EA took its in-game ad business in-house a few years ago—a move that essentially proved the death knell for Massive, which lived and died on many of EA’s major sports games. Soon after, top gaming ad sales exec Elizabeth Hartz left the company. Then last year, Dave Madden, veteran of online gaming firm WildTangent, came aboard as svp, global media solutions to reboot EA’s ad sales efforts.
“We’re looking to move from being a packaged-goods company to a media company,” says Madden.
Media companies—at least those that own TV networks—host annual upfront presentations to unveil their latest products and negotiate deals with ad clients, and EA’s turnout at E3 felt a lot like an upfront. This even though advertising wasn’t mentioned once during the company’s press conference—which, naturally, was all about the games. Leading one to wonder: Just how serious is this company about the ad game?
“The business is less about selling in-game ads—it’s more about engagement,” says COO Peter Moore. In fact, he calls in-game ads as we have known them “dead,” adding that static ads—gaming’s version of product placement—are also limited.
Where is the business at this moment? While EA continues to place ads into games like Madden and Fifa13, it is most bullish about the latest version of The Sims. Because it is meant to simulate real life, the title is ripe for brand integration. Last year, Sims avatars were literally powered by Dunkin’ Donuts coffee, in a nod to the brand’s tagline “America Runs on Dunkin’.” Says Moore: “That’s engagement—that’s not a sign on the road [in the game]. Gamers need to be rewarded for their time, for doing something.”
Programs such as Dunkin’s aren’t easy to execute and can take months to build. But the company is looking to develop technology that makes in-game ad integrations more scalable and automated, says Moore.
During its earnings call, EA doesn’t say exactly how big a business advertising is. When asked whether it is a material business, Moore hedges. “I think it will be,” he says.
“According to the Internet, in-game advertising is the devil,” Brian McClary, digital marketing manager at Ford, says at the E3 show. A self-described gaming geek, McClary sips a lemonade at the Ford Rally Club, a sort of bar (though one free of spirits) built within the L.A. Convention Center. It is McClary’s fourth trip to E3, Ford’s second.
A decade ago, automakers like Ford were among the first marketers to get into advergaming and in-game advertising. More recently, Ford was baked into the latest version of EA’s Need for Speed. According to Mark Bentley, Ford licensing manager, 90 percent of Ford's marketing efforts toward games are focused on licenscing.
Thus, says McClary, “I’m not here to see the next in-game opportunity. We still do dynamic ads—they’re not dead. But if you’re playing a first-person shooter, you don’t want to see ads. Now, we can get around games and incorporate into gaming culture.” For example, Ford had a heavy presence in Sony’s Play-Station Home, its fledgling virtual world.
Indeed, among many advertisers, getting a brand “around games” has eclipsed in-game advertising, making it tough for companies like EA to get marketers to commit to long-term integration deals. After all, there are gaming tournaments to underwrite, events to sponsor. McClary says Ford’s presence at E3 isn’t just about reaching the crowd of some 50,000 gamers but also about getting visibility among millions of gamers reading about and streaming footage of the show.