Video gaming: Why it matters to non-endemic brand owners
We are well past the point where video gaming can be viewed as a subculture and readily ignored by brands, says James Redden, Managing Director, 2CV
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It’s hard to read about video gaming without being inundated with massive numbers regarding the size of the industry, but for the uninitiated here are a few that bring the industry’s importance into perspective:
- 30% of all the women, men and children on earth play video games (3 billion in total)
- The industry is massive – bigger than movies and music combined
- Industry revenues are growing at over 10% year-on-year
We are well past the point where video gaming can be viewed as a subculture which can be readily ignored by brands sitting outside the gaming and related industries (i.e. non-endemic brands). It’s now a pivotal part of mass culture, as central to the lives of everyday people as music, TV and sport.
Is it the right audience?
You may be thinking – sure it’s big, but I manage brands in completely unrelated categories (e.g. food, auto, financial services, fashion), so why should I care? Surely marketing and sponsorship investments in video gaming should be the domain of brands in related industries, the Intels, Dells and Microsofts of the world? Does it really matter for me and my brands?
This is a natural reaction and one we have heard from a number of non-endemic brand owners while conducting recent research into the brand opportunities in gaming for the WFA. However this view overlooks a simple point – that while your brand may not be closely aligned with gaming, gaming is where you’ll find masses of potential customers, and if your brand is not present, eventually your competitors will be.
As a comparison, consider marketing investments in traditional sport – while brands aligned with physical activity (e.g. Nike, Adidas) may be best suited to aligning themselves with professional athletes and teams, this has not stopped brands from a wide variety of distant categories from effectively leveraging the audiences that sports provide – some high profile examples include Rakuten lifting its brand awareness in the US by sponsoring NBA franchise the Golden State Warriors and Standard Chartered’s sponsorship of Liverpool in the English Premier League.
Another common objection we heard from brand owners outside of the gaming ecosystem was that while they accept the audience is sizeable, gamers/gaming viewers are “not the right audience for my brand”. This reflects enduring stereotypes of gamers being teenagers or students (with little in the way of income), somehow existing as a distinct audience from more attractive consumer targets. Whereas in reality, the gamer audience is often in the ‘sweet spot’ of millennials who have growing income levels and represent the ideal customer to ‘lock in’ to your brand at a relatively young age.
For example, a US study shows that the average age of esports viewers is 31 and 61% fall into the 25-34 age range (a demographic often viewed as difficult to reach with traditional marketing), with an average annual household income of $64,700. While other data in Asia shows again that gaming is not just teenagers with no money – but the age, gender split and income levels can all differ across markets. (e.g. more than half of casual gamers in Malaysia are female). Statistics such as these should alert marketers that stereotypes about gamers are untrue and that they can be an older and wealthier target than may be expected.
Where to start?
So let’s assume you are convinced that you should start thinking about how your brands can use gaming to further your objectives – e.g. raising awareness, capturing a younger audience or even short-term sales. Where should you start? It can be a daunting question – the one hallmark of gaming is that it is a hugely fragmented industry, with a dizzying array of games, platforms and audiences to consider. The first step we recommend is to build your industry knowledge, for example by:
- Experiencing gaming yourself: play a popular game, attend an esports event, watch and interact with live gaming streamers online (e.g. on Twitch),
- Speaking to people in the know: find the hardcore gamer in your company or talk to industry insiders (e.g. games publishers, esports organisations, gaming platforms such as YouTube or Twitch)
- Understand how other brands have done it: look at brands in (or outside) your industry who have taken the leap into gaming, and consider the lessons their experiences can teach you
This crucial first step reflects the knowledge gap that widely exists within marketing departments – our research showed while brand owners are broadly positive about investing in gaming, there is a lack of understanding about the industry and the opportunities available. This knowledge gap was the catalyst for producing the Gaming Demystified research – and naturally we would highly recommend reading this report as an important early step in building your expertise.
Once you and your team have a sufficient handle on the industry, you can then confidently start considering where you could invest in gaming for your brands, asking questions such as:
- Which of our brands are best suited to being aligned with gaming?
- Which of our brand objectives can gaming help achieve?
- What part of the gaming ecosystem will best help achieve our objectives?
- Who is best positioned to guide us on this journey?
Effectively answering these questions will hopefully provide a clear path forward for investing in the growing phenomenon that is video gaming. And we’d say there is no time like the present – our research showed that 1 in 3 brand owners had invested in gaming in the last 12 months, so it’s now no longer about being the first involved, but ensuring you are not the last!