The gaming industry is on track to maintain its rapid growth and could be worth $321 billion by 2026. And advertisers are paying closer attention when it comes to reaching this lucrative and often elusive market.
A major factor for this growth is that gaming has reached a user generated content (UGC) inflection point that benefits the entire ecosystem. Gamers get more content, in-game creators can earn a living with their creations and advertisers have a new opportunity to create authentic and loyal relationships with gamers.
In-game creators—those who make in-game apps, mods and private servers—are changing the face of the gaming industry and creating a new profession. Although in-game creators are less publicly visible than livestreamers and YouTubers, they are on the rise: In-game creators are estimated to gross over $1 billion dollars in 2023, and this figure is only expected to climb as the demand for UGC increases.
A significant portion of the world’s leading games, in terms of profit, longevity, and actual time spent playing them, are powered by the creativity of their player base. Games including Minecraft and Roblox have created a new way of self-expression for a generation of gamers. In fact, 50% of all games on Fortnite are played on maps created by the players themselves.
This is just the beginning; today’s children are the first generation to grow up with UGC. They expect built-in UGC support in their games, which is quickly becoming the industry standard.
UGC as an industry disruptor
As this generation grows up and the gaming industry continues its rapid growth, UGC will disrupt the industry. The UGC Apocalypse has begun, the Four Horsemen are riding and the brands who ignore the portends of what is to come will surely be left behind. So who are these Four Horsemen?
Growth: While tech and traditional entertainment suffer in today’s economy, the gaming industry is thriving as more people turn to games to escape and socialize. Gaming’s exponential growth continues because it transcends age and people tend to continue gaming from childhood into adulthood. Gen Alpha has a high percentage of gamers, estimated as high as 98%, and younger generations show similar or higher rates—indicating a future where gaming is ubiquitous.
Standardization: More and more games and studios are embracing UGC as a strategy. From companies recognizing official mod hubs for their games to games being launched with built-in mod support, this trend is rising like floodwaters. Once reluctant, evasive or downright hostile towards modding and UGC, gaming companies are opening their eyes to the endless, high-quality, diversified content possibilities available to them via their most avid supporters and users, some of whom spend thousands of hours improving the game in the name of their passion and love.
Demand: Demand for UGC is surging across all games, from The Sims and Grand Theft Auto to games that rely on UGC at their core, like Roblox and Minecraft. There is no way future generations will be satisfied with games that offer fewer content options.
Tools: For those with a creative itch and a love for video games, the world of in-game creation has never been more accessible. Thanks to a wealth of free tools, online courses and, of course, generative AI, even those without a formal background in software development can flex their creative muscles and turn their ideas into reality. From crafting intricate 3D objects to building complete worlds in Roblox or Fortnite, the sky’s the limit for aspiring game creators.
And it’s not just the tools that make this an exciting time to be an in-game creator. Platforms like Overwolf and CurseForge allow creators to host and monetize their creations, offering an unparalleled opportunity for them to turn their passion into profit. The creator economy allows every gamer the potential to become a creator and shape the future of gaming.
UGC is a secret passage for brands
The main challenge for advertisers trying to reach and connect with gamers is to understand what game their audience plays and how to meet and measure their audience engagement in-game.
Partnering with a AAA studio is not only expensive, lengthy and difficult, it also doesn’t reach hundreds of other games relevant to the target audience. UGC is an opportunity to reach over 1,500 games in a scalable, cost-effective and fast way, without compromising on one title or on a non-in-game solution.
Overwolf offers in-play advertising solutions that help brands reach over 35 million monthly hardcore gamers while they are playing in-game. These ads and experiences can target various games in multiple genres, promising unparalleled viewability and versatile, yet relevant, eyes. They are also designed never to interrupt the gaming experience and are seen as enabling the UGC experience, as these ads are how creators earn. In 2022, Overwolf paid out $160 million to in-game creators, with a portion of that amount being generated by advertisers using in-play advertising solutions, actively supporting the UGC community, and letting more and more creators turn their passion into a profession.
UGC is here to disrupt the gaming industry. The brands that see it as an opportunity to connect with in-game creators and the gamer community will reap the rewards and outshine those that do not.
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Shahar Sorek is the CMO at Overwolf, the guild for in-game creators. Shahar leads all marketing and growth initiatives, as well as investor relations. With over 15 years of experience in the games and technology industry, Shahar has founded and managed leading startups including 7 Elements Studios, a game studio specializing in massive-multiplayer-online strategy games.
