Ad spending on social gaming increased 60% since 2009, according to eMarketer. No doubt advertisers have noticed that 56 millionAmericans are playing social games and that the branded virtual goods market is booming. But more than just social gaming’s growing popularity has gotten attention from advertisers. Social games also represent an environment that is largely conducive to advertising.
“Media buyers and advertisers are recognizing that this is what they want,” explained Robert Tomkinson, Playfish’s senior director of global marketing. “What they want is massive reach, they want targeting, they want performance. And you can have all of these by forming branding opportunities in the right way.”
Tomkinson and other leaders in the social gaming industry recently spoke at the Social Gaming Summit about the huge opportunity that social games represent for brands. Here are five reasons they gave for why social game advertising is a growing success:
1. Advertising in Games Is About Engagement, Not Eyeballs
Back in July players of the the most popular Facebook social game, FarmVille, had for the first time an option to plant a specific branded crop — Cascadian Farm blueberries — on their virtual farms. In more than 500 million cases, players chose to purchase and plant the branded blueberries instead of something else. According to Zynga, unaided brand awareness increased 550% as a result.
Volvo, H&M and MTV Networks have also experimented with branded virtual goods that users can choose to purchase or acquire through interaction with the brand.
Another common strategy for brands in social games is an “offer wall” inside of many games. Brands can exchange virtual rewards for engagement, like taking a survey or watching a video about a new product.
“In both cases you’re actually engaging with the brand,” explained Peter Wexler, the director of strategic partnerships for transactional advertising platform TrialPay. “This is different than in traditional ads within TV and print and on the side of the bus that flies by on Eighth Avenue. That’s all sort of eyeballs, so how many eyeballs do I have on a magazine, on a paper… you can vary on actual engagement.”
2. Social Games Reach the Facebook Audience
When online, the average American spends more time on Facebook than on Google, Yahoo, YouTube, Microsoft, Wikipedia and Amazon combined. A significant part of that interaction includes social games, making them an ideal alternative to display ads for advertisers who want to reach Facebook’s giant, 500 million-person user base.
“If you talk to advertisers, and you talk to them about Facebook, every single one of them, whether it’s an agency or the brand, they’re all extremely interested in participating in the Facebook platform,” explained Wexler during his presentation. “And most of them are pretty unsure of how to effectively do that… this is where consumers are available.”
3. Some Games Have Bigger Audiences Than Prime Time TV
Advertising in social games might not be solely about eyeballs, but there are definitely a critical mass of people who are playing them. About about 30 million players per day play the most popular social game, FarmVille. The most popular prime time television show last week, Dancing With the Stars, had about 24 million viewers.
Social gaming is becoming just as accessible, if not more accessible, than television. While most gaming platforms in the past have required expensive consoles and other barriers to entry, most social games are free to play.
“[The] iPhone put a gaming device in everybody’s pocket and massively expanded the market,” explained Tomkinson during his presentation. “And of course, free-to-play social games massively expand the market to bigger than all the console games combined. This is something that anybody can use.”
In addition to broaching television’s audience size, social games are also broadening the niche that is often associated with gaming. Most games are fairly easy to learn. Zynga game tutorials, for instances, are shorter than three minutes.
Zynga’s director of brand advertising Manny Anekal said in a presentation that he hates the term “social games” because the experiences that his company creates are “just fun with your family friends. Simple as that.” Being such, social games can easily reach demographics far beyond the typical “gamer” profile.
4. Advertising With Social Games Isn’t Restricted to Virtual
The branding potentials for social games need not remain online. About six months ago, 7-Eleven straddled the space between virtual and physical worlds by tying products like iced coffee and slurpees with FarmVille Games. When a customer bought a promoted product, he or she was directed to perform a task in the game to unlock a 7-Eleven virtual good.
The campaign ran in 7,000 stores for six weeks. The branded ice cream surpassed the brand’s sales forecast within the first week. More than 3 million codes were redeemed, and water had a 60% redemption rate.
Green Giant also explored the space in between virtual games and the physical world by giving away FarmVille Cash with select produce purchases.
5. Brands Can Be Part of the Experience
In “virtual world” games, brands can do more than hang out on billboards (though that is an option, too). They can become part of the game.
One way brands have done this is to add an element to the gameplay itself. When Farmers Insurance branded a blimp in the FarmVille game, for instance, players who chose to put it on their farms had their crops protected during the 10 days of the promotion. The branded blimp continued to float over their farms even after the promotion was over.
Another way brands become part of the experience is by adding an interactive component to the landscape. On Black Friday, Old Navy launched a virtual store in CrowdStar’s social game, It Girl. Players could purchase Old Navy virtual clothing or gift it to their friends. The virtual store displayed real-world offers, and players could also complete quests that would earn them virtual currency.
“They’ve very much integrated their brand into the game experience,” Wexler said about the integration. “It’s not so much about transactions and direct revenue for Old Navy in this situation, it’s about putting the brand in front of their customer base.”
6. Brands Can Reward Players for Interacting With Them
Purchasing the Farmers Insurance blimp gave FarmVille players protection, completing quests in the virtual Old Navy store gives CrowdStar players virtual currency, and watching videos or taking surveys on offer walls will earn virtual currency or goods. In some cases, players can choose between paying to play or engaging with a brand in order to play a game for free.
“The player gets the reward by interacting with the brand. This isn’t about showcasing, it’s about engagement,” Wexler explained during his presentation. “And that’s the value to advertisers.”
COMMENTARY: You know, I am not so convinced that social games are going to be the huge advertising bonanza as portrayed in this article. If you've been following my blog posts (see under the GAMES category), I am not alone in this, most advertising and social media experts don't think so either. Compared to traditional advertising, social media is but a sliver.
I also believe that the advertising supported business model used by social networks is busted. It is very difficult for any social network, especially Facebook to make any money off of advertising alone. It really needs a flurry of revenue streams because I don't believe a social network can make a profit strictly off of ads. When it takes 500 million members, and most experts predict that Facebook will do $1.8 billion in revenues, that's a lot of work when compared with Google.
If Facebook wants to grow advertising, it is going to have to open the music box, and allow its members to run their own ads, not just in the classifieds, but on their home pages.
Courtesy of an article dated December 5, 2010 appearing in Mashable/Business