Ed Bartlett of IGA on how in-game ads are here to stay

Do you hate it when you see a poster for a Subway sandwich in between headshots in CounterStrike? Or do you chant when you see advertising hoardings during a corner kick in EA Sports’ FIFA? Pro-G sat down with one of the chief architects of the in-game ad revolution – Ed Bartlett, VP publisher relations Europe and co-founder of IGA Worldwide – to chat about the vocal minority and why Halo will never have in-game advertising…

Pro-G: So, in-game advertising (IGA), how lucrative is it for publishers right now?

Ed Bartlett: Right now it’s more lucrative than some people think it is and it is less lucrative than others would like it to be. We’re currently a $50-$120m industry. There are reports on the market talking about a billion by the end of this decade. That’s pretty significant given that it’s come from zero as long ago as three or four years. In terms of how lucrative to any individual publisher, it very much depends on their inventory. At the end of the day we can only sell what a publisher has in terms of reach, which is unique users. If a game sells 20,000 units, we may struggle to get advertisers in there. Somebody like EA, which has a huge portfolio of lucrative, high-reach, commercially viable games you expect to see advertising in, then it can be fairly lucrative. You look at people like Ubisoft who are quoting IGA as maybe being as much as 10 to 15% of their overall revenues.

Pro-G: What types of games are best suited to IGA?

EB: Our core focus is to find placement within environments where you would expect to see advertisements. If you were to take a racing game, if you were driving around Silverstone or Laguna Seca, you would expect to see sports hoardings, billboards and advertising for car companies or oil companies or whatever it may be. Games today are very different to 10, 15, 20 years ago. It’s become much more about suspension of disbelief, immersion and realistic situations where you would expect to find yourself but being able to play it from the comfort of your living room. If gamers don’t see the realism, if they don’t see the real brands, don’t see the real team names in a football game, then that’s breaking the suspension of disbelief. So we believe as long as it’s contextual, as long as we’re putting the right placements, the right type of adverts, the right brands within those situations, we’ve certainly seen that gamers have been very positive receiving this.

Pro-G: So sports games and racing games…

EB: And realistic city based action games, film licenses, anything that fits in. We’re also experimenting with some other options such as the Acclaim deal that we have, where you have a fully featured MMO where we’re working on video, but in return it’s completely subsidising the use of that game to the end user. So it’s not about being within the game environment itself, it’s about tagging on in front, while you’re waiting for the game to load for example. It’s all about getting that aggregate reach for an advertiser.

Pro-G: You talked about contextual IGA, would it be a case of it doesn’t matter if it’s Halo 3 or Halo 30 you could never really have IGA in that type of game?

EB: That’s pretty accurate. If you go back 15 years the majority of games would be space shoot ’em ups and fantasy games. Nowadays the market, even if you look at the MMO market which was built originally on MUDs and text-based adventures, which were very fantasy oriented, even now you’re seeing that genre transferring into more realistic contemporary settings. Things like MMO soccer games and sports games, the idea that every person is a human. That really opens up a huge amount of inventory, because every person who plays the game is generating impressions which are saleable.

Pro-G: Do you think then it might be a case that we’ll start to see more games of that kind because they have an opportunity to have additional revenue from IGA?

EB: It’s possible, but by and large we’ll just see more creative concepts coming to market. Because the market has become so hit driven and because the margins are getting smaller and because the cost of production is getting higher, we’re seeing less and less new creative opportunities and more and more sequels. That creates a stale market. By bringing in new revenue streams what we’re able to do is allow new concepts to come to market that maybe wouldn’t have before.

Pro-G: So you’re helping innovation?

EB: Absolutely, that’s what we like to think.

Pro-G: What do you think gamers think of IGA?

EB: We’re in the middle of probably the biggest research study ever to be undertaken in this sector specifically to answer this question. Neilson did a study in 2004 with Activision, and they had over 70% of gamers saying that they like the advertising to be there, but again it always came under that caveat it had to be contextual. That’s the entire watchword of our business. If it’s not contextual it’s not effective to the advertiser because you don’t get the right brand effect, people aren’t positive towards it, it’s not effective to the publisher because it turns the gamer off to their games, and obviously it’s not effective to the consumer because it interrupts their experience. So there’s not a need or a desire for us to do that.

Pro-G: We’ve had static IGA for a while. Can you explain dynamic IGA please?

