In-Game Advertising Revenue to Reach $971MM by 2011

In-Game Advertising Revenue to Reach $971MM by 2011

The global in-game advertising market, which generated $77.7 million globally in 2006, continues to develop at an exponential rate and will, by 2011, grow to $971.3 million in worldwide in-game advertising expenditures (fixed product placement/static ads and dynamic ads), according to a recent Yankee Group report.

This year alone in-game ad expenditures will more than double, reaching $182.7 million, according to the report, “Advertising and Games: 2007 In-Game Advertising Forecast.”

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Additional findings in the report:

  • Dynamically placed 2D ads will cannibalize static in-game ads, but fixed product placements will continue to grow through 2011.
  • The number of games with in-game ads will double annually through 2008.
  • In the near term, PC games will drive the market for dynamically served ads.

New media growth is eclipsing that of traditional advertising media, according to Yankee: Spending on traditional advertising media (television, newspapers, radio and magazines) grew $3.6 billion last year, while spending on internet advertising grew $4.3 billion.

As one part of that trend, connected game devices are becoming the foundation on which providers build dynamic in-game ad insertion, Yankee said.

“Advertisers are increasingly finding in-game advertising to be a greater investment value because of the variety of opportunities that exist in and around games. Video games represent an ‘above the line’ opportunity, which means that video games should be used to build brands and not as a call to action that distracts from the game play,” said Michael Goodman, director of digital entertainment in Yankee Group’s Consumer Research group.