More brands are assessing in-game advertising, a market forecast to reach close to AU$200 billion this year, as a destination for budgets.
At an event by game advertising platform iion to celebrate the advancements game advertising made in 2024, AdNews spoke to attendees about the opportunities for 2025 and whether brands, agencies or platforms will play the biggest role in increasing the take-up of the sector.
Menulog's digital media manager, Benjamin Malfatti, said cloud-based gaming will provide a huge opportunity for gaming advertising in 2025, making AAA gaming (games made by the biggest, most notable studios) more accessible for casual gamers.
“For example, Xbox now integrates into new Samsung monitors and smart TVs, so consumers can access a vast library of free streamable games through Xbox Game Pass without the costly payment for the console itself,” he said.
“This can offer innovative ways to present ads that are less intrusive and more contextual within the gaming experience.”
GroupM Nexus’ GM of product, Dylan Dharmadasa, said that while the agency's This Year Next Year Media Forecast for 2025 suggests that whilst there’s over $100 billion in revenue globally for the top gaming publishers and distributors, GroupM’s estimates suggest only about 6.5% of that revenue is earned from gaming advertising.
“By far this is the biggest opportunity for gaming publishers to seek new revenue streams and reach new and diverse audiences,” he said.
Globally, the market for video game revenue reached US$196 billion in 2023, more than the combined revenue from streaming video ($114 billion), streaming music ($38 billion), and global box-office receipts ($34 billion), according to Bain’s 2024 Gamer Survey.
More locally, the Australian video game industry itself generated $345.5 million in income in FY23, an increase of 21% over the past financial year, according to the eighth annual Australian Game Developer Survey (AGDS).
Scroll Media’s digital sales manager, Costa Panagos, said the biggest potential is lying at the intersection of emerging technologies, evolving consumer behavior, and strategic market gaps.
“The greatest opportunities likely lie not only within in-game advertising, immersive experiences and the gamification of non-gaming brands, but also in mobile gaming's continued growth,” he told AdNews.
“We're seeing mobile gaming continue to dominate the Australian gaming market in terms of player numbers and as we continue to educate brands and agencies, more interest has been shown – for example, with Macquarie Uni interested in jumping into the gaming market.
“Plus, with low barriers to entry and high engagement levels across all demographics, I truly believe we're in for a huge 2025 in the gaming space.”
Flashtalking by Mediaocean’s MD, Georgia Brammer, said that bridging the gap between media and creative will be how brands see success in the gaming space heading into this year.
“With such rich and valuable data at hand through gaming, it’s critical that brands capitalise on this with the right message,” she said.
“According to McKinsey, 71% of consumers now expect brands to deliver personalised experiences. Given the sheer diversity in audiences, means and moments of interaction with consumers within the gaming space, it’s critical that marketers are partnering with interoperable, cross-channel and scalable solutions to unlock the true potential of gaming advertising.”
Samba TV Australia MD Yasmin Sanders said as audiences continue to splinter across platforms, gaming provides advertisers with a high-attention and immersive environment to have meaningful connections with hard-to-reach audiences, making it a critical channel for engaging elusive audiences.
“The key opportunity is positioning gaming as an always-on strategy demonstrating incremental reach, ROI and reaching diverse audiences cementing gaming as an increasingly growing medium for share of ad dollars,” she said.
IAB’s 2023 Game Advertising State of the Nation report, which surveyed 100 advertising decision makers working in agencies and brands in Australia, found 25% reported regular usage of gaming advertising, with 68% in total saying they had used game advertising in 2023.
More than half (52%) said they had increased gaming advertising activity over the past year with 72% intending to increase activity in 2024.
The take-up of gaming advertising isn't just the responsibility of a single platform or a heavily leaned-in brand though – it’s a collaborative system that involves both advertisers and agencies working together to increase investment in an area that’s long been touted as under-utilised relative to the possible benefits for those involved.
Sanders said that she predicts brands will come to adopt gaming as a high-attention, always-on channel, and agencies will help guide strategies to integrate gaming into broader media plans.
“Collaboration [among brands, platforms and agencies] will ensure gaming advertising gains mainstream adoption and achieves measurable outcomes for brands in 2025,” she said.
Brammer said as with any emerging tech, the platforms play a critical role in education, breaking through misconceptions of what typical gaming audiences are.
“In turn, we need investment and focus in trialling and scaling from both brands and agencies - continued consumer investment in gaming will mandate this,” she said.
One example of this from last year came by way of Roblox, who released video advertising on its online game platform after six months beta testing with dentsu, Omnicom's Hearts & Science and Warner Bros. Pictures.
Although the video ads on Roblox at time of launch weren’t clickable, advertisers could use ad content to share methods of contacting or discovering their business entities, products or services, or professional content.
The video ads also come with expanded controls and features like genre targeting, brand suitability and an audience estimator.
Menulog’s Malfatti, meanwhile, said that platforms will play the most crucial role in expanding game advertising into 2025.
“They have the technology, data analytics, and user base, which positions them uniquely to offer targeted and effective advertising solutions,” he told AdNews.
Dharmadasa said that due to significant evolution across the large gaming platforms with the consumer experience changing like never before, there are opportunities for both agencies and brands to lean in and innovate.
“The likes of Xbox and Netflix launching console-free gaming experiences is making gaming easier for a wider range of consumers to access,” he said.
“Combined with getting the boring basics right, advancements in ad serving and programmatic buying maturity in gaming will be the critical factors to advertising growth in the sector."
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