Why brands like Netflix, Peloton and Zoom are bringing games to their platforms

Major brands are taking a page out of the marketing playbooks of social media platforms by adding games to their offerings. This week, Netflix, Peloton and Zoom all announced unique game offerings as a direct part of their subscriptions or free services. Peloton announced on Monday that it will introduce rhythm-based game Lanebreak, offering Peloton members a way to compete against each other for the highest cycling score. The next day, Netflix confirmed that it will start to roll out ad-free games for mobile devices on its existing service with no added cost to subscribers. It also said it will pursue console games for Xbox and Playstation and has hired former Electronic Arts and Facebook executive Mike Verdu to lead the effort. Then, on Wednesday, Zoom said goodbye to “Zoom fatigue” by announcing it will add games including Ellen DeGeneres’ “Heads Up!” and the question-and-answer game, “Ask Away,” among the 50 apps users can launch within a chat. For these digital-focused companies—all of which saw a spike in subscribers during the pandemic as people isolated in their homes—bringing games to their fanbases will strengthen offerings as in-person events return and pandemic regulations lessen.More from Ad Age: What brands should know about TikTok music and trends With people spending more time on the platforms and the games allowing companies to become more embedded in their users’ daily habits, there will be fewer subscription cancellations, says Ross Benes, senior analyst at marketing research firm Emarketer. “Gaming can help satisfy existing customers, reduce turnover, and expand upon the primary features that make these products stand out,” Benes says. Netflix—facing tough competition from Fortnite and YouTube, where people playing video games get millions of views—hopes the addition of games without ads or in-game purchases will offset the slow growth it's now seeing as people stop watching as much TV. In its second-quarter earnings on Tuesday, the service said it added 5.5 million customers, the slowest growth period the company has seen since the first half of 2013—when it was in fewer than half as many countries. “The reason we're doing [video games] is to help the subscription service grow and be more important in people's lives,” said Reed Hastings during the company’s earnings call. Zoom and Peloton are also down double digits from stock market highs they saw during the peak of the pandemic and have been pigeon-holed as “COVID stocks” by investors who fear business declines as the pandemic subsides. However, both Zoom and Peloton’s first-quarter earnings beat analysts' expectations. Peloton's push into gaming also accompanies its Olympics campaign that is running during the opening ceremony of the games. Netflix, Zoom and Peloton are unique among brands expanding their services to reach gamers. Rather than building out current products to include games, companies including Amazon, Google and Apple have introduced gaming-focused offerings as standalone products, such as Amazon’s cloud gaming service Luna, Google’s Stadia game-streaming service or Apple’s Arcade. More from Ad Age: Out of home ad costs are back to pre-pandemic levels With gaming continuing to see an upward trajectory in consumer growth and demand even as the pandemic wanes, it also makes sense for brands to lean into the consumer trend—especially those that are digital-focused and already have a mission to entertain. “Entertainment and tech brands are adding gaming because it is adjacent to their video products, which makes gaming a somewhat natural extension of what they already do,” says Benes. Of the world population of gamers, mobile phone gamers represent the largest segment—159 million, or 47.5%, and are projected to grow to 167.6 million, or 48.7%, by 2025, according to a February 2021 outlook from Emarketer. There are 97.5 million digital console gamers, or 29% of the population, whose numbers are estimated to drop slightly to 95 million, or 27.6% of the population, by 2025. Not surprisingly, viewers of gaming video content are also on the rise. In 2021, there were 55.2 million viewers of gaming content, or 17% of the world gaming viewing population. By 2025, that number is expected to rise to 62.7 million viewers, or 18%, according to Emarketer. Adding games could also boost marketing potential with other brands, especially with product placement. If games become popular enough, ads could also be inserted within the game, Benes says. “Netflix is unlikely to do this since they have been loathe to run ads, but it is a possibility down the line that these basic games become an ad revenue source as they have with mobile gaming,” he says. Users have seen this strategy before, with social media platforms including Facebook and Snapchat offering games to users for years. In fact, Zoom is working with gaming company Playco, which usually works with social media platforms, to bring games to users. Social media platforms continue to expand their gaming offerings. Facebook, for instance, recently expanded its cloud-streaming platform to all of the U.S., Mexico and Canada at the beginning of July. Subscribe to Ad Age now for the latest industry news and analysis.

Why brands like Netflix, Peloton and Zoom are bringing games to their platforms

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