Niklas Bakos, CSO at Adverty, argues that the popularity of mobile games and in-game advertising is here to stay.

Huge numbers of us know that mobile games offer a little virtual island to which we can escape in the midst of a commute, a lockdown or a stressful day. Globally, users downloaded more than 1bn billion games per week in Q1 2021, according to App Annie, and the appeal is a mainstream one – more than 50 per cent of mobile gamers are older than 34 [source: Mediakix] and 51 per cent are women [source: MoPub].

But anyone who has disregarded mobile games as just the low-budget, housewife-friendly cousin of the console gaming experience needs to look again. Not only is mobile gaming by far the main driver of growth for digital games consumption, claiming $120bn of consumer spend against home and handheld consoles’ $43 billion [source: App Annie], but advances in mobile graphics and gameplay, combined with the rise of console companion apps, are bringing mobile and console closer together than ever before.

The convergence is visible on numerous fronts. Games such as Lineage M, Lords Mobile and Roblox have been cross-platform hits with major mobile appeal. Meanwhile, publishers such as Electronic Arts, Rockstar owner Take-Two Interactive and Zynga are busily buying up mobile gaming studios. They are hungry for their user bases, conscious that previously locked-down populations may not want to be chained to their consoles and computers anymore, and intent on developing mobile adaptations of popular PC and console games.

For companies that have worked hard to develop the advertising ecosystem of mobile gaming, these are vindicating developments. The broader gaming world is not only intersecting with mobile but attempting to piggy-back on it, hungry for its consumer penetration and flexible user experience. Any kind of game, and any kind of gamer, can now find a home in the mobile gaming world, and the same increasingly applies to any kind of advertiser, too.

The expanding boundaries of in-game advertising
In 2021, while much else was going on, the boundaries of mobile advertising were quietly expanding. Gaming is already the fastest-growing ad medium, but it is also misunderstood. Because it’s programmatically bought and sold, in-game is often assumed to be exclusively a performance buy, but in reality this is a rare medium – a hybrid that allows both brand and performance advertising.

Adverty’s two ad formats lay out the difference between the two sides of in-game mobile advertising. On the one side is In-Play, a branding mechanism that plants ads within games – a virtual incarnation of Out of Home, based on billboards, bus stops, bus-sides and other highly visible branding media that are proven to be highly memorable but don’t disrupt play.

In-Menu, by contrast, is performance advertising that allows players to click into contextually relevant display banner ads on menu screens between gameplay. Again, it doesn’t take consumers out of the game they are in, but the dynamic allows advertisers to deliver brand messages, including direct paths to purchase.

Games such as Lucky Kat’s Magic Finger 3D, which has racked up more than 20m downloads, demonstrate both approaches in action: billboards within the game and interactive ads in the menu, creating a powerful multiplier effect between the two.

A huge market with infinite brand appeal
With both branding and direct response in their arsenal, innumerable brands fit into a gaming market that reaches 2.6bn people, according to an estimate last year from Morgan Stanley. Some, such as Nike, Coca-Cola, Redbull, even Gucci, have famously invested in the sector, but future gaming advertisers will span the range from global to local – from a blue-chip brand seeking reach and awareness to a local takeaway reckoning on the fact that gamers may want to order without stopping.

During the past year, the in-game picture has come into full focus – from the mass-market audience, to the carefully-tailored advertising opportunities, to the convergence of the gaming world around the mobile platform. Inevitably, the next year will see only greater strides in this booming medium. And this time, with a little luck, instead of surging in lockdown, we’ll be surfing on the post-pandemic rebound.