It doesn't take much to get 26-year-old Janet Ha fighting. Usually, it's a dare received via an Instant Message or the nightly gathering of friends online that gets her into battle mode. Several evenings each week, the Web programmer from New York City fires up Counter-Strike, a multi-player computer game that simulates a war against terrorists. She connects to a server that hosts friends playing the same game and launches into cyber strife, often into the wee hours of the night. Ha admits to spending about 20 hours a week playing the game, improving her gamesmanship and marksmanship with each successive hour. She's so good, in fact, that she says opponents don't realize she's female. Nor does she advertise that detail. The one time she logged on with a female name, her opponents didn't believe it, saying she played too well to be a woman. Yet the differences between Ha and her male counterparts are not lost on her. “Guys just want to crush each other,?? she says. “I like to cooperate.??
Computer gaming isn't what it used to be. Not long ago, the typical players were scruffy teenage boys shooting at TV screens in their basements. But with the online gaming explosion of recent years, gamers have become a more sophisticated lot, and are now more representative of the general population. More women are participating, and older people as well, many of them professionals. According to Nielsen//NetRatings, 41 percent of people who frequent online game sites like GameSpot, Candystand and Pogo are women, and 43 percent are ages 25 to 49. Meanwhile, Reston, Va.-based com-ScoreNetworks, a firm that measures online game use, confirms players are beginning to resemble the general population. On average, 8.9 percent of players at the Top 10 gaming sites are African American, 4.2 percent are Asian and 79.3 percent are white. More significantly, about 35 percent of players on those sites earn $50,000 to $100,000 annually, while 16.2 percent take home more than $100,000.
These demographics spell opportunity for game makers, console manufacturers and game sites hoping to sell units and attract eyeballs. The Interactive Digital Software Association (IDSA), a gaming industry group based in Washington, D.C., estimates that more than 219 million computer and video games were sold in 2000, almost two games for every household in America. And Port Washington, N.Y.-based market research firm NPD Group says retail sales of video games, including hardware, software and accessories, reached a record $9.4 billion in 2001, up 42 percent from the previous year's sales of $6.6 billion. In turn, Cambridge, Mass.-based Forrester Research predicts that the U.S. video games market will grow to $29 billion by 2005.
Such statistics haven't been lost on marketers, either. As gaming goes mass market, the biggest opportunity may lie in advergaming ?" the interactive advertisements that merge online games with product placement ?" through which businesses can target specific demographics. Sponsors of advergaming sites like Nabisco's Candystand are betting they can build brand loyalty among players, and eventually reap the rewards when gamers become online buyers. “Experience is an enormous predictor of what people do online,?? says Harrison Rainie, director of the Pew Internet and American Life Project. “Newcomers do all the fun stuff like e-mail games and Instant Messaging, but eventually, in two or three years, they make a purchase.?? The potential of advergaming to drive sales has kept the marketing dollars flowing from the likes of auto giants Ford and General Motors, among the first companies to successfully incorporate such tactics into their branding campaigns. New York City-based Jupiter Media Metrix estimates that online advergaming revenue, including both traditional advertising and advertising within games (such as a Coke billboard displayed within a racing game), will reach $774 million by 2006, up from $134 million in 2002.
Yet these games are far from a proven marketing strategy. While it's possible to track the growing number of consumers who play them (as well as how often and how long they play), some industry watchers say it's hard to know what actual impact the games have on consumers' brand loyalty ?" or their likelihood of purchasing a product promoted through an advergame. However, despite their early stage of development, advergames are already emerging as one of the Internet's most promising ad strategies ?" and they show little sign of slowing down.
Players have a choice of two main categories of games these days ?" stored and online. Stored games come packaged for play on consoles such as Sony's PlayStation, Microsoft's Xbox and Sega's Genesis, and must be purchased at a store. These typically offer “fast-twitch?? games with high-speed action and cutting-edge graphics to keep the adrenaline pumping, and tend to appeal to an audience of young, die-hard males. Most of these games can be linked over the Internet using modems or network connections, allowing gamers to play together and share information on their moves while leaving all the number crunching to the console. Even the U.S. Army has begun using such games to help train its troops. The online, or Internet-based games, on the other hand, require no special equipment but tend to be far slower. These “slow-twitch?? games must allow for lag times because graphics and other details are being sent over the Internet, and the speed of modem connections varies. Included in this category are board, card and adventure games designed to be played simultaneously.
