Gaming's climb to the top of the entertainment heap has been accelerated by the pandemic, yet marketing still feels like it's playing catch-up with an industry that estimates suggest makes more than sports and movies combined. A recent crop of specialist events and tech investments demonstrate that brands and publishers recognize the need to fashion more targeted strategies for a plugged-in but prickly audience.

As more non-endemic marketers try to crack the code on gaming, these trends serve as grounds to experiment with what's working when it comes to getting a message in front of players that extends beyond well-trod digital tactics.

"One of the things the industry is waiting for, writ large, is to find really exciting, scalable opportunities to engage gamers," said David Eichenstein, senior vice president of commercial at 4D Sight, a video monetization platform that specializes in gaming content.

More formal bids to create a media-buying window around gaming include the introduction of the Interactive Advertising Bureau's (IAB) PlayFronts, which the trade group described as the first upfront of its kind. The gathering, which is expected to be annual and will be held for the first time this year on April 5, has a name that recalls the IAB's NewFronts — a significant marketplace for buying digital ads — and caters to buy-side agencies and brands. The full agenda has not yet been released.

"For the size and scale of gaming, it's probably long overdue," Chris Erb, managing partner and founder of the gaming-focused agency TripleClix, said of the PlayFronts.

A big business

The PlayFronts acting as a standalone event speaks to how marketing to gamers is distinct from broader digital media, while also standing as a channel hitting fresh levels of maturity.

Games can serve more traditional ads, but those tend to be centered on the mobile category, which operates very differently from console and PC games. Esports, a favorite among brands, carries sponsorship models that mirror aspects of traditional sports tie-ups. Professional competitive gaming was forecast to exceed $1 billion in revenue globally in 2021, according to Newzoo, but video game revenue in total is believed to draw tens of billions.

"A lot of what you'll see is advertising on esports, which is a pretty small piece of business," Erb said. "But that's kind of where agencies start to focus on."

Marketers that weren't previously aware of gaming's larger dominance have received a few wake-up calls of late. Microsoft earlier this year announced it would acquire developer Activision Blizzard for $68.7 billion, a landmark deal in the industry. For comparison, Disney's purchase of 21st Century Fox several years ago went for $71.3 billion.

"Every time I have a conversation about the size and scale of gaming, it's kind of news to some people," Erb said.

Smaller investments signal that legacy publishers and platforms want to deepen their stake in gaming as well. NBCUniversal last week partnered with Anzu, a developer of in-game advertising and other integrations. The network will act as Anzu's global sales partner and exclusive third-party seller in the U.S. and U.K. Anzu is also backed by WPP.

"In addition to streaming, gaming is one of the fastest growing ways to reach young audiences," Krishan Bhatia, president and chief business officer at NBCUniversal, said in a press statement. "This partnership with Anzu will allow our marketers to engage with an audience of over three billion gamers worldwide, and we’re only getting started."

Breaking misconceptions

Bhatia's comments reinforce that many marketers are gravitating toward gaming in the chase for Gen Z consumers who are notoriously averse to traditional advertising. But the pandemic has further enshrined gaming as an everyday hobby for people across a wide spectrum, while the push for brands to activate on the metaverse — a channel whose foundations share a lot in common with gaming — has experienced a groundswell.

One potential opportunity at events like the PlayFronts is educating marketers about gaming's audience expansion beyond the young, white male cohort. Two-thirds of adults and three-quarters of children under 18 played video games weekly last year, per a report from the Entertainment Software Association (ESA). Roughly 45% of gamers are now women, ESA found.

"One of the things that gets lost in gaming is just how diverse it is," Eichenstein said. "It merits marketers paying closer attention and then looking for opportunities to find them where traditional channels underserve them."

Marketing categories most associated with gaming include snacks and quick-service restaurants — think PepsiCo's Doritos or Mountain Dew, which has a Game Fuel energy drink — but that could start to change. TripleClix worked with OPI, a nail polish marketer, on a spring campaign with Xbox around the new Halo release where purchasing real-world products unlocked special character skins in the first-person shooter.

"It was really about creating a program for an underserved community," Erb said of the OPI work. "If we're going to start talking to broader audiences who are deep into gaming, how do we find the brands that work well for them?"

Esports, too, has attracted a wider swath of marketers and more substantial tie-ups. Progressive Insurance in January signed a mulityear naming rights deal with esports organization Immortals, which is known for competing in League of Legends. Such agreements have grown common as esports events pack stadium-sized venues and drive streams on sites like Twitch.

"If you look at the collection of marketers that are entering the space, from league sponsorships and team sponsorships, there's no question that it's broader, more diverse and representative of the larger advertising market than I think at any point prior to this," Eichenstein said.

With the outpouring of new brand entrants to gaming come risks. In-game advertising is appealing in a business sense, but gamers can be vocal about the intrusiveness of sponsored messages or when a streaming integration goes wrong. As companies try to foster long-term loyalty and deliver tangible value to gamers who are seeking rewards like in-game perks and content, devising a curated strategy should trump porting over approaches that have worked well on other channels.

"What brands are really trying to do is to start to codify these relationships," Erb said. "There's so many examples of people who've screwed up their entrance into the space."