maintain, therefore advertise in an already existing virtual world, one that is taken care of by another party (servers are very expensive). ‘Second life’ and ‘Home’ are great examples of virtual worlds ready to be advertised on. There are many popular virtual and social interactive worlds out there, already up and running, it is better to research and even invest more money in advertising in a successful virtual world rather than risking developing your own, it would take a long time and cost far too much in the long run. ‘Playstation’s Home’ was created for brands to advertise on, they support the world with advertisements, the gamers do not mind, they were openly told that this world was only possible with advertisements. Furthermore, there are companies that specialize in providing virtual worlds as a platform, namely: ‘Metaplace’ and ‘Multiverse’. 181
178 (www.webkinz.com/us_en ) Homepage of Webkinz 179 (David Edery, Ethan Mollick 2008, Changing the game . p.78) 180 (www.money.cnn.com/magazines/business2/business2_archive/2007/04/01/8403359/index.htm ) Webkiz’s success 181 (David Edery, Ethan Mollick 2008, Changing the game . p.80)
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5.6The possible resistance/dangers to advertising within videogames
Although videogames seem to be a rather effective way to promote a brand, there are areas that could backfire, if the advertiser doesn’t keep in mind possible resistance. Resistance to advertisements in videogames would come from areas that can easily be avoided. Therefore it is important to present the reader with the four main factors that could prevent an advertisement from being successful or even possible.
Developer not interested When it comes to advergames, this is not really an issue; the developer is paid to create your vision. However with in-game advertisement, a videogame developer embarks on making his vision and creativity shine first and foremost, there is known struggles between advertisers and developers. This is a struggle that will always be present when it comes to in-game advertisement.
The advertiser will always try to push their brand, to points that would make it feel like a sponsored game. The developer however wants the advertisement to be a subtle as possible. In some cases advertisers and publishers alike will simply not accept advertisers, because of extra effort to implement the ad (in case of a product placement) or it simply does not fit with the game. On the other hand, there are several types of games (sports, racing) that greatly improve with advertisements; they are therefore very open to advertisers. What it comes down to is: does your advertisement fit the setting? How subtle can it be while still being present? The brand needs to make sense in the developer’s creativity. For this reason games based on the real world, current events, or simply earth have a much higher chance for advertisers, luckily the vast majority of enthusiast games are based in these settings. Ultimately if a developer does not believe the brand matches in his game, money doesn’t even come into question, the advertisement might not be possible. Videogame publishers do have a say however to some extent on the budget of the games and other aspects which would include advertisements. The advertiser would be wise to contact a publisher beforehand (in case of in-game advertising), the publisher in return might be able to increase the budget of the game due to the extra money brought in by advertising which in return the developers can use to further polish their game.
Audience resistance due to intrusive advertisement This aspect directly relates to the point presented above. There have been several cases especially at during the first attempts at in-game advertisement were the advertisers and developers did not realize that you cannot use videogames as other standard forms of media.
In other words, the advertisements were very apparent to the point that they seemed intrusive. When advertising in videogames, one of the most important things to strive for is a natural synergy between the ad and the game, one that benefits both parties, but ultimately must not hurt or take away from the gaming experience. It is a delicate process understandably, since the advertisers rely to a certain extent on how the developers bring it across and implement it. An example of an intrusive advertisement comes from ‘Best buy’ and ‘7-eleven’, these two brands tried to implement their brands into an MMO game called
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‘Maple Story’. 182 183 They didn’t realize the importance of first of all, never implementing a brand into a game not based in reality and second of all, they blatantly placed their brand wherever possible. In some instances, they even integrated their brands into the games ‘quests’, “kill the dragon, get a slurpee” is one of such quests, obviously one can see how out of place it even sounds. Many gaming websites shared their thoughts about these advertisements in one instance calling their actions “this is not cutting edge, this is cutting- stupid.” 184
Many learned from others mistakes however and it seems as though as of late, intrusive advertising in videogames is much rarer, slowly both parties are beginning to understand their demographics, and how they would positively accept ads. Suffice it to say, it is possible for an advertisement to backfire and hurt the brand, which is why it is incredibly important to understand that gamers do not mind advertisements as long as they make sense, throughout the thesis I have given examples of good and bad advertisements, mostly however successful ones as to show ideas that have worked and why.
Over saturation This issue primarily applies to advergames. In-game advertisements do not risk the mass market oversaturation that advergames face. One of the reasons being that advergames, cost a lot less to make and can be distributed almost anywhere, they are easy to maintain and can be made in an incredibly short time. In my interview with ‘Little chicken’ the Dutch advergame company, the president mentioned that one of the biggest issues they will be facing is over saturation. Advergaming is successful, many companies are only now starting to realize this, it will become more and more difficult for advergames to differentiate from each other, and at some point if this because a big trend, money might have to be spent to simply market these advergames.
