Measured Steps

Games: the final frontier. Marketers are constantly seeking innovative media in which to advertise, and videogames are the newest place to be. Gamers provide a highly desirable demographic, males 18-34, who spend a significant amount of time playing or interacting with a vehicle which they don’t fast forward. There are no bathroom breaks (you can pause when nature calls).

“Bluechip advertisers have discovered games,” declares Nicholas Longano, CMO at Massive, one of the pioneers steering advertisers to games. He cites brands working with his company—Coca-Cola, Nestlé, Verizon, Johnson & Johnson, Intel and Dunkin Donuts—as evidence of the sea change.

And Massive isn’t the only company who’s keen to capitalize on this seemingly golden opportunity. IGN Entertainment, BiDamic and DoubleFusion are also planning to work with publishers to deliver advertising in games.

But videogame advertising is a nascent field and still an unproven model. Advertisers are spending cautiously and requesting data to reassure that their dollars are working for them. They want to know how many impressions are being delivered and how long a gamer spends with the ad or product. Enter Nielsen, the measurement experts who track what consumers do with their TV time. Nielsen (which is owned, as is Adweek Magazines, by VNU USA) is working with various publishers and ad networks. Brandweek senior reporter Diane Anderson, who covers technology, spoke with Michael Dowling, general manager at Nielsen Entertainment, to find out how the company will measure ads in this burgeoning field.

Adweek Magazines: What is Nielsen doing in this new world of advertising in videogames?

Michael Dowling: We launched this unit two years ago to identify opportunities for videogame publishers. It was clear publishers wanted research on consumers. We’ve been able to develop a niche, as strategic partners to publishers. One big challenge is pricing comes down as people wait for the next generation. Publishers need incremental revenue.

We got together with [gaming company] Activision to figure out how to create a metric solution. Over the past two years, we’ve had a program of research to inform them and the marketplace.

Last year, we released provocative research on game-play behavior versus TV viewing among 18-34 year-old males. In households with videogame consoles, there is less TV viewing. So the audience is there, spending time playing videogames. Gamers have positive perceptions of ads, provided they are handled properly. They prefer real products, as long as they’re relevant. We tested 500 people in Las Vegas to see if there was lift [with Butterfinger, Nokia and Sobe]. Activision demonstrated to the industry at large that it works [players become more brand-aware from seeing the ad in a game]; we quantify how much people are playing. Now we need to provide agencies with ongoing metric. This won’t be the same as our TV rating, but we’ll ask people to record gameplay behavior.

What are you measuring?

We provide currency with better information and ongoing measure about who is playing, how often, difference among different games. Passaround rates [how many times the games gets lent out or borrowed] confuse advertisers. We say “an unmeasured medium is inherently undervalued.” You need third-party objective data. Right now we are measuring demographics, but we’ll ask perceptions about in-game advertising, too. There’s a definite shift away from TV in terms of spending. Advertisers realize they have to be smart in a TiVo, video-on-demand, game- centric environment.

What kinds of games and advertisers are best suited for this? Racing games seem like a no-brainer because of the cars and billboards…

Absolutely. You could have a McDonalds storefront. Or a character could need to call another character, so [an obvious choice is] LG, Samsung or Nokia.

Automobile advertisers are a natural. We’re asking a number of households to play a special build of Tony Hawk Underground for a month. As Chrysler ads are shown, we get signals, this ad was displayed, person picked up Coke can, passed Jeep billboards, got off skateboard and drove a Jeep for a while.

One challenge is that an advertiser could be placed in games where it doesn’t make sense for them to be. If an advertiser buys across genres of 50 games, it might not feel right to the gamer. This is an engaged consumer with lots of chatting and message boards. There aren’t enough products in games now, but there will be.

What are the missed opportunities?

Females and Hispanics. Publishers should look at programming for those groups and figure out how to drive growth. It’s a huge group they are missing out on.