Gaming advertising refers to a range of strategies and digital ads designed for video games and their audiences. From traditional ad placements to interactive ad formats, in-game advertising unlocks a wealth of data, global reach, and ride-or-die loyalty to give your brand a winning edge.

The gaming community isn’t just a bunch of teenagers playing Call of Duty. 

Today it consists of about 3 billion people, split almost evenly between men and women. That’s a huge, diverse audience just waiting to see your gaming advertising.

Today’s video game scene unlocks massive opportunities for digital marketers to tap into a rapidly growing market. So, what can you do to level up your strategy and score big?

In this guide we’ll discuss everything there is to know about advertising in the gaming industry. Keep reading to unlock the cheat codes.

What is gaming advertising?

Gaming advertising refers to a range of marketing strategies and digital advertisements designed for video games and their audiences. 

This form of advertising includes traditional ad placements within games, and interactive ad formats and strategies to engage players directly. When done right, gaming ads simultaneously enhance the gaming experience and promote your brand’s value and products.

Today’s gaming ad strategies typically fall into one of three approaches:

  • In-game ads: The ad seamlessly integrates into the gaming experience, whether intrinsically as part of the game, positioned adjacent to gameplay, or as interstitial (brief, transitional) moments (e.g., logos on avatar apparel or cars from well-known automotive brands).
  • Around the game: The ad exists within the gaming ecosystem but operates outside the confines of the actual gameplay (e.g., billboards on streets in racing games or branded banners around the gaming environment).
  • Away from the game: These ads target the gaming audience outside the direct gaming environment (e.g., sponsored gaming industry events, eSports, or streamer ad buys).

The goal? Make an impact without interrupting all the fun.

Child playing video games

With gaming advertising, you aren’t limited to one or two marketing options. (Image: Rawpixel)

10 reasons to invest in gaming advertising

This year, the active gamer count is set to hit a staggering 3.32 billion worldwide. In other words, it’s prime time to leverage the immense potential of gaming advertising for increased brand engagement and visibility.

Let’s zoom in on the game board and see what makes these 10 factors so crucial.

 1. A goldmine of data

The gaming industry, primarily mobile gaming, produces a hefty chunk of data. This lets you accurately target audiences based on age, gender, geography, device, interests, etc.

How do game developers gather these insights? They mainly focus on player interactions and behaviors within the games, such as:

  • Player profiles and accounts (which include demographic and location data)
  • In-game behavior tracking (gameplay decisions, popular items, player preferences)
  • Device information (brand, model, and operating system)
  • In-game purchase history (what players spend money on and how much
  • Social media and integration (with accompanying data from social networks
  • Surveys and feedback prompts (within the game or via emails
  • Real-time analytics tools (includes engagement and game performance metrics)

At HawkSEM, we harness our proprietary tech software ConversionIQ to keep real-time tabs on all these juicy metrics. 

You know what else all this data tells us? Gaming audiences are super diverse.

 2. Impressive audience diversity

Now that we’ve debunked the old-school stereotypes of gamers, you can get to know who’s really playing in today’s gaming space.

Modern-day gamers span all ages, incomes, behaviors, backgrounds, and other demographics.

Here’s a peek at the diverse players engaging with your ads:

With these insights, you can tailor your ad campaigns to speak directly to different segments of your target audience.

Global reach + laser-sharp targeting? Now that’s a winning combo.

 3. High engagement levels

When gamers are in their element, they’re not just passively scrolling or half-watching. They’re fully dialed in, completely immersed in their gameplay. That’s why the gaming environment tends to see better engagement rates than traditional media.

Gamers actively interact, make decisions, and experience each game’s storyline. This kind of engagement creates a unique space where ads can truly resonate. Instead of being background noise, they can be part of the action, catching players when they’re most attentive and responsive.

Take Fortnite’s innovative brand collaborations. By integrating popular franchises like Marvel into its gaming universe, Fortnite goes beyond basic ad display; it creates a fun, immersive experience.

(Image: Fortnite + Marvel gameplay example)

Players don’t just see a Marvel ad—they get to interact with Marvel-themed content, from character skins to unique storylines. This level of interaction drives higher engagement as players actively participate in a branded experience seamlessly woven into their gameplay.

Branded character skins are cool, but they’re just one of the many ad formats out there.

 4. Various ad formats

The beauty of gaming ads is that you’re never limited to one or two marketing options.

