The global in-game advertising market, which generated $77.7 million globally in 2006, continues to develop at an exponential rate, according to new research from Yankee Group.
By 2011, Yankee Group says that worldwide in-game advertising expenditures (fixed product placement/static ads and dynamic ads) will grow to $971.3 million.
According to the Advertising and Games: 2007 In-Game Advertising Forecast, new media is eclipsing traditional advertising media.
Spending on traditional advertising media (television, newspapers, radio and magazines) grew $3.6 billion last year while spending on internet advertising grew $4.3 billion.
As a result of the significant shift in advertising expenditures in new media, in-game advertising budgets and networks serving these ads are also growing. In addition, connected game devices are becoming the foundation on which providers build dynamic in-game insertion.
Michael Goodman, director of digital entertainment in Yankee Group’s consumer research group, said: “As ubiquitous connectivity continues to reshape the media and entertainment landscape, media fragmentation and clutter are a result, making traditional advertising channels less effective.
“Advertisers are increasingly finding in-game advertising to be a greater investment value because of the variety of opportunities that exist in and around games. Video games represent an ‘above the line’ opportunity, which means that video games should be used to build brands and not as a call to action that distracts from the game play.”
A recent report from Parks Associates said that game advertising spending in the US will grow from $370 million in 2006 to more than $2 billion in 2012 (see US Game Adspend To Break $2 Billion Barrier By 2012).
Meanwhile, eMarketer forecast that US advertisers will increase spending in video games by 45%, to $502 million this year (see US Video Game Adspend To Increase).
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