DFC Intelligence Forecasts Global Advertising in Video Games to Reach $7.2 billion in 2016

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Video game advertising is expected to increase substantially as more games go online. Nevertheless, games as an advertising medium remain under utilized based on the amount of time and money consumers spend playing video games.

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Video games have reached beyond adolescent males into a mainstream entertainment medium that touches every segment of the population. Despite this, advertisers continue to under utilize video games as an advertising vehicle.

According to a new report on worldwide trends in video game advertising from DFC Intelligence, in 2010, advertisers spent over $1 billion using video games to advertise their products and service in North America. This includes in-game advertising, around-game advertising, and advergames. By 2014, DFC Intelligence expects advertising in and around video games in North America to nearly double to over $2 billion with steady growth going forward. On a global basis, advertising in video games will reach $7.2 billion by 2016, up from $3.1 billion in 2010.

However, it is clear that as an advertising medium, video games are underutilized. The amount of advertising revenue flowing into video games pales in comparison to other media. Particularly, when compared to the amount of leisure time accounted for by games. Furthermore, a recent DFC report estimated that the worldwide video game industry generated $67 billion in consumer spending in 2011 and will grow to over $81 billion by 2016.

"Video games have reached beyond adolescent males into a mainstream entertainment medium that touches every segment of the population," said DFC analyst Michael Goodman, lead researcher for the report. "Despite this, advertisers continue to under utilize video games as an advertising vehicle. This is slowly changing as more games go online."

According to the report the biggest growth area is delivering advertising around games, not simply placing a static brand message inside a game. Another big growth area is advergames, or games specifically created to deliver an advertising message. By 2016, advergames and around game advertising are expected to account for about 78% of total game advertising revenue.

The report concludes that video games are an effective advertising medium that are not attracting nearly as much advertising revenue as they should based on their usage. "Consumers are inundated with advertising, and marketers’ messages are lost in the clutter. Video games, with their high degree of immersion and interactivity, are a natural solution for building brand awareness and influencing purchase decisions," concludes Goodman.

About Report

Advertising and Video Games is a 45 page report with five year forecasts for the worldwide growth of advertising revenue in and around video games. The report has an overview of types of advertising and includes recommendations for brands, advertising agencies, game publishers and developers.

About DFC

DFC Intelligence (http://www.dfcint.com) is a strategic market research and consulting firm focused on interactive entertainment and the emerging video game, online game, interactive entertainment and portable game markets. Since 1995 DFC has published in-depth strategic market reports and subscription-based research services. DFC research is used by more than300 leading companies in over 30 countries worldwide.

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Ozzie Monge
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