EB: Dynamic is really where the industry has grown from. Static has been happening as far back as Outrun and there were even advert games; look at Zool with Chupa Chups, that’s going back to the 80s and early 90s. The big difference now is being able to aggregate into a network and to be able to dynamically update and to be able to track. It is a small piece of technology, completely proprietary developed from us for this specific need and use. We work with the developer at an early stage. They integrate the SDK into the game, a very small piece of code and then as the environmental artists are building the game levels they take the billboard locations and then tag them with our SDK. We’re able to then inventorise those ad placements into our network and aggregate them along with all the other games we have, all the locations we have, profile them by genre, by demographic and then we take that inventory and then sell that directly to advertisers.

Pro-G: So that would work with online games but not offline games?

EB: No. There has to be some type of connection. It doesn’t need to be pervasive; they can join maybe once a week, once a month, and we can cache advertising, we can cache the impressions coming back. The other key factor is we measure the size and the time on the screen of the advert. Because we’re tagging these objects in a 3-D space, the game engine treats it as it would, as it renders it. We’re able to then say: in real time this is the size, deflection angle and the length of time this has been on screen. The reason this is really important for the advertiser is that with TV advertising you don’t know if somebody’s talking to their friends, they may be reading a magazine, they may not even be in the room at the time. With games because you have to control the character or the vehicle and progress through that level you know that the end user is looking at the screen. We can then say to an advertiser we’re not measuring an impression until it reaches a certain quality metric and they then pay on a cost per thousand view basis, which is similar to how they treat other media. They know there’s no wastage. This is the problem they have with traditional media. You pick up a magazine and you probably flick the first 10 pages because it’s just adverts, it’s meaningless to you.

Pro-G: There’s been some concern from a vocal minority that this is perhaps infringing on what they believe is their free right to play a game anonymously. What do you think about that?

EB: Firstly, coming from a gaming background myself, I’m well aware of the vocal minority. In fact 15 years ago I was once of those vocal minority. It’s really a misunderstanding. There’s been a certain amount of people that think we’re spyware, that think we’re doing things on their computer that we’re not, for example linking into their browsing habits. There are two distinctions. Firstly, the type of advertising that we’re serving doesn’t need that kind of data. This is something your readers might not know: you have two types of advertising, above the line and below the line. Above the line is print, outdoor billboards, TV advertising, and what that’s doing is promoting the awareness and image of a product. And then you have below the line, where you’re driving a transaction, like online, direct marketing and point of sale, and you’re able to track back to a sale and an advertiser knows that this advertising has generated these sales. What we focus on is the above the line, the real high value media. We’re creating online networked outdoor advertising, because those are the types of placements that we’re using, like outdoor billboards. We don’t need to collect personal information and our technology isn’t even able to collect personal information. We don’t know that you’re John Smith in Clapham, for example. All we know is that this unique user has seen this ad in this game. So we’re not collecting any personal data. We don’t know your browsing habits. We don’t know what other games you’re playing. It’s purely that this anonymous thing has seen this advert and that’s all the advertiser needs to know.

Pro-G: So why do you think the vocal minority has issues with this?

EB: There’s a certain vocal minority that just like to have issues with things. Whether that’s the level balancing, whether it’s the weapon balancing in a game, these kind of people tend to think the game has been developed just for them, and it’s our game and it needs to be exactly how we say. What they don’t realise is that in many cases there are several other million people playing that game. You can’t please all of the people all of the time.

Pro-G: So there’s always going to be a certain number of people who are not going to like IGA?

EB: You’re never going to get 100% agreement on anything from a sizeable sample group of an audience. It’s just unheard of. We need to communicate to these people that you may not agree with it, you may not like it, but we’re not doing anything sinister. We’re not ruining your game experience. We’re not doing pop up ads that you have to click through to get to your game. This has been happening for years, it’s been in there statically, and no-one complained about it because nobody talked about it. It’s only because we’re now talking about it and publishers are making money from something they’re already paying for that they have a problem. But what they don’t see is the real economics of the sector and understand that you need this, otherwise the industry is going to stagnate.

Pro-G: One of the things IGA is supposed to help is with publisher bottom lines. Gamers think this is great if it’s going to make my games cheaper. But we haven’t seen a reduction in price in terms of AAA titles, new releases and chart games. Do you think IGA will ever drive prices of those types of games down?

