Brands and marketers are finally starting to realize the power of in-game advertising. As the gaming community has expanded in size, so too has the potential for brands to reach gamers directly via their entertainment medium of choice. In accordance with this influx of brand interest, in-game advertising companies have proliferated. Today’s in-game ad firms are building fungible, programmatic in-game ads and immersive experiences that sometimes improve players’ in-game experiences — and sometimes not so much. In spite of this growth, the industry is still rife with common misconceptions about the relationship between gamers and brands. Going into 2022, stakeholders in the in-game advertising industry are looking to raise awareness about the reach and effectiveness of their services and help non-endemic brands ingrain themselves further into the gaming space. The in-game advertising market is projected to grow by nearly $11 billion over the next three years, according to Technavio’s In-Game Advertising Market by Platform and Geography report. Here’s the story of how the modern in-game advertising industry took shape — and how some industry observers predict the space could evolve in the future. 01
The early days
In-game advertising has been around for almost as long as the game industry itself. The original in-game ads were hard-coded directly into games, and were usually the result of developers or their hired agents directly wooing skeptical brands to place their products into the game. Samuel Huber, CEO, Admix, an in-game advertising infrastructure company that serves publishers and advertisers: For a podcast a year ago, we tracked down pioneers in in-game advertising, and I think the oldest I found was in the mid-80s — someone trying to inject brands into a Nintendo game. There was a Pepsi campaign in 1999, I think, where you could collect cans instead of coins. It was just trying to integrate the brands in a native way. So, brands have always tried to reach that audience, but it was very much like, “oh, let’s do a campaign on this game, or a campaign there.’ It was very manual; the game developers had to actively implement all of this stuff, literally designing the cans of Pepsi and putting them in the game. It was more creative work than advertising in any scalable model. James Draper, CEO, Bidstack, an in-game ad provider that connects developers and brands: The first in-game advertising was back in the ’80s. I think the game Zool was the first one where a product, Chupa Chups, was up there in the background of a platform-based game. This guy was almost like a broker — he would go out to advertising agency groups to try and broker deals, then go to game producers one by one and try to bring brands into the storyline. Natalia Vasilyeva, vp of marketing, Anzu, an in-game ad firm that recently partnered with Roblox creators to bring ads into the platform: The beginning of it dates back to the ’80s, when we had the first hard-coded ads in games — Chupa Chups was advertising in games. We saw hard-coded ads and case-by-case activations; obviously, there was no programmatic. 02
Middle ground
In-game advertising is a booming business going into 2022; over the next 12 months, 81% of media buyers plan to scale up in-game spending, according to an Admix report . But things haven’t always been this way. Between the early days of the industry and the modern renaissance, several companies tried to build in-game advertising into a sustainable business, attaining varying levels of success and technological innovation. Vasilyeva: There were some predecessors, and there were some companies that were successful in the early 2000s. One of them was even acquired by Microsoft. So Microsoft took it seriously and tried to leverage the technology to build it. They didn’t succeed, as you can see, for a number of reasons. I would say the major block was still technology — the lack of technology, lack of scale, lack of the right mindsets. We can talk about [early in-game ad firms] Double Fusion or Massive, the one that was acquired by Microsoft. By the way, the CEO of Double Fusion is our strategic advisor — it’s worth trying to learn from mistakes. Draper: From 2003 to 2010, there was a bit of an arms race between three different companies, one of which was called Massive Inc. Between 2003 and 2006, the industry was pretty much themselves, which was good and bad. In terms of trying to standardize an ad format and get the advertising world to buy into it, while at the same time getting the game producers to sign up to this thing, they did a very good job. But then they sold to Microsoft for at least $10 million back in 2006. When they started with the XBox, that opened up the opportunity for Sony. So two companies, Double Fusion and IGA Worldwide, gunned