* Social game ad rev to reach $672.2 mln globally by 2014
* McDonald’s, Unilever, Ford on board with social game ads
* Conversion rate for social game ads low-analyst
By Liana B. Baker
April 29 (Reuters) – Self magazine Publisher Laura McEwen
sits in her office in the posh Conde Nast building overlooking
New York’s Times Square and does nothing but play video games
for at least an hour or two a day.
She isn’t goofing off — she is doing market research for
“Self Workout in the Park,” a video game she helped create to
capitalize on the explosive growth of advertising in social
games like the ones played on Facebook and other online
networks.
Once on the fringes of digital advertising, social game ads
are now the hip newcomer for Madison Avenue, with McDonald’s
Corp paying for players to build restaurants in Zynga
Inc’s “CityVille” game and Unilever-sponsored
Dove spas popping up in “The Sims Social.”
The number of people who play social games has ballooned to
hundreds of millions globally, meaning hundreds of millions of
dollars in ad spending in games are up for grabs. Researcher
eMarketer expects social game ad revenue to soar 80 percent to
$672.2 million by 2014. Zynga’s $28.2 million in advertising
revenue in the first quarter, more than double the amount a year
ago, underscores the growth potential of social game ads.
Advertisers like the size of the audience, how they can
target specific demographics and how users can spend several
uninterrupted minutes a day playing a game.
Publishers such as McEwen also like how social games can
lead to branded advertising opportunities. The Self video game
allows for the magazine to sell advertising on virtual weights
and treadmills, for instance.
“All of these things can be branded and new things can
always be created to be branded,” McEwen said.
Giant consumer products company Unilever recently signed a
deal to advertise a range of goods in Electronic Arts’
Facebook games. Players of “The Sims Social” game, which number
about 16.4 million per month, can now stock their bathrooms with
Dove soap or eat Magnum ice cream cones, earning rewards for
using Unilever products in the game.
Unilever is also in talks with Zynga to promote Lipton
products, according to Amanda Richards, the company’s Global
Media Director of Refreshment.
She said Unilever, the No.2 global advertiser behind Procter
& Gamble, has made social gaming a priority in its
digital advertising budget because gamers can get directly
involved with its brands, and they often do so by choice.
“The gaming space gives you a significant amount of face
time with consumers because when you’re in a game, you’re pretty
much not doing anything else,” Richards said.
EARLY DAYS
Overall, social game ad spending is nascent compared with
other forms of online ad spending such as search advertising,
which hit $15.36 billion last year, or banner ads, which
generated $7.72 billion in 2011, according to eMarketer.
Social game ads are in their infancy and there is no
industry standard for which to measure their reach. Conversion
rates, or the rate at which people buy products they have seen
advertised, are also low, according to eMarketer analyst Paul
Verna.
Still, proponents of social game ads insist the results are
there, just perhaps not in monetary form. Bounty paper towels
was quite pleased with a campaign it had in an EA game called
“Restaurant City” that generated more than 500,000 “likes” on
its Facebook page, the company said.
The growth potential of social game ads has caused small
companies to sprout up along Madison Avenue to serve as conduits
between brands and social gaming companies.
Mitchell Reichgut, for instance, left the big advertising
agency world to start the Jun Group, a 30-person company focused
on video ads. Jun Group has already placed video ads promoting
Pinnacle Foods’ Aunt Jemima brand, Claussen Pickles and ConAgra
products in social games.
Other agencies focused on video game ads include Appssavvy
and WildTangent.
Media agency Mindshare has even hired a digital gaming
specialist, Geoffrey Greenblatt, whose full-time job is to
advise his firm’s accounts on gaming.
“Nearly all of our brands are involved to some extent and I
only see it growing as they increase their spending in the space
year over year over year,” said Greenblatt, who wrote a 125-page
book on video game advertising that Mindshare gives to clients.
He predicted that advertising in mobile games that friends
play together is the next growth area. One big move in that area
was Ford’s ‘s “Word of the Day” campaign in Zynga’s mobile
hit, “Words with Friends.” Players get rewards for spelling
words that Ford displays in a banner ad under the game.
“That’s the first step and you’re going to keep seeing
brands get more innovative in mobile,” he said.