This is a real issue for advertisers, at the moment a company creating an advergame with smart viral elements, can get satisfying results, but there is the possibility that many more brands will enter the ‘game’ and hence, natural competition for demographics will automatically be created. The best defense an advertiser has against this threat is developing a well designed advergame, with clear viral marketing possibilities, promoting the game through free means also greatly helps, for example in press releases, on their websites, as free gifts in stores. Anything to help spread the game, the aim is to expand as far as possible. The PETA game shown earlier one, might have been shocking and perhaps to many not a fun game, however it did create attention with its controversy, the media picked it up and thousands of people have played it.
Tainted brand image The final point of resistance, also related to bad brand integration can result in negative brand image. Again this final point proves how as an advertiser you cannot simply assume that by knowing what kind of gamer you are targeting the rest is a matter of finding any game. Finding the right game to advertise (in in-game advertising) means finding the right
182 (David Edery, Ethan Mollick 2008, Changing the game . p.42) 183 (www.gamertell.com/gaming/comment/target-best-buy-and-7-eleven-are-coming-to-maplestory ) Maple Story 184 (David Edery, Ethan Mollick 2008, Changing the game . p.42)
~ 79 ~ videogame, to act as the vehicle to the message. For instance in the simplest form, not all brands fit with all videogame types. If you offer washing detergent, perhaps advertising in a futuristic action shooter is not the most natural fit, it would be one that the gamers would immediately identify as just that, and advertisement, rather than an addition to the game. It is not a new trend for brands and advertisers to try to control the way the brand is seen in every possible way, and to make sure, the brand is not tainted in any negative way. It is understandable, for someone paying to promote something to want to have control. When it comes to videogames however, an advertiser needs to learn that a videogame has rules (physics, gravity, mass etc). When an advertiser finds a suitable game to advertise on, one of the most important things to get right is for the ad to feel ‘real’ in the videogame. For the last ten years ‘Gran Turismo’ has provided gamers with the most realistic driving simulation franchise. They managed this partly by having a collection of completely realistic branded cars, which includes occasional static advertisements on the backgrounds. One thing has been bothering gamers however, the cars where indestructible, in fact everything in the game feels ‘too perfect’. The developers presented the excuse that this was due to technological limitations and time issues. However as of this date, every major racing game, have incredibly realistic physics and damage models, meaning that a car crashing is destroyed, a car hitting an object leaves a mark or scar. Unfortunately gamers have started to realize this is likely due to advertising, the next game in the series coming out in 2010 will not change this tradition. 185
It is likely to affect the image of not only the game but the brands when the game comes out, it will be competing with other highly detailed and well produced games that actually include real physics and add to the experience. This is an example of brands not wanting to see their products damaged, in fear that it demeans their image and perception. In contrast gamers would want no more, than for realism, and would not consider a brand when they see a car crash; in fact advertisers could have taken advantage of this to show off their safety aspects.
The other possible factor that could damage a brands image in videogames is with their direct relationship with the game. As mentioned in chapter two, many videogames still have a negative perception to certain groups in the mass market, they are considered violent and unhealthy. A brand indirectly could be affected by these perceptions, and in some groups could be considered as sponsoring violence and unhealthiness. Whether this is true or not is a completely different issue, however it is possible. Advertisers need to consider the consequences that could come from advertising in games. It can be extremely effective, and those that play the games will unlikely complain, however it is the groups that don’t play videogames and perhaps read in the media of sponsoring or branding that will create their own perception. For example, advertising in ‘GTAIV’ would be considered as a holy grail to many advertisers, especially for those trying to reach a young male audience. However the ‘GTA’ franchise is considered a violent one, every game has been covered by the press, groups trying to ban the game and some going as far as claiming that the game directly influences children violently. 186 These groups would definitely take a stab at the brands advertising in the game. Hence it is understandable that some brands would not like to risk this possibility, especially those with conservative consumers.
185 (www.palgn.com.au/article.php?id=8062 ) Gran turismo to not change 186 (www.gamepolitics.com/2008/05/20/jack-thompson039s-gta-vice-city-lawsuit-tossed-out-new-mexico- appeals-court ) GTA lawsuits
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In conclusion it seems and it is true that in-game advertisement can bring about more issues, and generally be tougher to get right. However it can be a huge success if done right, it all has to do with the videogame and advertisement integration, it needs to be natural, add to the experience and do whatever it can to no feel like a paid advertisement.
