The history of marketing in social games

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Since the early days of social media, games have played a big part in building online communities. Savvy marketers know that the space is ripe with advertising potential, and working the right angle can earn your brand more visibility than from all your other channels - 41% of mobile game users say that they’re likely to pay attention to ads that they’re served while playing (versus 17% for display ads).

Why is marketing with social games so effective? I’ll give you three reasons:

1.) They’re high-engagement: Social gamers are immersed in their activity, and advertising in them makes your brand part of the environment. By marketing through games, you’re guaranteed to put your product or service in front of a captive audience.

2.) They have broad appeal across demographics: Social games are played by people of all ages, backgrounds, and genders, so it’s easy to find one that has the most advertising potential for your target demo. Some brands have even created their own games (AKA “advergames”) to attract new customers and build long-term relationships with them.

3.) They’re experiential-friendly: Playing a game is an experience in itself, and brands that market to social gamers have the potential to become part of players’ worlds both online and IRL. In-game offers and product crossovers have been big hits for many brands advertising in the gaming space, driving awareness and desire for goods and services offline.

While social games have certainly become a hot topic in Ad Land in 2020, the space has been alive and well for over a decade now. Here’s the history behind how marketing has evolved through the rise of social gaming popularity, from the early days to this #unprecedented year.

This year, the Animal Crossing game franchise took the internet by storm with mentions increasing 114% over 2019.

2010 - 2013

As social media matured in the early 2010s, the major players developed more features to meet users’ emerging needs (and of course, keep them on the platform). Facebook led the charge with product expansions - Community Pages, the “Like” button, and Newsfeed filtering, among others - that helped people and businesses alike stay engaged with their friends, followers, and fans. New use cases meant that apps were being created specifically for Facebook, and mobile game makers started dipping into this fresh audience.

The developer Zynga was one of the biggest investors in Facebook’s social gaming ecosystem, hosting dozens of popular games on the platform that captivated players. When Zynga launched “Farmville”, the game had 10 million active users within 6 weeks. With an audience of 56 million people who identified as “social gamers”, advertisers had the unique opportunity for both extreme reach and extreme audience targeting. Brands began flocking to these social games when they realized the access it gave them to millions of potential customers.

Social games gave companies a nontraditional way to engage with consumers, like this virtual McDonald's storefront in Farmville. (Via AdAge)

In one campaign, Cascadian Farms ran a promotion with Farmville where users were given the option to purchase their organic blueberries in the online shop to “plant”. With 550 million instances of the Cascadian Farms’ fruit being chosen over original blueberries, the initiative revealed that many Facebook users will pick a brand when given the choice between a generic option. This was very revealing about the engagement potential that advertisers have with social game users.

This ad integration shows how brands reached players in the early days of social gaming. (Via FarmVille Wiki)

Many brands hit users with pop-ups or customer surveys to get their attention. The more successful campaigns involved an offer of some kind that would reward users for interacting with a brand. Whether the offer was in the game (i.e., an upgrade or virtual product) or a coupon they could redeem in a brick-and-mortar store, players were more likely to engage with an ad that gave them something in return for their attention.

Ad revenue that the company earned through its games helped Zynga build out its app library, while Facebook began to see more and more people spending time posting, commenting, and “liking” things about games. The on-platform engagement helped both Facebook and Zynga thrive. The partnership was so reciprocal that they had an exclusive distribution deal at one point, and Zynga was contributing to 19% of the social media platform’s overall annual revenue.

Even now, Zynga games like Words with Friends still retain their popularity.

Social game popularity continued to grow, and with it the ad marketplace. In 2011, advertisers spent $200 million on social games with everyone from McDonald’s to Goodyear getting in on the fun. It was for a good reason - ads in games had a 24% click-thru rate on average, and campaigns could get more and more personalized as developers launched new games to meet audience demand. By 2013, 40% of all Facebook users were playing social games and their potential ad revenue was estimated to be over $2 billion.

But it was just the beginning...

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2014 - 2017

By the mid-2010s, there were over 250 million Facebook users who were playing games through the social network every day. The market was becoming so massive that it caused new revenue streams in other industries to launch; payment platforms like PayPal became middle men between social platforms and mobile games, boosting their revenue through partnerships with parties on both ends. By 2014, the ad revenue potential for social games was over $8 billion.

Meanwhile, other online games were amassing huge followings through niche social networks of their own. The popularity of esports - competitive online gaming - was on the rise, with developers like Riot Games, E.A., and Epic Games becoming major players who launched some big hits. Fan communities were formed, and live streamed competitions drove them to new platforms to watch their favorite players duke it out.

New social platforms like Twitch emerged as a home for video game livestreams, and communities were built as a result. (HubSpot via Twitch)

YouTube channels and nascent social networks like Twitch provided a place for top players to engage with their massive followings, where they share game streams and tips with them. The platforms also provided a new entry point for brands in the gaming world. Running a commercial during the livestream of a competition was a good way to get around many viewers’ ad blockers, which more and more people were installing on their web browsers.

