(29 August 2008 1:00 pm)

MUMBAI: Succesful advergames keep things simple but offer players a real challenge.

For instance FreeRice, an advergame that raises money for the UN Food Programme, is just a multiple-choice vocabulary game that gets harder as users progress. At 10 to 20 grains of rice per correct answer, FreeRice players generated nearly 35 billion grains of rice between October 2007 and May 2008..

Havas Media has published a white paper on the trends in digital advertising in the gaming industry. An advergame is an online or downloadable game where the primary objective is to deliver advertising messages, drive traffic to web sites, and build brand awareness.

The company says that another great example of advergaming was the 2006 series of branded Xbox games from Burger King. These games integrated King, a quirky character from BK marketing campaigns, and were an immediate hit.

The advergames were sold exclusively in BK restaurants for $4 each with the purchase of a Value Meal. Brand awareness went up, Value Meal sales spiked, and Burger King sold more than 2 million games ($8 million) in just four weeks, creating an entirely new revenue stream.

Advergames are commissioned or sponsored by a marketer, and designed from scratch around a brand or product. They deliver brand messages, drive web traffic and build awareness. Most can be played for free. It’s a simple value exchange: Users give a brand their attention, and the brand provides an entertaining experience.

Advergames are incredibly flexible. They can be developed for IM applications, banner ads, mobile devices, interactive billboards, web sites, Facebook applications, widgets and
more.

In-game advertising meanwhile integrates a brand into a pre-existing narrative. In-game ads can be static, meaning they stay the same every time the game is played, or dynamic, meaning they can be manipulated via an Internet connection to precisely target the player.

Static in-game ads are typically hard-coded during development and appear as billboards or props, like vending machines, or on game menus and loading screens. Usually, a player can interact with branded billboards, signs and more to get information he needs to progress in the game. McDonald’s and Coca-Cola in Doom 3. Two-thirds of all video game ad spend in the US will be ‘in-game’ by 2012.

Dynamic in-game ads can be updated every time the game is played, if the PC or console is connected to the Internet. The ad-serving agency factors in the user’s geographic location, the day of the week, time of day, length of play, and any other available user information. Marketers can get data on exposure time and ad type, and agencies can optimize performance.

This kind of highly targetted advertising is currently available on a wide range of titles for the PC and Xbox 360 (Xbox Live). Sony recently announced it would allow all ad-service companies to reach its PS3 user base (except Microsoft’s Massive, a huge competitor). Nintendo has a no-advertising policy for its consoles.

An ad server can deliver specially targetted ads to a gamer in France and a gamer in the US, even if they’re playing each other. But static in-game ads are trickier. The right ads have to be placed in each version of the game during development. Red Bull, for instance, is a perfect fit for many game titles, in many countries – but not in Scandinavia, where the stuff is illegal.

In terms of variations there are pre-game, post-game and interstitial ads. These can roll before gameplay even begins – for example, as a loading screen – or after a specific level or time period, or at the end of a game session. One distinct advantage of video-game sports over real-life sports is that there are no diet restrictions.

Sponsorships allow a marketer to own 100 per cent of the territory in and around an existing game. A brand can sponsor a gaming tournament, a zone, or even the release of exclusive content, like unlock codes for special features, hidden items, extra levels and more.

Product placement in video games works a lot like placement in movies or television, with opportunities for integrated brand messaging, sponsorship, and use of products or services by the characters.

These elements are typically hard-coded into games and can require long lead-times, usually nine to 18 months prior to release. Rising game development costs (now into the millions) sometimes force marketers to make a significant investment upfront.

The study notes that this can be worth it. The brand could be permanently associated with a high-profile entertainment franchise. In the 2003 film Tomb Raider: The Cradle of Life, Lara Croft (portrayed by Angelina Jolie) traded in her Land Rover from the first film to drive a specially equipped Rubicon edition Jeep Wrangler. The Wrangler Rubicon (image left) was also one of several Jeep vehicles featured in the 2006 Eidos game, Lara Croft Tomb Raider: Legend.

The challenge is the long lead-times. Some games take three to five years to produce, well beyond the shelf life of most ad campaigns. Since no one ever knows whether a game will be a hit, a pact upfront is a gamble. One could wait for the sequel – but if the first is a blockbuster, the price of a deal will rise accordingly.

Co-branding gathers many of the best elements of video game advertising. For example, Lego announced in May 2008 it was building a subscription-based MMOG for kids, Lego Universe. Players have to spend virtual money to buy bricks, but they’ll earn more just by playing the game.

Game skinning lets a brand sponsor display units around game content and includes custom branded integration in the game. This isn’t as expensive as other executions but also doesn’t allow for as much creativity, as it’s akin to recycling an existing game. The challenge here is gamer backlash. This is one of the biggest potential pitfalls. If advertising is too obvious or clunky, or it detracts from the game, one will get the opposite of the reaction one wants.

Plus, according to Nielsen research, well-placed ads can actually further the plotline of a game and expand the consumer base for a brand. When in doubt one could ask whether the player is getting any added value from your ad placement, and whether its placement will strike the player as organic.

One of the major players in the in game advertising space is Massive. Massive, a wholly owned subsidiary of Microsoft, delivers dynamic in-game advertising for more than 40 game publishers. Massive can target users by geography, time, day, session length, and other user information. Massive software codes must be integrated into games during development.

Massive’s relationship with Microsoft restricts it to PCs, Xbox and Xbox 360 platforms. On the flip side, marketers who want a piece of Xbox 360 or any Microsoft game, must work with Massive, since no other companies are permitted to serve ads in its games.

It’s restrictive, but apparently it’s effective. In a 2007 study by Massive and Nielsen Entertainment, ingame ad campaigns in the Massive network got results. Average brand familiarity increased by 64 per cent. Average brand rating increased by 37 per cent.

Average purchase consideration increased by 41 per cent. Average ad recall increased by 41 per cent. Average ad rating increased by 69 per cent.

The study notes that these days, consumers expect marketing to be creative, engaging and even useful, just like any other digital content. Video game advertising, specifically, is going through such an evolution, offering marketers new methods to reach consumers in ways that make a positive impact.

Brands can become part of the storyline in top console games, engage consumers with advergames, and participate in virtual worlds.

In addition, the largest game releases such as Grand Theft Auto IV and Halo 3 are of such high quality, they create bigger social events than some of the largest Hollywood blockbusters.

In addition, like Hollywood blockbusters, many major games titles are released globally, offering dynamic advertising opportunities as ‘local’ as the marketer desires. All that flexibility means there’s a fit for almost any brand and any demographic, from teens to moms, and from business people to seniors.