Advergames do not face many of these issues simply because the advertiser has more direct control; they hire a group of developers or a professional developer such as ‘Little Chicken’ to take care of the needs and wants of the brand. Players playing advergames know they are playing a branded game, their resistance would not come from having advertisements but from not being a good game. Quite simply advergames are generally bad games, making games is very difficult, many companies have tried to create their own games, only to find they were not fun and no one was playing them. Those that have spent time and taken part in the process of creating the advergame ideally with a professional developer have witnessed some of the most cost effective and efficient promotion. 5.7The future of advertising in videogames
Predicting the future is always a daunting task, usually based on patterns and logic, when it comes to videogames much has to happen before a solid prediction can be made. The industry is still very young, and even if advertisers begin to try videogames as a medium it will take time for it to become an established platform for advertising. With this thesis I have presented the reader with an up to date look at the situation that is advertising using videogames with the focus being whether it can be effective or not.
It is undeniable however that some brands have achieved success and investment rises year on year, I believe what we will see in the coming years is an increase in advergaming especially, as brands learn of the success of brands such as ‘Burger king’ and ‘Chrysler’, they too will want to in the very least experiment. Hence there will be many more advergames in the market, perhaps even saturating the market, though that could lead to lower quality, competition and over saturation it would be a clear sign that advergaming has been accepted. In general as videogames become more accepted and important in the entertainment industry, the demographics will keep increasing, and sooner or later as advertisers begin to test the waters, models on costs, boundaries and ethics will have to be made in order for videogames to become a standard and proven form for advertising rather than an exclusive fun alternative, it is at this point that the medium will compete head to head with the standard media of today.
As the casual market becomes more and more accustomed to videogames, their demand for enthusiast games will lead to an increase in enthusiast big budget games, this is a logical cycle and one that helps both industries, new gamers begin with casual games and advergames and eventually enter the enthusiast field.
The success of the videogame industry has only now awoken the mainstream audience and the press; this is a good sign for advertisers as their potential reach will only increase from now on. One perception that will quickly change is the number of gamers out there, whether they notice or not. Because the videogame industry does not have celebrities or events such as TV and film, they do not get the general constant attention that other media do, and
~ 81 ~ because the general public does not hear about videogames in their day to day lives it is generally assumed that videogames are a minor pass time, that a handful of people play. However 9 billion hours were spent playing solitaire in 2003, the most common and simplistic casual game available to us that is equivalent to the amount of hours spent building the empire state building. 187 There are millions of people playing videogames, as new generations arise and become accustomed to the new era of technology including videogames a general acknowledgement and understanding of videogames will come about.
Successful brands and trend setters have already either successfully used videogames for promotion or have openly embraced the idea. This is good motivation for advertisers and marketers not convinced in leaving traditional advertising methods or unwilling to try something new. Their peers are however exploring this medium, many of which have increased their advertisement budget towards videogames rather than TV and as of trendsetters, many would consider ‘Google’ to be a prime example of a brand people from all industries look towards when it comes to innovation, well as of July 2008 ‘Google’ has been buying out in-game advertising agencies, in order to enter the market themselves. 188 Furthermore they are developing new technology to make it easier to advertisers to promote in videogames. ‘Google’ making 99% of their revenue from advertising is at the top of the game when it comes to advertising and setting new trends. This could become a decisive event in this issue.
If there is anything I would like to express in this thesis it would be to in the very least recommend advertisers to test the waters of videogame advertising, start with static in-game advertising for example. The signs that videogames have provided us this far as to their effectiveness as an advertisement platform already show substantial advantages to advertisers, internet advertising has proven to be a great disappointment to most, teenagers and young adults no longer consume standard media, multitasking has made it impossible to know who is engaged or not and most importantly people are tired of advertisements they don’t trust them and do their best to avoid them. Videogames have proven to be a solution to all these issues. The possibility for an audience to experience technical or emotional aspects of a brand in a fun and unforced manner is an approach that frankly no other media has been able to consistently achieve.
187 (David Edery, Ethan Mollick 2008, Changing the game . p.200) 188 (www.maximumpc.com/article/news/google_work_its_advertising_mojo_videogames_soon ) Google entering in-game advertising
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6. Conclusion
This thesis has covered a lot of information, although briefly it can definitely serve as an up to date look at an interesting trend, one that has signs to catch on.
We can now look back and see that the advertising industry is struggling, we as consumers are not receptive as we once were and standard media that had proven reliable and effective for advertisers are no more and have even shown their signs of age. It is a time for new media. The videogame industry has quietly been growing at a very rapid pace to the point where it is about to make the jump to mainstream. Their cultural acceptance has finally welcomed them as an entertainment form for everyone and their sales and growth prove this.
The difference between videogames and other media is clear although they haven’t reached their full potential as an entertainment form and certainly not as an advertising platform they still have benefits that cannot be matched by other media. The power of interactivity and expression that advertisers can tap into is unique, and with the right knowledge and effort can create a powerful promotional tool. People enjoy videogames, people are turning to videogames for entertainment and advertisers should be very busy taking a close look at the possibilities.
Advertising in videogames is still an illusion in that very few have tried, many of which in the simplest form. However this thesis has shown that there are models in place and success can be had, though one must take into consideration the many requirements and grey areas that could decide the effectiveness of an ad.
