Top 3 predictions for the future of in-game advertising

With global economic uncertainty, 2023 will prove challenging for the gaming and ad industries, and it will be a difficult task to predict what the next twelve months will have in store for in-game. To help, we called upon some of the gaming and advertising industries’ leading experts and collated their predictions into these three key areas.

1. The industry will unite to protect gaming against fraud

Since the launch of the first banner ad, fraud has been a massive problem for the digital advertising industry. Due to the complex nature of gaming, intrinsic in-game advertising fraud rates and IVT are extremely low compared to other digital channels. Still, as more ad dollars flow to this channel, the fraudsters will inevitably follow.

It’s not all doom and gloom though. Kristine Lopez, director of product management at HUMAN, believes that “in 2023, we will continue to see clever and collaborative ways to fight fraud and keep the gaming space safe by gaining signal and increasing the adoption of thoughtful standards.”

One thing which will be key is working with the right partners, and “brands must do their homework before entering the in-game environment. Focus on well-established partners who had worked with in-game advertising ‘before it was cool,’ and have the tools and expert knowledge to execute the latest in-game features and protect campaigns,” reassured Gabriele Vileikyte, product manager for Eskimi.

Michael Isaacs-Olaye, business development lead (EMEA) for IAS agrees that “we will see brand safety become the most important feature in overcoming barriers to utilizing the space, and that 3D viewability and IVT verification will help ease marketers' concerns.”

2. 2023 will be a break-out year for in-game

Much of 2022 was spent continuing to lay the groundwork for in-game advertising, and part of this was the publication of the updated intrinsic in-game advertising standards from the IAB and MRC. According to Michael Reidy, senior vice president of digital ad sales at NBCUniversal Media, “In 2022, marketers trod carefully as the industry raced to operationalize stronger measurement and brand safety solutions for in-game advertising. But that is quickly changing. The combination of an increasingly broad gaming audience and tech stack maturity will make 2023 a breakout year in terms of media spend devoted to the gaming space.”

Scott Curtis, global head of digital ad spend for Spark Foundry, echoed Reidy’s sentiment. “I would be shocked if in-game did not continue to gain traction throughout the coming year, with greater awareness and adoption from both agencies and clients understanding the attention benefits and all the effects it has on branding.”

This year, in-game will also become the go-to business model for many more game developers, providing advertisers with even more exciting gaming inventory to plug into. “With direct consumer spending having softened, game makers and platforms will be looking to monetize their audiences indirectly and build a stronger relationship with advertisers and brands,” predicted Joost Van Dreunen, video game academic and NYU Stern professor.

3. In-game will continue to transform the way advertisers engage with audiences

Intrinsic in-game advertising has flipped the traditional ad format on its head, producing an ad medium that complements the experience and, in many ways, enhances it. The realism that in-game ads bring to gaming environments, and the creative opportunities that the 3D world offers advertisers, have resulted in new ways for brands to engage with their audiences.

“Mobile gaming advertising has traditionally been very direct response-led, trying to push audiences outside of the environment to complete an action like ‘install an app’,” said Ivan Kudrinski, publisher development (mobile) at Pubmatic. “With games offering more premium and high-impact formats, we should start to see a much more immersive feel to how brands communicate to audiences within games, hitting more brand KPIs rather than just performance.”

IAB’s VP Experience Center, Zoe Soon, also believes that gaming will continue to change how brands engage with their customers, and that many will look to this medium to understand and learn what might be possible within the metaverse. “Covid accelerated a shift in consumer behavior and an openness to many activities once considered in-person only – such as virtual concerts and virtual try-ons. As this shift takes place, and flat digital experiences make way for more virtual spaces and interactive media, we will look to how gaming handles things in 3D environments. Once advertising's red-headed step-child, gaming will have the opportunity to lead.”

“We also predict that consoles will begin rolling out new inventory in their gaming ecosystems as interest in the space starts to take off,” added Issacs-Olaye. He has a strong point, console is poised to have a big year in 2023, with both Xbox and PlayStation set to bring in-game advertising to their platforms, engaging with consumers in beautiful AAA gaming environments on large living room screens will become a hugely attractive proposition for advertisers. It will also significantly impact how brands connect with their audiences.

These insights were taken from Anzu's “What Does 2023 Hold For In-Game Advertising” report. To hear more from these experts and others, download the report for free here.