Can Advertisers Make Money Through Facebook Games?

By Justin Lafferty 

One of the most popular early panels at the AllFacebook Marketing Conference in San Francisco Thursday was “Monetizing Facebook Games Through Advertising,” where an expert panel discussed ways that advertisers can connect with gamers — and not annoy them.

The panel:

  • Projjol Banerjea, director of marketing, SponsorPlay
  • Brian Blond, chief revenue officer, Vitrue
  • Chris Cunningham, CEO, Appsavvy
  • Mitchell Weisman, founder and CEO, LifeStreet Media
  • Jesyca Durchin, CEO and founder, Digital Playspace
  • Alex Dale, chief marketing officer, (moderator)

Panelists agreed that there is a lot of potential with regard to advertising within games. Weisman stated that display advertising can serve as a powerful revenue source and customer acquisition vehicle for app developers. Cunningham urged advertisers to eschew banner advertisements, which have very low click-through rates and are usually ignored, for different types of in-game advertising. Durchin gave the example of one of her company’s games, Dreamhouse Designer, which uses sponsored gifts in the game, such as a certain company’s couch or table. Banerjea urged advertisers to really engage with users through games, but also noted that it’s a unique challenge.

Cunningham explained what advertisers should be doing, instead of just trying to vie for space next to the game:

Rather than putting ads next to what people do, it’s more about concentrating about what people are doing. It’s focusing on the standard of the game, in between game play, after you level up, once you save your avatar. That’s a much more center-of-the-screen, one-to-one conversation with the user, as opposed to littering the Web and Facebook with a bunch of banners that no one cares about.

However, Durchin noted that many advertisers are scared to go beyond the norm of banner ads and click-throughs to Facebook pages.

The panel also tackled the issue of incentivized ads, where users are given some kind of prize for clicking on an ad or signing up for a product.

Weisman noted that while it may be a great way to boost the sheer number of likes, it’s not an honest way to gain a following, since the people are liking the page to get something, not because they really believe in the product that the page is pushing:

Incentivizing ads distorts the result. If you are buying incentivized advertising, you have to realize that’s what you’re buying. Folks are not necessarily responding because they want your product.

One of the other major issues that the panel tackled was mobile ads. As Facebook becomes more and more of a mobile company (Dale noted that more than one-half of Facebook sessions take place on phones and tablets), companies should place higher attention on what kinds of ads they’re sharing through mobile. Panelists felt that the phone should not be treated as just another screen, as it is a connection that people take with them everywhere. With less real estate than a computer screen, the message that gets across on smartphones is crucial.

Cunningham explained that ads on mobile games have natural places to go, such as after a user has leveled up:

They have a perfect marriage and opportunity so long as we think about the timing.

Readers: What do you do when you see ads intertwined throughout a game?

Follow me on Twitter for live updates of the conference, @JLaffertyAF.