6.1Re-evaluation of my hypothesis
In truth a lot more detail could have been put into every aspect of this thesis, but alas that was not the purpose of this document. My hypothesis was “Videogames as a platform could become one of the most effective forms for advertising”. Although I am not a professional advertiser and I have never worked in the videogame industry, I believe after reading this thesis back to back, that even in its most logical sense the hypothesis is true, videogames can indeed be an extremely successful form of advertising, it has proven to be. Perhaps however videogames will still require sometime to become a mass marketing tool, at the moment it does not have the mass direct reach that TV has, on the other hand the reach that videogames do have is quality, and the power of interaction has shown that many companies have already turned towards videogames especially advergames as a key source to their marketing efforts.
Personally it is hard to predict what happens next however things indicate to videogames being looked upon as a potential standard platform, if this does continue to happen problems could arise such as over saturation, intrusiveness while on the other hand prices of games might go down and the union might lead to increased realism. Either way change is in its way, and hopefully there are enough experts out there already looking into these aspects, the biggest disappointment would be for advertisers to focus so much on videogames as an advertising tool that they forget what made them special in the first place.
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In conclusion advertisers have a powerful tool in their hands, one that both game developers and consumers are eager to experience and learn more about. Videogames have the potential to become one of the most exciting and effective promotional tools.
6.2The contributions of my thesis
The way I intended people to read this thesis was first of all with an open mind, and to take them through a logical path by showing rather than dictating. By coming into this thesis one should first realize that advertisers need to expand their horizons and explore new possibilities, then see and understand why videogames would be a potential solution while finally learning enough information by the end to feel confident about this medium and even be able to take their initiative from here on and explore it independently.
I believe I have provided a strong up to date overview of this topic, a topic that quickly changes and evolves however I believe this thesis has been written in a stage ideal for discussion, advertisers are struggling and videogames are booming, there could hardly be a better time to inform an audience.
I hope I have been able to inspire some into the realm of videogames not only as an entertainment form but as a new tool that can help promote brands without many of the negative aspects other media are suffering from.
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Appendix
Questionnaire: Casual Gamer
Muriel Philippi 24 years old German
Gaming Consumption
1. Would you consider yourself a casual or enthusiast gamer? MP: Casual definitely
2. How long have you been playing games? MP: Since the days of the NES
3. What systems do you currently own? MP: I have a wii and pc that can play games (though I don’t play games on the pc)
4. How much time do you play on average? (weekly) MP: Oh… well I guess around 1 hour a day on average, so lets say 8 hours a week on average.
5. What do you think of videogames as an entertainment form? MP: Well I like how interactive it is (im talking about the wii), I love the multiplayer aspect of it, I cant think of other media that can make me play with others, it keeps me busy. I find myself addicted to highscores and challenges, I always enjoy topping my scores or others. Depending on what kind of game you play it also helps me to concentrate my coordination, I have seen that games have broadened my interests in music for example through guitar hero, or wii fit for exercises.
6. Do you regularly buy games? How much money would you say you spend a year on software? MP: Well this year actually…we have spent 600 euros on the wii! That is a lot now that I think about it.
7. What genre of games do you play? MP: Non-violent, feel good games, casual not serious, just something I can have fun with but I really don’t like violence…
8. What do you like about videogames as an entertainment form compared to other mediums such as: TV, Radio, Magazines? MP: That you have an influence on what happens, the two way communication, and in real time. Whatever you do in these worlds has no consequences which are fantastic. You can experience these fantasies that simply you cant control in other mediums. Also I can decide when I want to entertain myself, there are no timetables, I decide when I play when I don’t play and when the game ends.
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9. Do you feel that videogames are now more socially acceptable, because of the popularity in the casual market? MP: I still think there is a difference, if you say you have a wii it seems like its more acceptable, if you have a playstation I think people still assume you are nerdy or too into it. They are definitely different markets. But its strange because videogames don’t have celebrities, because you are the star, in tv and music you have stars and they get huge attention. So its strange, that something that everyone seems to play, doesn’t get this ‘hype’.
Advertising in games
10. What is your opinion on brands using videogames to promote themselves? MP: I have nothing against it, because I havnt recognized it. HOWEVER if I was an advertiser I would be very concerned if my brand was in a violent game, the player kills someone then goes and drinks a coke. You need to know exactly who you are targeting to be successful. I really don’t mind in modern games if it adds to the realism of the experience. The games where companies make their own games I think its great, they are free, I don’t feel forced to buy the product. These games are usually pretty bad honestly…it would be nice if they could make games of the standard of the real games, but I wouldn’t like to pay for advertisements, never.
11. Are you aware of advertisements in games? If so can you give examples? MP: No actually I never really noticed. Apart from these modern games I mentioned, but that is simply because I expect them. I have seen a few of these advergames however, from Volvo, Mitsubishi, usually car companies making game.