EB: Those types of games are on the consoles. The problem we have within that sector at the moment is that Sony hasn’t yet agreed a strategy for this so there is no dynamic IGA on the Sony platforms to date. Microsoft purchased a company to do this themselves, so they’re now controlling that space. So there isn’t the scalability yet. The bulk of the market today is on the PC. What we have seen on the PC is situations where you have completely subsidised content. Look at Trackmania Nations, that’s a fully featured game, hours of game play, incredibly high quality graphics and production, and yet you can download it today and play it. There’s no play it for two hours and you have to pay and they have built an audience of over six million people with that game. Similarly the Acclaim games, games that typically you would be charged at full retail price, things like 2 Moons, 9 Dragons, those are fully featured MMO games, very high production values, they’ve had big teams working on them, huge investment, and they are completely free of charge. So on the PC side of things you are already starting to see that.

When it comes to console the scalability isn’t there yet. It will be. And also you have things like cost of goods to take into account. Sony, Microsoft and Nintendo all take a royalty share of every disk that gets manufactured, and so there are other costs that come into play when it comes to console. What you will see is that it will help stabilise the market. It won’t necessarily reduce the prices of those games, simply because the budgets are so huge. But we’re already seeing up to $2 a unit generated, which in the future may help to subsidise.

If you look back 10 or 15 years ago, to the end of the 16bit era with the Mega Drive and the SNES, people were paying up to 85 pounds for a cartridge because of all the technology that was included. If you then fast forward to today, if you include inflation, that’s an incredible price to pay. In actual fact what you’re getting nowadays is incredibly featured games, online features, look at the production values, all the tie-ins, and yet if you take into account inflation it’s significantly cheaper now than it ever was.

Pro-G: What’s the next high profile game we’re going to see IGA in?

EB: We’ve just launched with Colin McRae DiRT, which is doing fantastically well. It’s a great reinvention of the Colin McRae series. In terms of what we’ve got coming up, we’ve got numerous announcements that are coming out soon. Unfortunately can’t talk about them today. We’re focused on very high quality, high reach, high sales, AAA games that are relevant to advertising.

Pro-G: Tell us about the IGA in Colin McRae DiRT?

EB: Our producers have worked with the developers at Codemasters and worked out where the best locations are for the billboards. A big differentiator we have is we need fewer impressions per hour for the way that we work. What that means is the gamer doesn’t have millions of billboards coming at them. If you look at certain other games sometimes they’re overly saturated, and it’s not effective for the advertiser, because if you’ve got 50 different brands on screen at once you’re not going to recall them and it also doesn’t look great, it doesn’t fit into the game. We try and work seamlessly with those games and the publishers so as you’re playing the game you’ll see billboards at the start line for example, on the grid, or if you’re in the stadium-based levels you’ll see them where you would expect to see them if you were watching a rally in real life.

Pro-G: Are they dynamic ads?

EB: Yes. So we can update and change and target those billboards. For example if you’re playing the game in Germany online against someone in the UK, you can be on the same section of track but you will see different ads on your local computer. So the German guy sees German ads and the UK guy sees UK ads.

Pro-G: So what will IGA be like in games five or 10 years down the line?

EB: It will be much more high fidelity. There will be more refined ways of working out where the billboards should go for example. So you will see less overall volume of billboards but much more thoughtfully and effectively placed. You will also see more brands getting involved with giving away content. A lot more free downloadable content, add-on packs. We’ve got some cool announcements around that that have already happened we just haven’t announced them yet, whereby brands have basically subsidised free, high value packs of new content, whether it be maps or add-ons or vehicles. A good example is car manufacturers. You’re able to now show people what your car looks like, almost like a virtual showroom, and then you can drive it around a circuit. A person playing that game is the kind of person who is going to buy that car.

It will tie in to real world promotions. For example you buy a soft drink and it gives you an unlock code where you can then go and unlock a new piece of content in the game. What you might see is ads caching data then when you leave the game you see the ads in a web browser, but not in an intrusive way. You won’t see ads in-game that you can click and they take you to a transaction – the publisher simply wouldn’t allow it.

Pro-G: That’s great. Thanks for your time.

What do you think of in-game advertising – an ad too far or a sign of things to come? Get it off your chest in the comments section below.