In-game ads sector risks cannibalising itself, warns Bartlett

The in-game advertising sector is showing signs of cannibalising itself, with company acquisitions dividing up the market and making growth more difficult, according to IGA's Ed Bartlett.

Speaking at the Northern Exposure conference yesterday, Bartlett warned that acquisitions of in-game ad specialists make work harder for the developer integrating the technology, as well as the advertiser trying to reach audiences through multiple platforms.

"Already we're at a stage where we're starting to cannibalise our own sector," stated Bartlett.

"We have a situation where we're serving ads to PC and serving ads to mobile, but we're currently locked out of Xbox 360 because Microsoft owns Massive Inc and it's trying to control that space."

"That's where problems are starting to happen. Obviously, Massive is never going to get onto PlayStation 3 because it's a Microsoft-owned company."

"What happens then is that an advertiser is going to have to buy into the same game from two different networks and the developer is going to have to integrate two different software development kits, both of which will probably have different measurement metrics."

For Bartlett, standardisation can't come soon enough.

"Over the next couple of years we're going to see standardisation because fragmentation is a real bugbear," he said.

Bartlett also had advice for publishers and developers looking to take advantage of the growing market for in-game advertising.

"Don't fear the gamer," he said. "As we all know gamers are notoriously vocal — certainly there's a core demographic who make a lot of noise for their actual size."

"Users are outraged because a feature in a game has been tweaked. At the end of the day you're giving them content so don't be afraid of them — publish and be damned."

"Advertising has been happening for years, it's only because we're issuing press releases that it comes to their attention," commented Bartlett. "The majority of people are okay with in-game advertising. Research shows that 70 per cent of people actually like in-game advertising because it adds to the realism."

And finally Bartlett said that publishers should be happy to work with rival company's as advertisers are looking to buy into a network of similar titles, not specific games.

"Don't fear your competitors. Publishers will say that they don't want to be in the same network as a company that has a similar game or a similar genre. That's incorrect, it's better to be in that same network because you then create verticals and advertisers want to buy a specific demographic."

"It's very, very powerful. If you have five or six football games that network is going to bring in more dollars because of those numbers. There is no direct competition because advertisers don't want to buy just one football game over another," he revealed.