after the Sony part of the marketplace. It all got a bit chaotic. The technology wasn’t ripened enough, from a programmatic standpoint; the supply side wasn’t quite there; and obviously the gaming side and its connections to the internet were just not as it is today. Both sides were a bit immature, basically, and they all died off by 2010. Huber: There were a lot of companies along the way, like Massive, who sold to Microsoft, and then Microsoft killed it. There was another one called IGA; I think they sold as well. RapidFire — they’ve kind of been around, but not [the company hasn’t updated its social media since 2017]. So there’s been a lot of promises every five years or so, but no one’s really built it from a tech point-of-view. 03
Technological developments
As technology began to catch up with gamers’ thirst for consumption, in-game ad firms made a comeback, adapting newer and broader adtech applications such as programmatic advertising to function within game worlds. Huber: Programmatic advertising really was born in 2010. On mobile, it really hit around 2014–2015. And before that, you didn’t really have the ability to scale campaigns, because you’d have to go straight to the publisher, and it was almost a direct relationship. There was no way to build a scalable ad distribution, there was no open real-time betting network — everything was different. Five years ago, I guess that technology kind of existed already, but gaming just wasn’t front of mind for advertisers. It was considered niche, and Fortnite and Roblox were not as big as they are now. Vasilyeva: With the rise of digitalization, and with the rise of programmatic, everybody kind of switched to performance marketing, and we forgot about old and time-proven brand awareness. Now, it’s the first time that brand-awareness advertising is possible in digital worlds, though it’s super, super nascent. There are a lot of gaps that we’re kind of on the way to improving. Fran Petruzzelli, CTO, Bidstack: The evolution became far more complex, bringing more programmatic standards into gaming. There’s a lot of hurdles, a lot of technological evolution. Programmatic advertising, by its very nature, is built for the internet and for mobile; it’s built for the standard formats. It’s not built for a dynamic environment which is fast-moving, or moving in any way, really. It’s very much built for a static web page. And so we’ve had to help fit the standards that you find in the game around the metrics that you see in the standard world — things like adapting technology to work with mobile phone displays and ensuring that the brands are aware of how another could be seen. 04
Increasing brand interest
The growth of in-game advertising has led to an influx of interest from non-endemic brands that kept a wide berth from the space in the past. Matthew Warneford, CEO, Dubit, metaversal game developer: Funnily enough, we’re actually talking to an insurance company right now. You can kind of forget this idea that we’re trying to sell the product — we’re not selling products, what we’re doing is building a connection to that brand. Huber: That’s the shift that happened in the brands’ minds over the past couple of years: thinking of gaming not just as a creative outlet, but as a channel where you have 2 billion people playing every day. If you’re 18 to 34, it’s like 20 to 25 percent of your time online. So that’s a big blind spot for brands to not target them. It’s more about the audience behind it and how they behave — you know, 2 billion players is 2 billion potential consumers. Edward Castillo, managing partner, Admazing, mobile-focused in-game advertising firm: A lot of clients have asked us, from both endemic and non-endemic brands, what our participation is in this type of vertical moving forward. 05
A new type of e-commerce
With gamers becoming accustomed to owning completely virtual objects, in-game advertising is no longer a vehicle to get players to purchase physical goods. These days, virtual commerce is a burgeoning industry in its own right, with in-game ads helping drive the consumption of entirely digital items, such as the virtual garments sold on DRESSX . Warneford: When I was young, a lot of premium brands would bring out perfumes or fragrances, and they were all reasonably affordable price points in comparison to buying Chanel clothing, or whatever it might be. One of the reasons they do this is that it’s about starting that brand affinity early on: I can’t yet afford to buy Calvin Klein clothes, but I can buy the perfume once a year, and I start to build that connection with the brand. I think there’s an element of that through the sale of virtual goods; there are some interesting psychological effects around making a commitment to something and purchasing something. Huber: Gaming is a very rich experience, now that we’re serving ads in the spaces that we create. But we could easily sell products, and that’s something we are testing. You can imagine that, further down the line, we will have formats that are more like experiences, and the ability to sell products that could even be NFTs within the game. 06