It wasn’t long before influencer marketing hit gaming - brands started sponsoring pro esports teams and individual players to leverage their audiences and promote their products. In 2017 alone, companies spent $517 million on esports advertising partnerships. Brands began launching exclusive collaborations with top gamers to tap into their huge followings, like the Adidas sneaker created with the Fortnite champ and former Twitch personality Tyler “Ninja” Bevels.

The most popular gamers have risen to fame online, earning thousands of likes on their posts and giving brand partners exposure to their growing audiences.

2018 - 2020

By the late 2010s, games were becoming common places for people to convene online. There was a definitive shift in the landscape of where people were spending their time socializing, and brands were following the money. Ad programs within gaming platforms had developed so that marketers could AB test, retarget, and even use in-app bidding. The global market for gaming had hit $150 billion by 2018.

This ushered in an era with social games where the line between in-game and real-life experiences began to blur. Online competitions morphed into in-person conferences that brought thousands of gamers together from around the world and gave brands another platform to market to their ideal customers.

Honda became an early live event sponsor, partnering with Riot Games as the exclusive automotive sponsor for the League of Legends Championship to be front-and-center with millennial attendees (who happen to be the top purchasers of Honda Civics). Beauty brands like Benefit Cosmetics were official sponsors of the GIRLGAMER Festival in 2018, where they gave influencers product samples to use (and promote) during the event.

This hashtag theme cloud for Benefit Cosmetics and their GIRLGAMER sponsorship shows that many online conversations about the partnership were driven by discussions around live streaming on gamer-friendly social platforms.

Product tie-ins began to make it possible for gamers to express their online selves in their offline lives. After sponsoring TwitchCon, cosmetics brand MAC collaborated with the game Honor of Kings to create a new makeup line targeted at players in China. All of the products sold out in 24 hours. Other luxury brands have seen similar results with capsule collections they launched alongside games. Louis Vuitton designed a clothing line in the virtual world of League of Legends that they then released in real life, and Gucci teamed up with esports organization Fnatic to design a limited edition watch priced at $1,600. In both cases, the products sold out almost immediately.

Gucci’s watch design in collaboration with Fnatic is positioned as a collector’s item for diehard fans.

Games were becoming so popular that competition live streams were starting to outpace viewership for major sporting events. In 2019, the League of Legends world championship earned 2 million more viewers than the Super Bowl. There were now more people spending time on the popular game Fortnite than on Facebook, Instagram, YouTube, and Netflix combined. By 2020, nearly 70% of consumers said that they would rather stop using social media or watching TV than give up games.

COVID-19 and Beyond

In 2020, online games simply are social networks. They have become a safe haven for people to talk to friends and interact with one another during a time when a global pandemic has caused in-person interaction to become restricted.

According to Nielsen, Twitch views are up over 123% this year and the mega-popular game Animal Crossing: New Horizons has made brand partnerships stronger than ever. New campaigns show that, with real-life experiences limited, people actually want to interact with their favorite brands in games.

Companies such as Nike, Valentino, and Marc Jacobs have created virtual “clothing lines” for Animal Crossing avatars as a way for players to express themselves within the game. Some of those initiatives have real-life tie-ins, like a Net-a-Porter marketing campaign where players could collect a QR code to go buy Animal Crossing outfits on the company’s website. Using a QR code generator is an easy way to drive gamers, who already have devices in their hands, to your site.

Net-a-Porter created a virtual store within Animal Crossing where purchases could turn into real-life products. (Via Tong Digital)

The marketing doesn’t stop with product placements. With celebrities stuck at home too, there have been more opportunities to partner with them for in-game events that drive huge numbers of players to platforms. Selena Gomez and Brie Larson both appeared on “Animal Talking” - a podcast hosted in Animal Crossing - to talk about their quarantine experience and recent projects. In April, Travis Scott performed a virtual concert within Fortnite that was attended by over 12 million people. 

Online engagement around both Travis Scott and Fortnite shot up during his performance, with mentions increasing by 178% and 52% respectively compared to the prior month. 

Brands who’d already started advertising within the gaming space have continued to work with platforms and game developers this year to make the best of our abnormal circumstances. Honda became the first brand to sponsor a digital arena event, co-hosting the virtual League of Legends championship with Riot Games. Benefit continued its work with girl gamers, taking their event sponsorship up a notch by launching “Game Face”, a video series with female gaming influencers. These pivots have helped brands stay relevant with a community that they’ve heavily invested in during a year when the retail market has seen a lot of turmoil.

Takeaways

It’s safe to say that the social gaming landscape is constantly evolving. If you’re a marketer that’s looking to get into the huge advertising market in social games, here are the big things you should consider when planning your campaign:

• Be creative and be useful - gamers like to be rewarded, and they’ll reward you with positive engagement if you give them something good. Create innovative ad initiatives that are worthy of their attention.
• Use multi-channel marketing effectively - the more immersive an experience you can create through product or service tie-ins, the more brand recognition you’ll earn from players.
• Make brand integration relevant to your core demo - while there’s a big market in social gaming, find the platform where your target customers live to make the most of your investment.