Most of the growth in gaming is occurring in online games. Framingham, Mass.-based International Data Corporation expects that by 2005, the online gaming audience will rise to 80 million, from 58 million today. Sony Online Entertainment's gaming Web site, The Station (www.station.com), has more than 12 million registered users, while Microsoft's Gaming Zone (www.zone.com) has a membership of 29 million. And many of those players are spending more time than ever at the sites: According to YaYa, a Los Angeles-based advergaming firm, players spend an average of 5 to 7 minutes on an advergame site, a clear advantage for advertisers over a 30-second TV spot. Ha, for one, says that the 20 hours a week she spends playing games has come at the cost of her TV viewing time. “Online gaming is becoming pretty mass market,?? says Chris Di Cesare, group product manager for Microsoft's Gaming Zone. “Not only is it a broader demographic than console gaming, it's flexible and customizable so that you can target quite easily.??
One of those targets is older women, who have accounted for a healthy portion of the growth in gaming. Microsoft's Zone.com considers its core users to be 25 to 34 years old, depending on the game. However, card and board games skew slightly older. But even older demographic groups are showing up in record numbers. “There are many games that appeal to women between 34 and 59, who are a prime demographic,?? says Jane Chen, director of strategy at YaYa. “They're one of the key markets that are considered hard to reach.?? Chen says, for example, that she is currently developing a game for the Chrysler brand of car that's specifically targeted at middle-aged women.
Whereas manufacturers like Nintendo once sought to attract female players by offering game consoles in pink, attracting girls and women today means speaking to their needs and social habits. A key driver, say researchers and analysts, is women's quest for community, compared with men's drive to compete. “The opportunities lie in really playing with communications tools that women regularly use, like Instant Messaging and e-mail,?? says Laura Groppe, president of Venice, Calif.-based Girls Intelligence Agency, a marketing and research firm focused on young women. “At the end of the day, women want to connect with each other.??
For that reason, analysts agree, women tend to gravitate toward card, board and role-playing games that encourage participants to communicate and meet, while men tend to focus on “adrenaline?? games that involve some violence. And because women often indulge while at the office, they tend to prefer quick, simple games that can be played in minutes, instead of long, complex ones that can take days. Ha, for her part, notes that even when playing adrenaline games, she enjoys the conversation with other players and usually stays on chatting even if she loses her turn. In general, Groppe says, women tend to eschew violence in favor of other elements. “It's not that women don't like violent games, it's that they don't get it. To kill things just to get to the next level is pointless,?? says Groppe. “The story and the environment are far more compelling.??
Yet women have also begun to change their habits as they've grown more familiar with gaming, Groppe admits. Ha, for example, began participating in role-playing games six years ago and avoided more violent ones. But now, she says, she is more comfortable with adrenaline games like Counter-Strike, though she also likes to play quick games when she simply wants a break. “As the technology gets more amazing and more women begin to play, their interests will shift,?? says Groppe. “In the beginning, women didn't like adrenaline games. Now you find a lot more of them playing in that category.??
Demographics make advergaming a promising marketing tool. Banner ads failed, sponsorships have shown poor returns, but advergaming immerses targeted audiences in a company's brand for comparatively limited expense. Kent Mar, founder and CEO of San Francisco-based advergame developer Virtual Giveaway, for example, targets gamers based on four variables. First, the content of the game itself is tailored to suit the desired customer. Games of strategy can be directed to upscale, educated users, while action games can be geared to younger users. A second way to tailor the advergame is by the location through which the game is promoted ?" via, say, e-mail marketing campaigns or on Web sites. For instance, ESPN has 78 percent male users for its games, with 60 percent under age 34; Lycos Gamesville users are 60 percent female, and 65 percent are over age 35. The third method of tailoring content is the contest structure of the game ?" how users win. When Virtual Giveaway created an advergame for Sega Dreamcast, for example, it had a specific target: males under age 25, who are highly competitive and action-oriented. So the company created a game in which players would master the game and enter into a series of tiebreakers after a certain number of plays. Core users spent upward of 60 hours a week playing. A fourth type of targeting is based on geography, where demographic information is used to point gamers to such promotions as local retailers or dealers.
No matter how it is tailored, the key to successful advergaming
is setting clear goals. “We find targeted games with
strategic objectives laid out upfront are the most effective
method,?? says YaYa's Chen. Chen, who with former colleague
Matthew Ringel first coined the term “advergaming??
while at New York City-based interactive firm
Marketers can gather data through sweepstakes entries, from opt-in programs soliciting more details or by culling demographics from users who wish to post high scores. While there are restrictions on the kind of particulars that can be obtained from kids, adults can provide a wealth of information ?" from e-mail addresses and basic demographics like age, gender, address and income to favorite car color preferences.