12.Which of these methods do you think would be more effective? There are two forms of advertising in this industry. ‘Ingame’ and ‘advergaming’.
- In game refers to advertisements within the world of the game such as: branded drinks, branded cars, real world characters or locations etc. - Advergaming refers to games built BY brands. These are advertisements in the forms of games. For example: Burgerking putting small games in their ‘happy meals’ or Toyota putting a free game for their ‘yaris’ brand on the Xbox360 marketplace.
MP: Advergames, you are more busy with the brand and you actually know how many people saw you’re ad.
13. Which of these methods is more appealing to you? MP: second
14. Would it bother you as a gamer to see an increase in advertisements as videogames or in videogames? Please explain. MP: Yeah I think so, it would be very intrusive, at the moment its cool cos they are just there and they make sense. I just want to play the game.
15. What would attract you to an advergame?
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MP: Well id like it to be recommended to me, or I need to hear about it. I don’t look for them, I need to hear about them somewhere.
16. If these advergames came with incentives (such as being free, providing points or discounts) would you be more inclined to play them? MP: Well actually sometimes its nice to play without a reward, it feels less like an ad. Id actually wouldn’t mind expansion packs for games I like, like they add to the experience.
17. What would be the ideal scenario for you? Would you prefer to have no ads at all, even if the make the experience more believable? What if an increase of ads would mean a decrease in price for each game? MP: Id love it if they were cheaper! If its just because of some random ads. I don’t mind ads at all, in some cases I really prefer them.
18. Do you think videogames have an effect on people’s behaviour? MP: Definitely, I can talk out of experience. I have known many people and seen them just get obsessed and alienate. I’m talking socially, hardcore gamers become isolated. I don’t know about violence but I believe it does affect you. You try to be more cool because you see it in the games. It takes the boundaries away.
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Questionnaire: Enthusiast gamer
Martijn Wieriks 23 years old Dutch
Gaming Consumption
1. Would you consider yourself a casual or enthusiast gamer?
MW:Enthusiast 2. How long have you been playing games?
MW: Well, my first gaming experience was on a black and green computer which was in the early 90’s but I got into gaming with the NES and Game boy. 3. What systems do you currently own?
MW: Pc, Wii, Xbox 360, DS and older systems such as Nintendo 64, playstation 1 and xbox. 4. How much time do you play on average? (weekly)
MW: Too much (laughs), including all systems around 15 hours per week. 5. What do you think of videogames as an entertainment form?
MW: I consider it to be pure entertainment and my biggest source. I think it will take over more and more, like a primary form. 7. Do you regularly buy games? How much money would you say you spend a year on software?
MW: Yes! I buy them often enough, maybe 1 game every two months at around 50 Euros each, so around 300+ euros a year. 8. What genre of games do you play?
MW: Action, strategy and shooters those are the games I’m mostly interested in. 9. What do you like about videogames as an entertainment form compared to other mediums such as: TV, Radio, Magazines?
MW: Interaction, being able to have input. Its two way input and the feedback is great. I watch TV and read mostly for information rather entertainment or leasure. 10. Do you feel that videogames are now more socially acceptable, because of the popularity in the casual market?
MW: Yes definitely, but not sure because it’s of the casual market. I think before that even more people have gotten into gamers like hardcore players. But definitely I think in a normal
~ 88 ~ classroom right now almost everyone plays videogames even girls, back in the 90’s it wasn’t so.
Advertising in games
10. What is your opinion on brands using videogames to promote themselves?
MW: I think its very smart business wise. On the one hand it’s a positive development, it means more money for developers too. I worry about invasion however, I don’t want to be ‘spammed’. 11. Are you aware of advertisements in games? If so can you give examples?
MW: No serious ones. Just user made mods for GTA. However now that you mention it, I have noticed a lot of branding in sport and driving games, the banners it’s just part of the realistic gaming experience, and im glad for that, because if it were empty if would be boring.
In the xbox market place there are sponsored games, backed by companies, they are not IN the game but they sponsor them. 12. Which of these methods do you think is more effective? There are two forms of advertising in this industry. ‘Ingame’ and ‘advergaming’.
- In game refers to advertisements within the world of the game such as: branded drinks, branded cars, real world characters or locations etc. - Advergaming refers to games built BY brands. These are advertisements in the forms of games. For example: Burgerking putting small games in their ‘happy meals’ or Toyota putting a free game for their ‘yaris’ brand on the Xbox360 marketplace.
MW: Actually I have not played any advergames simply because they are bad, they don’t have the same effort put into them at least that the impression I get. I’m sure there are a lot of flash games around there. The game needs to be good and an advergaming needs to understand it is a game first and an ad later.