Stepping into the metaverse
In the race to build the metaverse, leaders are emerging from the gaming space , and in-game advertising is no exception. Many of the in-game ad companies of today are looking to become the in-metaverse ad firms of tomorrow. Petruzzelli: The reality is, the nature of what we do is that we’re actively involved in that ecosystem from day one. The way players interact, the way skins can be exchanged, and players can interact with the game environment — effectively, that is what the metaverse is. I think in-game advertising is intrinsically linked. Warneford: The interesting thing about the metaverse is that anybody can build inside of these platforms; it’s not constrained to, ‘oh, you’ve given me a bit of ad space over here that I can put a square banner into.’ I can build what I want in Fortnite, Roblox, Rec Room, blah blah blah. Brands follow where people are, so I’m pretty sure brands will follow users into the metaverse. And so the question becomes, how much is a user in the metaverse worth to a brand? https://digiday.com/?p=435960
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‘Brands follow where people are’: An oral history of the evolution of in-game advertising

Unity exec on engine-maker's new broadcast tech and whether gaming can lean on its past like sports teams do
As an executive at Sega, Microsoft, and then Electronic Arts, Peter Moore was unquestionably part of the games industry for the better part of two decades. Then he left for the world of sports and the chance to be CEO of his favorite childhood football team, Liverpool FC. After three years in which Liverpool enjoyed considerable success and a Premier League championship, Moore stepped down and seemingly returned to games with an executive appointment at Unity and a board position for mobile publisher Nifty Games . But speaking with GamesIndustry.biz, Moore doesn't see his position as Unity's senior vice president and general manager of sports and live entertainment as actually being in games. "I'm no longer in the direct gaming industry," Moore says. "I'm taking gaming technology and I'm moving into sports." Despite that, he still frequently refers to gaming as "our industry," which we take not as a contradictory slip-up but evidence of just how intertwined he sees the two fields' futures. That's why he's appearing on the mainstage at Leaders Week London tomorrow, telling the sporting conference audience about how gaming technology will help shape "the future reality of sport." He gives us an example of what he means with a demonstration of Metacast, an offering Unity is pitching as "the real-time 3D sports engine that powers the next evolution of sports participation, production, consumption, and monetization." Moore shows that off with a bit of footage from a UFC fight straight out of the uncanny valley. The match between Georges St-Pierre and Kevin Lee features convincingly lifelike footage of the two fighters that's clearly a cut above the latest UFC video game. But the Octagon they are fighting in exists in a void, and their lifelike representations appear noticeably pasted into the world. Metacast combines 3D game tech with the actual faces UFC fighters make during a match
But then the camera swings around the fighters, pausing to show strikes and holds from a multitude of angles that would be impossible to get in a traditional TV broadcast, including a first-person perspective from one of the fighters. Moore explains that the images of the fighters were created using volumetric capture, with a series of RGB and infrared cameras positioned around the fighters and Unity's tech doing the math to extrapolate all that data into a 3D environment. We've seen sports broadcasts incorporating conspicuous 3D kludges for a while, but the Metacast UFC fight does seem like a step up from what we're used to. Next he takes us through a similar treatment from the Rugby World Cup, pausing the action to display Family Circus-like trajectory lines showing where players were and where they're headed. All the while, Moore is touting the opportunities Metacast offers, like letting viewers highlight their favorite athlete's shoes and purchase them instantly. It reminds us of the push for dynamic in-game advertising from the mid-'00s, when firms like Massive, IGA Worldwide, and Double Fusion promised that serving big brands into games would revolutionize the industry. Microsoft spent hundreds of millions to acquire Massive in 2006, but shut the division down four years later . IGA Worldwide and Double Fusion likewise disappeared from view shortly after. "There's still a lot of money spent on in-game advertising. But sports is a whole different story. It's somewhere between $40 billion and $60 billion a year spent on advertising in sports"
