We all know that video, like some other sub-segments of our industry, has really begun to take off. As we watch the number of large providers consolidate and the number of specialized shops proliferate, what will drive the crush of new video advertising online?
Gamers-- one of the most studied user-cohorts online is the one that is driving much of the video growth in the United States.
Casual game users are the sweet spot for adoption of many broadband technologies. They represent a cross section of so-called streamers, music and video downloaders, and online purchasers. As much as any one behavioral demographic, gamers reflect the growth of online video.
According to comScore Networks, the number of consumers viewing video online grew 18 percent from October 2005 to March 2006. Other research by comScore indicates that approximately 16 percent of all time spent viewing online video takes place during prime time hours, while 22 percent occurs on the weekend. On average, consumers spent close to one hour per month viewing internet video from work locations, where the broadband penetration is obviously higher. (Perhaps this is good news only for our industry). Approximately 42 percent of all U.S. internet users stream video through an entertainment site, and more than 33 percent do so from a portal.
With quality video inventory in high demand, the content provided by game developers is highly desirable by end users and the downloadable casual game is becoming a dominant platform for video advertisers. Some estimate the expected number for casual game download in the United States to hit over than 700m in 2006. In game streaming, video integration can present an opportunity of several impressions per each game download-- summing up to an impressive quality inventory for advertisers.
That's what drove Eyeblaster's recent deal with Real Networks. In this deal, RealNetworks, which is one of the leading developers, publishers and distributors of casual games, provides end users with downloadable games supported by streaming video advertising powered by Eyeblaster technology in exchange for extended free game play.
At the center of our relationship with RealNetworks is a solution that utilizes our tools to help optimize the effectiveness of interactive video and static ad formats in game environments. We call it eb.in-games and it enables easy integration of high quality streaming video ads at natural breaks in the game, delivering a strong impact to the advertiser without compromising the end user experience. According to our research, this will extend and enlarge the current ad-based business model for casual games by enabling marketers to place engaging, interactive ads in the gaming arena.
We're working with RealNetworks' studio GameHouse -- a developer and distributor of downloadable PCgames -- and Eyeblaster's eb.in-games is currently enabled in 12 best selling downloadable games that are distributed via RealArcade and GameHouse. The games include TextTwist, Mah Jong Medley and Sudoku, which many of you -- men and women -- have probably played online yourselves.
That's right-- casual game users aren't just teens and they certainly aren't just male. Different studies put the percentage of female casual game users at 60 percent to 70 percent, and the average age of casual gamers today is in excess of 30. According to Nielsen//NetRatings and RealArcade's 2005 Annual User Survey, casual game users are 68 percent women, and 80 percent of them are between 35 to 64 years of age.
Also, according to comScore Networks:
- More than four in 10 internet users visit a gaming site every month (44 percent Reach)
- Gamers are avid internet users overall: they spend over 48 hours per month on the internet-- twice as much time as the average internet user, and they consume 55 percent more pages on the web than the average internet user.
As the first publisher to deliver advertising in the medium of casual games, RealNetworks is implementing new methods for driving additional revenue for game developers and creating an interactive consumer experience within the games themselves. Until now, in-game advertisements have targeted young males playing core, console video games. This advancement offers an opportunity for advertisers to reach a more diverse audience including the highly desirable ad segment of women over age 30.
Working with RealNetworks, we executed a preliminary study this past May on how gamers regard advertising in the casual game environment. Overall 53 percent of respondents told us that they would watch a short video ad in exchange for free game plays; 35 percent of respondents thought the intervals between video ads is appropriate; and 22 percent said they enjoyed watching the ads. Gamers not only don't mind when game publishers monetize their sites through video, they interact with the videos at much higher rates than any other ad format.
eMarketer research suggests that video advertising will triple in 2007 from this year's figures, up beyond $640M. I can tell you myself, when it comes to this kind of growth, we're seeing it most among gamers. The basic rules apply for video marketers as they do elsewhere on the web: The more precisely you target your ad and the more opportunities for interactivity you provide, the better your results will be. When it comes to your video media plan and your target is women over 30 years of age, if you don't know where to start, casual gamers are a great audience to embrace.
Additional resources:
Read our In Focus feature, "5 Stupid Video Mistakes to Avoid"
Ran Cohen is director, emerging media, Eyeblaster.