13. Which of these methods is more appealing to you?
MW: Well I want people to make games to entertain me. So I would actually be very interested in companies making good games small games I can download. I’d love to have games be more realistic with brands in them BUT they have to make sense in the world and work in it. 14. Would it bother you as a gamer to see an increase in advertisements as videogames or in videogames? Please explain.
MW: I don’t want it to be annoying or intrusive; it shouldn’t take over and bother. They need to be smart about it. 15. What would attract you to an advergame?
MW: It has to be fun, entertaining. I would be willing to go out and get it if it’s really good. I’d prefer to have it digitally honestly.
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16. If these advergames came with incentives (such as being free, providing points or discounts) would you be more inclined to play them?
MW: Well look with those incentives I would be tempted. I personally really just want to play something fun, but I can see why people would love getting rewarded from playing a game! 17. What would be the ideal scenario for you? Would you prefer to have no ads at all, even if they make the experience more believable? What if an increase of ads would mean a decrease in price for each game?
MW: It just has to be well balanced, it really all depends. I want realism and that means having ads sometimes. I would be happy paying less for a game, but I don’t want it to ruin the experience.
So far actually they have been doing a good job!
18. Do you think videogames have an effect on people’s behaviour?
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Little Chicken interview
Introduction of the company:
Little chicken is a dutch videogame development house, they have been in business for 8 years now, and have been creating advergames for mayor brands. I interviewed the president of the company:
1. What made you decide to get into the advergaming industry?
On a personal level, my brother did in 2000 masters on programming and interactive media. I studied economics, but found it a little dull, so I thought why not make videogames!
2. Was it hard at the beginning to attract companies to use games as advertising?
It was very difficult, today it’s a lot better. We never had a sales team, the only marketing we had was our logo! Our games were generally made for fun, but now they are real advergames, clients come to us easily. Getting into videogames is very difficult you need capital, quality and work. When quality is delivered things will fall into place.
3. What attracted them to create games for their brands? And what held brands back from advertising in videogames say 10 years ago?
The most important thing is measurement. Videogames have fantastic reach vs. frequency models. People have seen the results, and videogames are one of the few media that is constantly used, and people interact with it.
4. What are the key points of an advergame? What makes them successful?
The key element is if you are promoting, you are sending to your target group a message the goal is to consume that message. In games however you make it fun, it is not forced. It’s a cool way to do marketing, people do not feel forced. These are key elements that make it successful. Now it is really a great pull mechanism, with good viral elements an advergame can last for quite a while, making it very cost effective.
5. In your opinion why should a company consider advergames in their marketing mix?
To use videogames in your marketing is something significantly different than your competitors do. It’s difficult but incredibly effective; you can easily create a trade between consumer and advertiser. Research has shown that it increases sales.
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6. On the other side of the spectrum, how do you attract target groups to play these games?
What we see now, is that online people have to find the game, which was tricky. The whole game is placed on various websites; it needs a viral aspect to really be successful. Whatever the company does it would be smart to advertise the game on products or with incentives.
7. If you included sweepstakes, prices and rewards in these games, would the games reach ultimately increase?
It has to be viral. The successful advergames have viral push. It’s expensive to make games; there is no room to spend money advertising the games. It isn’t so difficult to make games viral, leader boards, emails, rewards anything helps, but it must be done.
8. What are your opinions on in-game advertising?
It’s like basically effective, but advergames are more so. I believe so at least. It can be very effective but it’s usually more expensive. I recommend it for bigger brands, like superbowl big brands can afford it, it’s a good tool to remind people the brand exists, for new brands for selling advergames are better.
9. Is in-game advertising another method you have considered or recommended to your clients? Please explain.
Nope! It’s a different field, we strongly believe in advergames.
10. What problems do you face when it comes to resistance from target groups? Are there limitations you have to stick with or specific factors that turn people off?
Casual gamers do not mind. But I understand that hardcore gamers find it harder to accept. You just need to know who you are targeting, that is the issue.
11. If possible could you give an average cost for developing an advergame?
The average, well around 25,000 or 55,000. For extra promotion if the company wants, well that needs negotiation.
12. Advergames can be both online based or directly on disk (although rare), what are your opinions on these two methods of delivery?
Oh yes! Physical distribution can be very effective as well. It gives extra value. Physical seems to have a stronger impact than online. It is definitely something that will be seen in the future, especially with companies that already have distribution channels.
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13. Advergames have undoubtedly become much more common than they once were, so much so that, is the market over saturated with advergames?
Yes I believe so. Internet portals have thousands of games competing is tough. People will have to step it up and be really good. A lot of people are interested in making videogames, there will be big competition, as time goes by developers will have to step up and compete based on quality and innovation.
14. Most gamers, especially enthusiast gamers are not attracted by advergames, they consider them below average compared to what they are used to. How can you change this mentality?