Moore was at Microsoft at the time of the Massive acquisition, so we ask why this kind of interactive advertising should work in sports when it never seemed to live up to its promises in games. "I have two daughters that work at EA on in-game advertising, and there's still a lot of money spent on in-game advertising," Moore notes. "But sports is a whole different story. It's somewhere between $40 billion and $60 billion a year spent on advertising in sports. What we're doing is we're melding and blending the video game world and the real world of sports with this technology, if you will. "As CEO of Liverpool, we were about a half billion dollars in sponsorships and advertising paid to us... It's huge because of the viewing audiences. UFC gets millions of people in real time. And the fact you could tap on [a player in the Metacast demo] is indicative of the fact you could interact with the advertiser and turn that advertising into a sale in real time. You couldn't do that in our video games. You couldn't do that in the old days." Moore expects the tech to be used initially for performance analytics and during sports broadcasts. "At first what you're going to see is half-time or post-game analysis using 3D, but it's just a question of time because the technology is there and the pipes are there with 5G and 6G in the future," Moore says. Peter Moore, Unity
It doesn't stop there, of course. "I'm not a betting guy but I know the FanDuels and DraftKings of this world soak up that data and are able to utilize that for their business models," Moore says. Moore even envisions more noble uses of Metacast, showing a clip of kids practicing basketball in a high school gym and saying coaches could use the tool to give young players more immediate feedback and help them understand the game better. There are limits to the tech in its current form, and they become more apparent as Moore switches from sport to sport. The UFC demo comes off the most impressive, but it's also arguably the simplest, with just two athletes to track from a multitude of angles. As a contact sport with 30 players (and the resulting tangle of limbs) to keep track of at all times, a Rugby World Cup match presents the Metacast with a tougher challenge. "Yeah, occlusion is an issue," Moore admits. "You can see with UFC we've managed with our rendering tools to eliminate occlusion. But like any technology I've been involved in for the last 30-plus years, it will just evolve. Moore's Law kicks in with this stuff very easily. Less cameras in the stadium, better quality 8K and 10K cameras. We're pushing five million voxels a second here." Bringing gaming technology to bear on sports should be familiar to Moore, as he said his time with Liverpool taught him just how much the sporting world could learn from games, particularly about the merits of engaging with a global audience. "Liverpool's a huge club: 400 million fans in every corner and every nook and cranny of this world," Moore says. "How do we engage them 24-7? You're only playing a football match once or twice a week for 90 minutes. But the thirst for content, the thirst for information, the thirst to see training and interviews... "
As for what games could learn from sports, we ask Moore about sports' ability to use its past to drive interest in the present and the future. "When I was at Sega, man, we leveraged Sonic the Hedgehog every different way you possibly could. But gaming moves so fast"
"Liverpool formed in 1892, and most of our marketing we would do was about the history, the legacy, and the nostalgia," Moore says. "Now we're a very successful modern team, but we stand on the shoulders of giants and we embraced our history because our fans craved that legacy and that history. "With games, because of the progression of technology, it's tough to go back. When I was at Sega, man, we leveraged Sonic the Hedgehog every different way you possibly could. But gaming moves so fast." One of the big problems in Moore's eyes is that companies wind up having to use modern technology to constantly reinvent cherished intellectual properties, and the resulting efforts often look completely different from the ones people loved. And while some companies have done it well -- he notes Nintendo as the best -- not every publisher has quite as much history to lean on. "With Xbox, maybe you could back to the original Halo," Moore suggests. "But it's really more about the IP. With Liverpool, I could