Justin Galvin, director of business development for
What's more, the effects are measurable in other ways. Companies can track how many times a game is downloaded and played. Virtual Giveaway says the average gamer spends 5 to 7 minutes on an advergame site, approximately 14 times the amount of time spent watching a television commercial. Moreover, during that period, the user is clearly an active receiver of marketing messages, whereas a television viewer may leave the room during a commercial break. Companies can also survey users to determine brand recall and positive brand impressions. In 1999, Toyota launched Tundra Madness, a digital racing game. After attracting 8,000 consumers who spent an average of 28 minutes on the site daily over six months, the company's research showed that the campaign raised brand awareness by 28 percent and intent to purchase by 5 percent. The automaker has since launched additional advergames, for a wide range of targets. Last fall, for its new Matrix model, the company targeted first-time car buyers, with the Matrix Video Mixer game, promoted through sites like RollingStone.com, GetMusic.com and Launch.com. The effort was tied to a Gravity Games sponsorship and an in-theater commercial campaign. About 3 in 10 registered users forwarded videos created through the game to their friends; 65 percent of those e-mails were opened.
Several other success stories speak to advergaming's potential. Consumer products giant Procter & Gamble's 2001 Mission Refresh campaign for Head & Shoulders shampoo, targeted at U.S. Hispanic youth, opened up a whole new market, says Anastasia Kitsul, interactive marketing manager for P&G's multicultural business development group. She says the company chose advergaming for its relevance ?" Hispanic teens spend a lot of time online, and one of their favorite activities is gaming. To reach this market, P&G positioned the advergame on gaming sites within Hispanic portals, such as Terra.com and YupiMSN.com. More than 4,000 users forwarded the game to friends, and 70 percent of users told P&G they enjoyed the experience. The company considers the results successful enough to plan advergaming campaigns for a number of brands, including CoverGirl cosmetics and other youth-oriented products.
Even moms are considered a viable advergaming target. Purina developed a game in conjunction with Microsoft's Zone.com to reach young mothers. The campaign involved sponsorship of Outsmart, an online game show that matches celebrities with online users in a trivia contest. Purina's pick? Former TV mom Florence Henderson, who competed with gamers to test their knowledge of The Brady Bunch. In the first 10 days, users played the game half a million times.
Automakers Are Game
Of course, some industries lend themselves more readily to advergaming than others. Automotive companies were among the first to take advantage of these games, and remain one of their most significant patrons. In addition to Ford, General Motors, Toyota, Honda and classified Web site AutoTrader.com have used advergaming as part of their marketing strategies. After Dodge Speedway launched in February 2001, traffic to the Dodge Garage Web site shot up 477 percent, with 284,000 unique visitors playing the game during its first week. In total, more than 1 million unique visitors logged on in its the first year. Pete Hollinshead, CRM Web and direct marketing specialist for Auburn Hills, Mich.-based DaimlerChrysler, says the program has generated leads for local dealers through opt-in information programs. He attributes much of the game's popularity to its placement. “Residing on the MSN Zone gaming site attracted people who might never have come to Dodge,?? Hollinshead says.
General Motors launched its GM eMotion Challenge last year in order to promote awareness of its Powertrain control system among educated males, ages 18 to 35, but found it also attracted a large number of females. Although GM anticipated a ratio of 80 percent male users to 20 percent female, Bill Lussier, brand manager for Powertrain at the Detroit-based firm, says, “We were surprised at the demographics we've seen ?" about 45 percent female.?? Meanwhile, AutoTrader.com took a broader promotional approach, linking its advergame to its own site as well as to AOL, CompuServe, Ask Jeeves and CNNSi. The company also created print ads in its offline magazine and launched an e-mail marketing campaign to target youths, ages 18 to 24. The campaign brought in a significant number of its 550,000 unique visitors within the target market, with 49 percent ages of 18 and 34, and 65 percent women. John Kovac, AutoTrader.com's director of advertising, is planning to launch a new advergame this summer.
Additionally, in an effort to combine online and offline marketing, the Ford Motor Company linked its advergame strategy to an offline component. It created a racing game tied to the creative of its general advertising campaign of racing on the moon. According to YaYa, Ford received a 40 percent click-through rate on its initial e-mail campaign, with users sending the e-mail to an average of three friends. In the process, Ford captured individual consumer data as well as information on car color preference.