Well hardcore games are considered nerds. Brands that sell products sell them to the general public mostly. Hence when it comes to the internet we generally focus on the casual gamers. It’s easier to satisfy them.
15. Do you believe that the recent acceptance of videogames both culturally and as an entertainment industry has increased the chances for videogames and ultimately advertising in them?
Exactly the Wii and DS really helped with advergaming. We are not just nerds anymore, there is a huge female audience, getting the attention of a customer is much easier now, gamers are accepted, there are millions of gamers play them.
16. Is there a specific target group that your clients focus on?
Generally, 15-25 boys and girls.
17. What is the future of advergaming? Are there new trends emerging?
In the whole it will come together, hardcore and casual will come together hopefully. The casual audience will get used to games and want hardcore games. A new class will be created ‘Middle core’. Games that can satisfy both casual and hardcore needs. And finally…the I- phone! A huge success as a gaming platform, we will definitely be looking into that.
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Advantages and disadvantages of advertising within games
This table is intended to recollect in brief the key aspects and drawbacks of this platform to remind the reader about the main areas that either make videogames an effective tool or not.
Advantages of this medium Disadvantages of this medium General advantages General disadvantages Videogames are one of the most successful Videogames still do not have the mass reach mediums of our generation they consistently potential of Television at least initially grow in all aspects already surpassing other media in essential aspects such as: Time being used, popularity and sales Videogames now are being played by a very Videogames are still considered by a majority large market, a market which the elusive to simply be an entertainment form teenagers can easily be targeted Videogames now cover all demographics: Videogames are still considered by a males, females, young and old significant number of people to be violent and unhealthy Videogames can be played on a large number Videogames as a hole are a young media and of platform, breaking down the barrier of still need to see improvements in many accessibility simply having internet means aspects you can enjoy videogames Videogames h ave a fantastic reach vs. Advertising in videogames will become more frequency recall, it is much easier to calculate expensive, due to their increasing the effectiveness of an advertisement development costs and a demand for more compared to other media quality Videogames no not suffer from a multitasking In the coming years it is possible for the culture, the hours spent playing videogames market to be crowded with all types of are actually spent with focus. videogames giving gamers a broader choice but also giving them an alternative to bypass advertisements Videogames are not considered a sponsored Currently videogame platforms are or advertisement run source of fragmented and almost entirely focused on entertainment, many have turned to satisfying a specific type of gamer. For an videogames because of their unobtrusiveness advertiser this means having a specific target group in mind, and not being able to simply mass advertise to a broad range of demographics Videogames due to the success of their ca sual Advertising in videogames requires attention market are now considered ‘cool’ and an to detail and can be rather expensive essential tool for entertainment by the vast majority. Attracting those who had their doubts Videogames posses the interactive aspect This form of advert ising can hurt a brands that no other media can compare with. The image if the gamers are dissatisfied, although push and pull mechanics (game gives if this happens it is largely due to lack of
~ 94 ~ something to the player and the player effort implementing the advertisement into reacts) makes it a very appealing and fresh the game. Nonetheless it is possible and way to experience, making it a unique way to could be damaging interact with consumers Advertisements in videogames are time less, they might be on the expensive side, but once released a videogame of any form is available to everyone many games constantly selling for a stretch of several years Because of the digital age and technological awareness videogames have over other media, videogames of any kind can be updated at any time, meaning that an advertiser can jump in for specific promotions for a certain amount of time at any point after the videogame is released Videogames generate a much better percentage of positive brand recall than other media In -game advantages In -game disadvantages Already has an established audience or fan Most expensive form of advertising using base, the advertisement would in the very videogames least be exposed for several hours to the targeted demographic Most games take several hours to complete, It can take years of preparation to implement enthusiast games are those who generally use a product placement in a videogame, which in-game advertising, meaning the average can be risky if the game is delayed consumer is exposed for 5-10 hours on average Though generally expensive in -game The game the advertisement is placed in advertising can be done to suit smaller could directly affect the image of the brand, budgets, for example placing billboards, logos which could end up offending a certain and posters is rather cheap compared to demographic of the brand. integrated product placements. Enthusiast gamers hold the largest If the advertisement is not subtle or adds to demographic of young adults giving the videogame experience, the gamers might advertisers finally the possibility to target find it intrusive them in a medium that demands engagement Enthusiast games give advertisers the In -game advertisement means that for people possibility to represent their brand or to see your ad they need to buy the game product in highly realistic detail for millions first, limiting the potential audience. of people to interact with. Furthermore it is Furthermore the only medium where you can prototype a product before it is even on sale Advertising in videogames can greatly help In -game advertising requires up to three differentiate a brand from competition not different parties being involved simply to only by doing something original and negotiate on the idea, process can be long