Earlier, we touched on the three categories gaming ads typically fall into. Within those categories, there are four popular formats:

Reward ads

These are ads that trigger in-game rewards once players watch them to completion.

Ever ran out of lives on the mobile game “Candy Crush Saga?” does this by allowing gamers to watch video ads in exchange for rewards, like additional lives. These video ads are usually optional and non-intrusive, respecting the player’s choice and gaming experience.

(Image: Candy Crush Saga ad example)

Interstitial ads

Gamers see interstitial ads while completing a certain level or task during gameplay.

If you’ve ever played “Subway Surfers” you’ll see these when your character crashes, and the run ends. The loading screen features ad snippets with the option to watch the full video for rewards (like reviving the character or in-game currency).

(Image: Subway Surfers ad example)

Display ads

These ads appear along the top, bottom, or sides of the screen without disrupting gameplay.

For example, “SimCity BuildIt” has ads placed on billboards within the cityscape. They showcase different brands and products, appearing along the game environment as players navigate the city. 

(Image: SimCity BuildIt ad example)

Advergaming

These are built-in ads that either promote products within or become an integral part of the game itself.

In the “Need for Speed” video game series, most cars and accessories are from real-life brands. Players can drive cars from companies like BMW or Porsche, effectively turning the gaming experience into subtle product placement for these auto brands.

(Image: Need for Speed product placement example)

And with so many gaming platforms, you have plenty of channels to flaunt your ads.

 5. Multiple advertising platforms

In-game advertising stands as its own unique marketing niche. And thanks to the diverse array of platforms available, there are equally diverse avenues for your brand to make its appearance.

The most popular include:

  • Metaverse
  • PlayStation
  • Nintendo
  • Xbox
  • Apple Arcade
  • Microsoft
  • Roblox
  • YouTube Gaming
  • Google Stadia
  • Mobile games

How to choose the right gaming platforms

Each of these platforms is its own ballgame when it comes to audiences and how to get your ads in the game. It’s important to consider:

  • Your target audience: Different gaming platforms attract different age groups, genders, and interests. For example, platforms like Roblox or mobile games might be ideal if your target audience skews younger.
  • Game genre and context: Align your brand with games that fit your product or service. If you’re promoting sports equipment, a sports-themed game would be a natural fit.
  • Marketing budget: Different platforms vary in cost. Weigh the potential reach and impact against your marketing budget.
  • Brand safety: Choose platforms that align with your brand’s image and values. If your brand promotes family-friendly products, opt for games with appropriate content.
  • Platform popularity and reach: Popular platforms with large player bases offer more exposure but can also be more competitive and expensive.
  • Analytics and targeting: Platforms with in-game analytics and targeting options let you tailor and track your ad campaign more effectively.
  • Latest trends and innovation: Gaming trends and tech are constantly evolving. Stay in the loop on emerging platforms or new ad formats for unique opportunities.
  • Competitor activity: Peep where and how your competitors are advertising. This can give you insights into effective platforms and potential gaps in the market.

Since gamers are fully immersed in gameplay, your ads pave the way for your brand to be part of a memorable experience.

 6. Top-of-mind brand awareness

Gaming advertising creates an opportunity to put your brand in front of a target audience that’s most susceptible to absorbing information. 

For starters, gamers probably aren’t multitasking, which increases the likelihood of brand recall and awareness.

That’s because gaming often puts players into a “flow state.” This is when they’re in the “in the zone,” so immersed in the present activity (like gameplay) that negative anxieties and stressors fade into the background. And since these ad experiences don’t disrupt the game, they don’t disrupt your audience’s flow state either.

By tapping into this flow state, your in-game ads leverage the high engagement levels, positive emotional context, and targeted nature of the gaming audience to create impactful and memorable brand experiences.

This top-of-mind brand awareness can expand your target audience, increase website traffic and brand affinity, and drive consumers further down the purchasing funnel.

Now that’s some immersive ad play.

 7. Unique competitive edge

Not long ago, only a few companies tapped into gaming advertising. About three-quarters underestimated the gaming market, while 60% didn’t understand gamer demographics.

But we’ve come a long way since then, and trust us—no one’s sleeping on in-game ads anymore.

Today, the advertising industry understands how powerful video games are. They create a competitive edge for brands to tap into the daily entertainment of their audience. This offers a unique blend of visibility, engagement, and interaction that traditional ads can’t match.

One brand that took note and ventured into the gaming world was Balenciaga. 