go back into the archives and show footage from games in the 1930s and people would lap that stuff up. You tapped into that warm feeling. I first went to Amfield in 1959. My dad took me when I was four years of age to watch Liverpool play. And even though I moved to America 40 years ago, my life can be tracked against Liverpool's wins and losses and what have you." Games can do that to some extent, he adds. Last month he posted on Twitter about the Dreamcast's 22nd anniversary and how that resonated with his followers. "I'll go back to SoulCalibur, Sonic Adventures, Ready 2 Rumble, Hydro Thunder, TrickStyle and people would weigh in," Moore says. "My Twitter account would be full of these warm memories. But in relation to sports, it's a really tight timeline. Really it's 30 years, from when we got into the PlayStation era onwards that it became a big business." That timeline will obviously expand on its own as the years roll by, but Moore has some reservations about whether or not gaming can ever truly capitalize on its past the way professional sports has. "I worry a little bit that we get nostalgic for the old games and we go back and play them and go, 'Eh, it wasn't quite like I remembered.' I think we struggle a little bit with games. I've watched companies bundle old games together on mini devices and it seems to work, but I think our industry moves too quickly." Connect with the UK Video Games Industry

Peter Moore on the future of sports and the history of games

Interactive Gaming and Advertising Industry Veteran Justin Townsend Joins GOOD GAMING Board as Non-Executive Director
CHICAGO, IL--(Marketwired - Sep 29, 2014) -  CMG Holdings Inc. (
OTCQB
: CMGO ), Chairman Glenn Laken of GOOD GAMING Inc., the innovative eLearning and social networking platform for eSports gamers, today announced that start-up executive and former Co-Founder, CEO and Chairman of IGA Worldwide, Justin Townsend has joined the GOOD GAMING board as a non-executive director. Recognized as a transformational leader in the digital and video gaming media space, Mr. Townsend is a prolific media technology innovator with decades of marketing and business development experience, and has held senior roles at a variety of global digital and media organizations both in Europe and the U.S. Previous to joining GOOD GAMING, Mr. Townsend founded IGA Worldwide, building it into the global leader in 360-degree in-game advertising solutions. Recognized as a "Breakout Company of the Year" and "Top 100 Private Company" in the media and entertainment sectors, IGA Worldwide enabled advertisers to target millions of highly engaged consumers playing games across a wide range of gaming genres and platforms including PC, console and mobile. IGA Worldwide was selected by Sony Computer Entertainment as the first in-game advertising provider for the PLAYSTATION®3 and partnered globally with the leading game companies worldwide including Electronic Arts, Activision, Valve, Sega, Atari and Codemasters, building a unique audience reach of over 30 Million consumers. "As a core enthusiast gamer myself, I'm excited to join the leadership team and capitalize on GOOD GAMING's opportunity to lead eSports gaming in an exciting new direction," said Justin Townsend. "I truly believe that we are on the cusp of an explosive growth trajectory in eSports participation, and GOOD GAMING adds tremendous value by making those gaming experience better for players. "
Currently in beta testing, GOOD GAMING provides the tools, resources and community networking framework today's eSports gamer needs to go from an aspiring amateur to eSports Champion. As the newest member of the growing GOOD GAMING executive team, Mr. Townsend will strengthen the board and management team by spearheading cross-media innovation and business development relationships with key industry partners. Mr. Townsend will report directly to GOOD GAMING Chairman Glenn Laken. "Justin adds high caliber leadership and depth to GOOD GAMING's growing leadership team," commented Mr. Laken. "His experience in building cross-media platforms and profitable business partnerships in the games sector, combined with his wealth of knowledge in eSports gaming will help GOOD GAMING realize its growth potential. "
About Good Gaming
"Where Amateurs Become Pros! " A subsidiary of CMG Holdings, a multi-media company, GOOD GAMING empowers a new generation of eSports gamers to Game Better. Built by the community, for the community, GOOD GAMING connects gamers with other like-minded enthusiasts, enriching their gaming experience and providing the eLearning resources necessary to go from amateur to eSports Pro. For more information, go to www.good-gaming.com . Contact Information

CMG Holdings Inc. eSports Subsidiary, Good Gaming Strengthens Leadership Team

