With Microsoft shutting down Massive Inc. last month, many are asking if in-game advertising is on life support.
Well, the industry’s remaining players obviously say no. According to Alex Sood, CEO of in-game ad firm Double Fusion, business has ramped up rapidly after a recession-rocked 2009. Sood, who assumed command at the company early this year, contends that the increased interest among companies to insert their brands into games indicates that Microsoft’s issues with Massive were unique and atypical.
“Massive as an entity was doing quite well, running multiple campaigns” said Sood. “We saw them in the field and we know they were selling ads. There were multiple reasons to make the decision they made, but it was not just ad sales.”
Microsoft execs implied that the gap between Massive and its Xbox group might have been a logistical challenge for brands looking to execute in-game ad campaigns through multiple channels. “In the future, game-oriented advertisers will find it easier to do business with all Microsoft properties with a singular focus, unified sales force and unique advertising opportunities across a suite of gaming properties,” wrote cvp Rik van der Kooi on Microsoft’s ad blog on Oct. 20.
Sood said that Double Fusion has booked 300 percent more campaigns this year following a rocky—though still positive-growth—2009. And while clients were running $15,000 tests a few years ago, he regularly sees spending today on $50,000-100,000 campaigns.
“The market itself is a growing one,” said Sood. “All of the general success metrics are there. Average spending is up, the number of clients is up—and orders per client are up.”
Double Fusion’s smaller in-game ad rival IGA Worldwide also claimed that business was rebounding strongly when it received a new infusion of cash this past summer.
Still, it’s hard to get a handle on just how much growth is happening in the space. It was once predicted to be close to a $2 billion market by now. One of the more recent estimates for in-game ad revenue came last year from Citigroup, which predicted the market could reach $1 billion by 2014.
And early this year Electronic Arts struck a major blow when it elected to pull its in-game ad business in-house. And now games played via Microsoft’s Xbox are seemingly off the market following Massive’s closure.
However, Sony’s PlayStation remains fair game for advertisers (no pun intended). “PlayStation remains committed to the dynamic in-game advertising business, our third-party publishers and our sales and distribution partners,” said David Winding, director, PlayStation network advertising. “As our overall advertising business expands on the platform, in-game advertising looks to play a significant role in that growth.”
Added Winding: “Double Fusion has worked diligently to evangelize and help establish this exciting new market over the course of the last two years and we look forward to continued growth and success in this sector of our business.”
To that end, Double Fusion has lined up a slew of new in-game ad partners from several top publishers, including Sony Computer Entertainment’s Killzone 3, Ubisoft’s Shaun White Skateboarding, Driver: San Francisco, and Ghost Recon: Future Soldier, as well as Eidos’ Deus Ex: Human Revolution and John Daly’s ProStroke Golf. According to Sood, the company’s roster of titles now reaches 50 million unique gamers in a given month worldwide.
“Our network is a fairly deep one,” he said. “The industry is providing a tremendous value to advertisers and is gaining its stride. Our hurdles and struggles are in the past.”
Sood realizes that is a tough argument to make when one of the industry’s top players has just gone under. So he expects a lot of Massive questions from clients. He’s also interested in the opportunity Massive’s exit might offer.
“As an independent ad network, I would love to work with the Xbox platform,” he said. “That would instantly double our reach in the U.S. That’s access we would love to have.”