They created an exclusive line of in-game apparel and accessories for characters in the Fortnite video game. This allowed Balenciaga to access Fortnite’s massive, engaged audience with a fresh, interactive experience beyond traditional advertising.

(Image: Fortnite + Balenciaga ad example)

The move paid off, increasing searches for the luxury fashion house by almost half.

The best part about gaming ads? You don’t need Balenciaga’s $100 million marketing budget to play to win.

 8. Cost-effective marketing

According to Search Engine Land, gaming ads are one of the most cost-effective forms of marketing.

Let’s check out the average ad spend for different in-game advertising:

  • Static ads: These ads are permanently programmed into a game’s storyline during development. Like product placement in movies or TV shows, the ad is there forever. The price can range between $50,000-$500,000.
  • Dynamic ads: This allows real-time insertion of customizable ads (like billboards or banners) in video games. The cost per thousand impressions (CPM) for dynamic ads is around $4-$12. 
  • Advergaming: If you want your brand to become an integral part of the game, expect to pay a premium. In fully developed console games, costs can soar into the hundreds of thousands or more. For flash and mobile games, you could spend around $15K-$100K+.
  • Console integration: While not an in-game channel per se, this is considered a highly effective way to reach gamers—so it earns a spot on the list. These ads appear as square tiles on the Xbox Live dashboard. The CPM is higher, ranging between $25.00-$35.00.

To nail the best fit for your budget and goals, consider each ad format’s audience reach, engagement potential, and cost-effectiveness. You want an ad type that resonates with your target demographic while staying within your financial means.

 9. New influencer opportunities

Gamers don’t just play games; they like watching others do it, too. Twitch, the world’s largest video game streaming platform, has over 140 million monthly visitors.

Imagine that—a digital arena filled to the brim with gamers from around the globe.

Now, think about the top-tier video game players with millions of subscribers. With influencer partnerships, you can tap into their subscriber base and show your ad campaigns to millions of potential prospects.

One brand that crushed influencer marketing? 

KFC teamed up with Twitch influencer DrLupo for a live-stream event in PUBG: Battlegrounds (a battle royale game). During the stream, KFC gave away $20 gift cards to promote their tasty new chicken wings.

(Image: Twitch influencer ad example)

Winner, winner, chicken dinner indeed.

 10. Increased brand loyalty

Video game players are fiercely loyal to their favorite games. And when your brand appears in the same universe, you can turn that passion into lasting loyalty for your business, too.

Let us remind you of the power that brand loyalty has. Though these customers tend to buy less, the profit margins on their purchases are no small potatoes.

When gamers encounter a brand in their beloved gaming environment, they don’t see it as an ad. It’s an extension of their gaming experience. This is why brands that successfully integrate into games often see a significant return on investment (ROI) and more loyal customers.

Sure, they may make fewer purchases, but let’s not undercut the value of their devotion. In fact, one study found 47% of gamers are more likely to shop from brands they recognize from their gameplay.

But like any good game, you’ll have to dodge some challenges on your way to cult fandom.

Challenges of in-game advertising

In-game advertising opens the door for innovative and creative ad campaigns, but you should be aware of some potential drawbacks:

  • Gaming is a dynamic industry. Like any industry, it’s important to keep tabs on all of the new trends and industry projections. Staying on top of all of this requires a keen eye for market trends and being able to pivot and implement new, targeted campaigns on the fly.
  • Poses delivery challenges. Gamers are passionate about the gaming process and view everything that tries to interrupt it as a nuisance. (This isn’t dissimilar to sentiment around pop-up ads, for example.) It’s not always easy to serve ads in non-obtrusive yet effective ways.
  • Regulatory compliance is vital. The Interactive Advertising Bureau (IAB) is an American agency that regulates the online advertising industry. It’s important to stay up to date on these regulations in order to stay compliant, and therefore remain an active player in the game.

The takeaway

By 2025, the global gaming market is projected to grow by a whopping $90.8 billion annually. In other words, in-game advertising is ground zero for fruitful, innovative marketing.

At HawkSEM, we’re no strangers to making high-powered digital marketing plays in the gaming universe.

Ready to press play on record-breaking ROI? Your quest begins here.

This article has been updated and was originally published in May 2022.

Christina Lyon

Christina Lyon

Christina Lyon is an entrepreneur and writer from sunny SoCal. She leads Lyon Content, a tight-knit team of bold creatives, and crafts engaging written content that helps brands sparkle and scale.