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VANCOUVER, May 27, 2014 (ADOTAS) – RapidFire , the #1 in-game advertising network, announced today the acquisition of IGA Worldwide’s proprietary technology for delivering real-time advertisements inside of video games. IGA Worldwide’s technology, known as the Radial Network™, enables brands and advertisers to reach gamers playing AAA game titles across console, computer, and mobile video games. Advertisements are streamed in real-time inside of a video game’s 3D environment on objects such as billboards, hoardings, buses, and posters – essentially any object where a gamer is likely to see an advert in real life. As part of the deal, RapidFire will take ownership of the Radial Network™ ad servers and software development kits (SDKs), and will immediately replace the pre-existing RapidFire in-game ad serving technology. From an advertising standpoint, the Radial Network™ has the following specs and capabilities:
Geo-targeting as precise as to the city level. Frequency capping (controlling ad views per unique player). Delivering ads to gamers playing offline as long as an initial Internet connection is made. Detailed web-based and exported campaign reports. Support for both video and animated ad formats for in-game delivery. “We’re ecstatic about the deal and what it means for RapidFire’s growth,” said Jordan L. Howard (pictured), the company’s 23-year-old Founder and CEO. “IGA Worldwide was a pioneer in the in-game advertising industry, and spent many years perfecting their ad serving technology. With the Radial Network™ technology we’ll have a much more robust system, and will be able to provide unparalleled service to both our media buying clients and our game developer partners.”
“I am very happy that with Jordan and the RapidFire team, we have found a great successor who has the passion and capacity to bring in-game ads to the next level,” said Christian-Alexander Vry, Director at IGA Worldwide Ltd.
About RapidFire
RapidFire is the World’s largest in-game advertising company, founded in the fall of 2011 and is headquartered in Vancouver. The company enables advertisers to target millions of highly engaged consumers playing video games across a wide range of gaming platforms and genres. In addition to offering a dynamic in-game advertising network, RapidFire also leverages its relationships with game developers to offer brands the ability to launch product placement and advergaming campaigns. RapidFire is privately held, and is an active member of IAB Canada and IAB UK. For more information about RapidFire, please visit: http://www.rapidfire.com . Subscribe to the free Adotas.com Newsletter
Adotas was not involved in the creation of this content. All information is supplied by the respective companies and/or the communications professionals that represent said companies. Adotas accepts no responsibility for any false claims, statements, opnions or data included therein.

RapidFire Acquires the In-Game Advertising Technology of IGA Worldwide

Tags: IGA Worldwide , in-game ads , Justin Townsend
IGA Worldwide , a once-promising in-game advertising firm, has laid off an unspecified number of employees, VentureBeat has learned. The New York-based company cut about seven of its 22 employees, according to two sources, who requested anonymity. The layoffs suggest that all is not well with the in-game ad business that focuses on PC games and consoles. Justin Townsend, co-founder of IGA Worldwide, said in an email that the “one-third layoffs” was incorrect. But he declined to comment further. [Update: Townsend said that less than a quarter of the employees were laid off and more details will be announced later. This was due to a strategic realignment of the business and a focus on other priorities. ]
Back in 2008 , IGA Worldwide had 70 employees and it was reaching gamers on four platforms: the PC, Mac, Flash games, and the PlayStation 3. But in the meantime, much of the brand advertising has been moving into social games on Facebook and mobile games as well. IGA’s financial backers include GE/NBCU, Intel Capital, Morgenthaler Ventures, Easton Capital, DN Capital, KTB Ventures, Translink Capital, Itochu Technology and Sumitomo/Presidio STX. Altogether, the company has raised nearly $30 million in two rounds. Townsend founded IGA Worldwide in 2004. Back then, in-game ads were hot and Microsoft paid hundreds of millions of dollars to buy the leading in-game ad firm, Massive. Google also entered the market and then pulled out. Microsoft is now inserting ads into the Xbox 360’s dashboard and int some of its games on Xbox Live as well. Get more stories like this:

In-game ad firm IGA Worldwide lays off nearly a third of its employees

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