What more could advergaming capture? The marketing technique has become so popular that it has been adopted by a broad range of industries, from packaged goods to beverages, from law firms to nonprofits. In December 2001, YaYa developed a campaign for the Siemens Corporation to promote its transportation services, targeted to mayors, government contractors and CEOs. Even the U.S. Mint now offers games on its site, both for educational value in the form of “edutainment?? and to encourage teens' interest in numismatics. The site attracts more than 1 million visitors a month, and since the launch of its games in 1999, the Mint has signed almost half a million subscribers to its newsletters and sold more than $156 million in products from its online catalog. After seeing a number of environmental groups use advergaming techniques to promote their goals, Steve Bosak, director of motorized use programs for nonprofit advocacy group the National Parks Conservation Association, decided to launch an advergame in March 2002. “Our demographics tend to be 50 and older,?? Bosak says. “I want to reach younger people and draw attention to snowmobile regulations that would affect Yellowstone.??
For all that promise, however, games are still far from a proven marketing strategy. While it's possible to track the growing number of consumers who play them, some industry watchers say it's hard to know what actual impact the games have on consumers' brand loyalty ?" or their likelihood to encourage a purchase.
There's also a thin line between innovation and gimmick. Jim Nail, senior analyst at Forrester Research, calls advergaming a nascent market that is “by no means a proven type of advertising, yet.?? In the first place, he says, there's still a big gap in knowledge. “Consumers play these games and it's easy to track how often and long they play,?? says Nail. “But I haven't seen much research about how that changes the way they feel about the brand and their intent to purchase.?? Adds Rudy Grahn, an analyst at Jupiter Media Metrix, “Talking about advergaming as an inherently effective way of driving traffic or transactions overstates its value. It's a promotion in many ways, and promotions attract people who are drawn to the promotion, not the brand.??
Even advergaming fans acknowledge its limitations. The technology isn't nearly as sophisticated as video games, because most developers outfit advergames to accommodate slow modems. “As broadband adoption increases, we'll have the ability to improve advergaming tremendously and offer really meaningful, quality entertainment,?? says Scott McDaniel, vice president of marketing for Sony Online.
Ultimately, the question is whether advergaming will speak as loudly to gamers like Janet Ha. “I don't spend much time watching TV anymore because of all the time spent playing games and doing other things on the computer,?? she admits. She plans to pick up a new game, WarCraft III, soon. “I just need to get started [playing], and once I do I can't stop.??
At the Top of Their Game
More than 15 million unique users visited gaming sites in January.
TOP 10 ONLINE GAMES SITES IN THE U.S., HOME AND WORK
|Site||Unique audience (000)||Acitve reach||Time per person|
|Pogo.com||6,564||5.6%||3 hours 49 minutes|
|Zone.msn.com||5,373||4.6%||1 hour 40 minutes|
|Uproar.com||1,448||1.2%||1 hour 24 minutes|
|All online games||15,448||13.2%||26 minutes|
|*Home and work audience duplication projections did not meet minimum standards for size. As a result, combined home and work audience estimates for these sites may exhibit increased variability month-to-month.|
|Note: list does not include traffic to unique sites of the Yahoo.com domain.|
|Source: Nielsen//NetRatings, January 2002|
In on the Game
PC advertising is expected to grow to $774 million in 2006 from $134 million this year.
U.S. ONLINE GAMES REVENUE PROJECTIONS, 2000-2006 (IN MILLIONS)
|Source: Jupiter Media Metrix, November 2001|
Young adults are heavily equipped.
YOUTH-MARKET DEVICE OWNERSHIP, AMONG ONLINE CONSUMERS AGES 18-24
|Which of the following devices do you currently own?|
|Mobile phone (no Internet)||41%|
|Nintendo Game Boy||23%|
|Mobile phone (with Internet)||20%|
|None of the above||9%|
|Source: Jupiter/NPD Consumer Survey, n=396 online consumers, ages 18-24 only.|
The number of homes with video game consoles is expected to rise 34 percent in two years.
INSTALLED BASE OF MAJOR GAMING CONSOLES IN U.S. HOMES (IN MILLIONS)
|Gaming console type||1998||1999||2000||2001||2002||2003||2004|
|Sony PlayStation 2||-||-||1.0||6.2||13.8||21.9||30.3|
|Source: International Development Group|