Study: Mobile gaming more popular than social media

Brief:

Mobile gaming has become so ingrained in smartphone usage that 69% of U.S. consumers said they would rather give up social media apps or TV than lose their favorite mobile games, per a study that mobile ad firm Tapjoy shared with Mobile Marketer. Eighty-seven percent of respondents said they have been playing mobile games for more than two years.
In-game advertising also is more compelling to U.S. consumers than ads in other media. The survey found that 41% of people are likely to pay attention to ads in mobile games, ahead of the internet (17%), magazines (15%) and billboards (15%). While consumers consider many forms of digital ads as annoying and intrusive, 72% said they like interacting with ads in exchange for in-app currency or premium content.
The portion of consumers who identify as a "gamer" rose to 60% this year from 27% three years ago, when Tapjoy last ran a survey. At that time, two-thirds of respondents didn’t identify as gamers even though they played games several times a week. Tapjoy surveyed more than 18,000 U.S. consumers ages 18 and older in February and March.

Insight:

Tapjoy’s finding that U.S. consumers are more attached to mobile games than to social media helps to explain why social networking companies like Facebook and Snap are investing in gaming platforms. Facebook introduced a new gaming tab for streaming content and Snapchat launched a multiplayer gaming platform, while Google and Apple are also getting into gaming. These gaming pushes by mobile-first companies will potentially create new opportunities for marketers.

In addition, as Epic Games has demonstrated with its hit multiplayer game "Fortnite," games also can act like social networks among fans who gather to play, watch others compete, chat, share strategies and even attend virtual concerts. Epic is parlaying that popularity into creating its own social network and app store to avoid paying download and subscription fees to Apple's App Store and Google Play.

Game developers that seek to monetize their content are opening up their apps to various kinds of advertising. Rewarded video or opt-in video ads give gamers incentives to watch a video by offering points or other valuable gaming content like levels, lives or virtual gear. The format produces the highest click-through rates among video ad formats, according to research from mobile ad platform Smaato, and is offered by 65% of mobile game developers, DeltaDNA found. U.S. spending on in-game ads will grow 16% to $3.25 billion this year from $2.8 billion in 2018, eMarketer forecast.

The smartphone era has helped to grow the consumer base for video games from a small niche of enthusiasts, typically consisting of teenage boys, into a mainstream content and marketing platform. At the same time, esports gaming has become a new platform for marketers, with brands like Axe, Gillette and Red Bull get into an ad revenue market that is forecast to $200M by 2020.