~ 95 ~ entertaining but by being exposed to gamers and requires constant communication and on an emotional level by knowing the tastes negotiation that their demographics are after An advertiser has to rely partly on the videogame to be good and successful, it is important to research who is developing their game and what the expected sales will be, the developers failure to make a good game can affect an advertisers success. Advergames advantages Advergames disadvantages The best way to communicate a brand to a Seeing how the primary platform for consumer is to let them experience it, this is advergames is the internet, one must really one if not the most effective way to do so stand out to differentiate from the rest, viral marketing of the advergame is a must have The advertiser can craft exactly how the The popularity of advergames and games in videogame should come across general will see more companies and advertisers using this form in the coming years, which could potentially lead to over saturation Advergames are cheap to make, and don’t Advergames are generally considered inferior require maintenance, furthermore their viral games especially to enthusiast gamers. elements help these games advertise Meaning that it is the casual gamers that themselves should be an advertisers primary target group Advergamers are the only form of Adve rgames still need to be fun and well advertisement that provides important two designed, many advergames focus too much way communication between the gamer and on the advertisement rather than the game, the advertiser, this not only provides the hiring a videogame developer or advergaming advertiser with important information about agency is almost a necessity to tackle this the gamer themselves but also acts as an issue indirect way of doing behavioural research, one can find by the way the gamer plays the game or the choices they make, how to make a brand more effective Advergaming gives the advertisers a chan ce Because of the casual nature of these games, to represent their brands in a virtual way the advertiser must create a short, engaging while having the possibility to cross it over to and entertaining message and videogame all the real world. One can provide incentives for within a few minutes. The primary target of those playing the game, to go out and reach advergames are casual gamers who seek out to the advertiser’s brand. This can be short and quick entertainment, meaning that done through incentives and prizes there is a time limit in a sense to promote the brand and all the messages you’d want to get across Advergames can be distributed physically alongside an already existing product, making it a cost effective incentive and easy way to distribute these games
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Bibliography
Literature David Edery, Ethan Mollick Changing the game . FT press, 2008 George E. Belch, Michael A. Belch. Advertising and Promotion. Mcgrow hill, 2004. Kotler. Principles of Marketing. Financial Times, 2005. Marolf, Gerald. Advergaming and in-game advertising. Dr. Muller, 2006. Yadin, Jefkins &. Advertising. Financial times, 2000.
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www.webkinz.com. www.woolfenden.com. www.worldofwarcraft.com. www.zonalatina.com.
Other resources:
Interviews Martijn Wieriks interview - Enthusiast gamer Muriel Philippi interview - Casual gamer Little Chicken interview - Advergaming Company
Podcasts Joystiq podcast 1-up Podcast
Blogs "Advertisement exposure.pdf." adverlab.blogspot.com/search/label/in-game blog.aapglobal.com/category/in-game-advertising/ Groundswell: blog on new technology www.secretlair.com/index.php?/clickableculture www.businessandgames.com/blog/
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Table of figures Figure 1 Pong, the first arcade machine ...... 8 Figure 2 Gender ratio of gamers ...... 12 Figure 3 Age ratio of gamers ...... 12 Figure 4 Worldwide sales - January 2009 ...... 14 Figure 5 Anti videogame ad ...... 18 Figure 6 Lipton advertisement from 1893 ...... 22 Figure 7 Axe commercial playing on simple emotions ...... 24 Figure 8 AIDA model ...... 25 Figure 9 Media usage in the US ...... 27 Figure 10 Hourly usage in Europe ...... 28 Figure 11 madden 09 ...... 30 Figure 12 Media costs comparison ...... 33 Figure 13 Communication flow ...... 36 Figure 14 From controllers from left to right: Xbox, Wii, PC Mouse ...... 39 Figure 15 Empire: total war, players must battle against each other during the 18th century ...... 41 Figure 16 World of goo, one must go from A-B connecting blobs ...... 41 Figure 17 Second life, a social interaction focused game ...... 42 Figure 18 Solitaire, a casual low engaging game ...... 42 Figure 19 Fight night 4, boxing simulation game ...... 43 Figure 20 Burnout paradise, a fast and exciting driving game ...... 43 Figure 21 Ipod in Metalgear Solid 4 ...... 45 Figure 22 Splinter cell's Sony Ericsson phone ...... 47 Figure 23 Differences between enthusiast and casual gamers ...... 53 Figure 24 Characteristics of enthusiasnt and casual games ...... 55 Figure 25 Gamer VS Game paradigm ...... 56 Figure 26 GTA IV ...... 56 Figure 27 World of warcraft ...... 56 Figure 28 Rolando ...... 56 Figure 29 Wii play ...... 56 Figure 30 Porsche in 'Need for speed' ...... 56 Figure 31 Obama campaign ad ...... 56 Figure 32 Cooking mama: Mama kills animals ...... 56 Figure 33 The Sims ...... 56 Figure 34 PHILLIP's in Brothers in arms: Hell's highway ...... 56
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