What Roblox's new ad formats mean for brands

Roblox is rolling out two new ad formats as brands look for ways to get in front of gamers and enter the metaverse. The so-called Immersive Ads, announced today during Roblox’s annual developer conference, will include banner and portal ads. Banner ads will be basic image creatives that can be dynamically served on a billboard or a bus stop, for example. Portal ads will transport users to another Roblox experience. Until now, ads on Roblox were limited to traditional banners and sponsored listings when players search for games. Immersive ads will allow brands to reach their audiences directly in a Roblox experience, the company said. Ads will only appear to players ages 13 or older, and they will not take players out of the experience, meaning they can’t be sent off to a brand website. Roblox also doesn’t allow third-party data or user tracking. This marks the early stages of Roblox evolving into a full-funnel shopping experience. “I would expect that, ultimately, conversion will be brought into the Roblox experience,” said Richard Sim, senior director of product at Roblox. The new formats may be a big step for brands that want a safe place to test out the metaverse and connect with Roblox’s 52 million average daily active users. Brands such as American Eagle, Vans, Tommy Hilfiger and Nike have all set up Roblox worlds to drive awareness. Since Roblox revenue comes from players buying Robux, the platform’s currency, it hasn’t had to rely on ad sales. That has allowed Roblox to be “thoughtful” about how it works with more advertisers, said Sim. See all of Ad Age's 2023 Agency A-List winners here Advertisers will be able to set up banner and portal ads by uploading creative into the Roblox ad system, where they can set budgets and targeting, and set bids to pay for impressions or portal transports. But not every player will be able to see portal ads since they’ll be dynamic depending on age and targeting. “We decided to set user expectations so that they can understand that what they’re seeing doesn't always match their friends,” Sim said in an interview. “We think clearly labeling an ad will let them know it was dynamically served.” Creative will be dynamic by default, but Sim acknowledges that some games may want that cohesion. Brands and developers will be able to turn off dynamic ads and allow targeting at the game server level, meaning that all players who enter the game will see the same ads. Vans and Warner Brothers studios have been some of the first brands to test the new formats. Sim said that Roblox plans to test the ads with developers and a handful of advertisers by the end of this year. Next year, the new ads should be available to all advertisers and developers. Immersive ads will be the third pillar in revenue generation for developers. The first is in-game purchases, such as an avatar outfit, using Robux; the second is premium payouts, which pay developers in Robux based on how much time Premium subscribers spend in their game. “At the end of the day, we know advertisers want to drive value, be it perception, awareness or sales,” said Sim. “Our first step is working with advertisers who want something more engaging than traditional ads.”

What Roblox's new ad formats mean for brands

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