A new generation of gamers – reaching Gen Z with experiential advertising

Almost a half hour of the average 4.5 hours spent a day on a mobile phone is spent gaming. And that number is even higher for Generation Z with 86% of Gen Zers saying they are regular gamers. Whether casually playing Scrabble in a dentist’s office or competitively playing games, mobile gaming has a large audience and huge advertising potential.

A channel of new experiential advertising

Far from your standard display campaigns, the gaming landscape is different from most advertising channels. Within most mobile games, the creators take revenue cuts from advertising within the game itself. Various types of advertising, like reward systems, simulation, or even video tads, exist to keep people wanting more within the game. In short, the game will give the user an option to help progress in the game by allowing them to watch an ad for up to 30 seconds, or if they prefer not to watch the ad, they will progress slower. For instance, in games like Jetpack Joyride, a popular mobile game, the ad automatically pops up when a certain amount of progress or time is spent in the game, giving a more streamlined revenue system for the creators because not only does it entice users to purchase the ad-free version it forces people to watch the ads and disrupts their gameplay.

So what does it mean for advertisers?

Gaming as an experiential channel fits nicely into a brand’s overall media mix. Nearly 90% of Gen Z are on their phone while watching TV, which presents an opportunity for advertisers to run CTV and in-game ads to reach a younger and more engaged audience. To engage a younger demographic, it’s imperative to run on multiple screens to reach and potentially convert this demographic. Programmatic DSPs like the Trade Desk and Viant are excellent options for reaching as many mobile gamers as possible with an effective CPM. An average CPM on these DSPs can vary based on the type of creative and games the ads run on. A typical benchmark is anywhere from $8-$20 CPM. Private Marketplaces like X-Flow in the Trade Desk can provide a premium CPM of $7 by targeting Color Rush, a popular mobile and tablet coloring game. Other marketplaces like Venatus that can advertise on popular games like Roblox and Smite have a premium CPM of $16, given the greater demand for these games. Within international markets, it’s vital to run mobile game ads because mobile phones lead video game consoles and desktops as the principal device used for gaming among online users in Germany, the UK, and the US, per a June 2022 EPAM report.

Looking forward

Console giants like Sony and Microsoft are exploring options for free-to-play games with advertising content. With free-to-play games like Fortnite, Roblox, and Call of Duty on both consoles and mobile, in-game advertising is expected to grow tremendously in the coming years. Forecasted to earn $6.3B of revenue in 2023 and projected to grow to $9B by 2025, mobile gaming is something most brands should consider when advertising to Generation Z.