Online gaming - untapped market for advertisers?
Posted by: Marketing Guy Date posted: October 19th, 2006 Published in: Advertising, Marketing, Online Gaming, Traffic GenerationI think my generation has a very unique perspective on gaming. I’m 27 - I grew up with Nintendo, Sega, Commodore, Amiga, etc and it doesn’t really need to be stated, but each generation of video gaming brings with it new markets and a hell of a lot more money spent by consumers each year.
We’re all familiar with product placement in movies and to a (smaller) extent it has been tried in gaming - racing games with advertiser billboards, shoot em ups with Coke cans littered around desolate environments - even direct commercial tie ins (Bob the Builder!).
However it is only in recent years that online gaming has reached “mass market popularity”, cutting into mainstream gaming, largely led by the PC community, but now being explored more and more by console gamers (who traditionally have been more “mass market” than their tech-savvy PC counterparts).
I think it is about time that the online marketing community looked at online gaming as a more serious option for traffic and business generation.
MMORPGs
Massive Multiplayer Online Role Playing Games such as EverQuest and World of Warcraft have huge online communities, which are largely ignored by the online marketing community (which tends to obsess more with “generic” sources of traffic such as Google). Why? It seems to me that forums, blogs, etc with tens of thousands of Internet savvy users that will flood other areas on the web on a scale on par with Digg or Slashdot, would be an ideal target some certain types of marketing campaigns.
However these types of communities tend not to be quite as “vanilla” as your average blog or forum user base. This is a group of people who are effectively leading a second life with their virtual comrades - most won’t take too kindly to link spam and the like!
One community I know about suffered a near catastrophic exodus when the forum admin added an advertising banner to the forums to cover some of his costs. It wasn’t an objection at advertising in general though - it was the type of advertising - a banner for a company that exchanged in game currency for dollars.
And this brings us to one of the central developments in online gaming over the past few years - the exchange of items and currency for “real life” money. While this is a legitimate business move by the people running the operation (who, by the way, are old school SEOs!), the communities being targeted object a great deal to this practice. We’ve all seen threads on forums go nuclear when the resident troll or guest spammer decides to piss people off. That’s nothing compared to the fall out from a flame session in the gaming community!
So, why would an online marketing professional want to expose their brand to this volatile environment?
Viral marketing!
Consider the structure of an average MMO community.
Each player chooses a “class” to play (eg warrior, wizard, druid, etc).
Each player is based on a “server” (a unique version of the online world - larger games may have dozens of different servers which contain thousands of players).
Within this server, most players are part of a guild or clan.
Each class, server and guild has their own forums. Rough examples of figures - assume 500,000 players in total - 20 servers (20 forums), 10 classes (10 forums), potentially 200 (active) guilds per server (4000 forums) and a handful of random “fan sites” (say another 50). Several thousand forums each with a variety of members ranging from dozens to tens of thousands.
Example - check out Google Video for “World of Warcraft” - 6,148 results, with the most popular ones having thousands of page views. YouTube for the same search - 9,567 results, with the top results having quarter of a million views.
Even mainstream media covers issues raised in online gaming, everything ranging from the state of the economy to in game events:
- BBC - Gay rights win in World of Warcraft
- BBC - Deadly plague hits Warcraft
- BBC - US Congress steps into Cyberspace
The last news item there is one of the most interesting developments of late. The US Congress is exploring online game worlds, supposedly simply to monitor the exponential growth of in game economies, and not with a view to implement tax on transactions (between in game and real life currencies).
Second Life
This latest US Congress has been spurred not by mainstream online gaming (where in game to real life transactions are minimal), but more by a recently launched game called “Second Life“. While WoW and EQ are fantasy based games where users can take on the roll of a Paladin or a Wizard to battle enemies, Second Life mirrors real life more - people create their own appearances and buy land, etc.
The difference here is that all users buy currency using their real life credit cards (and indeed, they can make money in game and withdraw it). Think of it as a virtual MySpace / Ebay - rather than a website, you can walk around a virtual world.
The interesting point here is that SL has attracted some very high profile mainstream interest - the BBC “own” an island within the game and use it to host virtual concerts via BBC Radio 1. Reuters even have a full time reporter in the virtual world, and offer a live exchange rate analysis detailing online spend on a daily basis.
Its not surprising that the amount of effort put into the economies of these online worlds has the economic impact equivalent to the GDP of Nambia - Second Life alone has a daily user spend of over $400,000 (US)!
To the cynics
I know at this point a lot of people are thinking…what the fuck? Clearly you aren’t familiar with online gaming (or you would have said “WTF?”! ;)) - hell, 10 years ago if someone told me that you could eventually use that dusty old computer to make a fortune on something called “the Internet” I would have laughed. Or maybe 5 years ago that Google would account for 25% of ALL online advertising spend? (hat tip to TW)
Even those who pioneered using eBay / Amazon / MySpace to create a business income from were probably regarded with bemusement in the early days.
Unlike eBay, YouTube, Amazon or MySpace, Second Life and other online games don’t deal with user retention issues in the same way - they aren’t bookmarked and don’t rely on glossy, clever marketing campaigns to boost market share. Users join these online communities and they become a part of life unlike any other concept in our history.
Although demographics of users may vary - ranging from teenagers to pensioners - one key fact remains constant - users are comfortable conducting business online and given the scale of each user base of each online game, is that something the online marketing community can ignore?
Just installed Second Life last night - to be honest (and this comes from someone who has been an online gamer for years) - I found it more complicated to get into than when I started out in SEO! :) But gonna have a mess around and see what I can do with it - may post some more info back later on.
MG











