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The in-game advertising market size is estimated to grow at a CAGR of 13.25% between 2022 and 2027. The market size is forecast to increase by USD 5,182.68 million. The growth of the market depends on several including the increase in the number of gamers and growing partnerships between advertisers and video game companies, the increase in the popularity of mobile gaming, and the growing popularity of dynamic in-game advertising.
This in-game advertising market report extensively covers market segmentation by Type (static ads, dynamic ads, and advergaming) and Geography (North America, APAC, Europe, Middle East and Africa, and South America). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The increase in the popularity of mobile gaming is a key factor driving the market growth. Mobile games are becoming a large part of the gaming industry as many gaming brands are focusing on app design. Consumers can install gaming apps from app stores such as Google Play Store and Apple App Store easily in just a few clicks. The popularity of mobile gaming is increasing as many game developers are adopting the freemium model wherein the initial level of a game is offered free of cost, and users need to pay for accessing the advanced levels. Freemium games are generating higher revenue than premium games, especially in-game advertising. The demand for these mobile games is increasing due to the rise in the use of smartphones. For instance, smartphones accounted for more than four-fifths of the global mobile game market, whereas the rest was contributed by tablets.
Mobile-based games can be accessed without additional costs for updated versions if they are within the subscription period. These factors are encouraging more gamers to opt for mobile gaming, thus leading to an increase in the popularity of mobile gaming. For instance, the mobile gaming market is expected to grow to over USD 170 billion by 2021. In-game advertising in mobile games ensures that the advertisements shown are related to the user. These advertisements can be found anywhere within the game in the form of interactive advertisements, static banners, and interstitial advertisements. Hence, these benefits will lead to an increase in the popularity of in-game advertising in mobile games, which, in turn, will drive market growth.
The emergence of programmatic in-game advertisements is a key trend boosting the growth of the market. Real-time bidding (RTB) and artificial intelligence (AI) are utilized to place these advertisements in online games. Previously, salespeople were responsible for buying and selling in-game advertisements, which could be costly. However, with the advent of programmatic advertisement buying, the process has become more efficient and cost-effective by eliminating human involvement. In the traditional method, advertisers had to go through proposals, quotes, tenders, and negotiations with humans to purchase in-game advertisements. Conversely, programmatic in-game advertisement buying employs algorithms to acquire display space. The streamlined and effective process of programmatic in-game advertisement buying has prompted some companies to invest in offering superior solutions in this domain.
An example is Anzu.io, an in-game advertising platform that expanded its programmatic in-game advertisement services for Xbox in November 2019. By using this platform, Xbox game developers can enhance the gaming experience for players while maintaining control over advertisement formats, content, and analytics. This advancement in programmatic in-game advertisements has the potential to stimulate market growth in the forecasted period.
Unrelated placements of advertisements are a key factor hindering the growth of the market. The placement of advertisements is a crucial factor in in-game advertising, as it must align with the game's flow and context. It is important for advertising enterprises to strategically place ads in a manner that appears natural to gamers and offers exclusivity to advertisers. Unfortunately, some advertising enterprises fail to do so, leading to disruptions in the gaming experience and negative effects on advertisers' brand /image.
For example, displaying sports-related ads in food-themed games would be an inappropriate placement. The intention of in-game advertising is to create brand awareness among the target demographic, but unrelated ad placements can make the brand feel out of place and have a detrimental effect. Consequently, unrelated ad placements can harm the brand /image and undermine advertiser trust in in-game advertising, potentially impacting market growth in the forecast period.
Based on type, static ads hold the largest market share. In this type of advertising, enterprises can choose the frequency and time of ads, especially while targeting a specific group of customers. For instance, if the ad is regarding an ice cream parlor, enterprises can choose to display that ad when the outside temperature is above a certain limit.
Figure 1: In-Game Advertising Market by Type (2017-2027)
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The static ads segment showed a gradual increase in market share from USD 1,577.80 million in 2017 and continued to grow by 2021. Due to technological advances, digital advertising displays can now connect to customers' mobile devices, redirecting them to enterprises' social media accounts or websites. Static advertising can also incorporate augmented reality for interactivity, attracting enterprises to use these technologies in outdoor ads to raise awareness. In a London campaign, an augmented reality app connected to a digital screen displayed an /image of a sick patient and an empty blood bag. Visual recognition triggered potential donors with a needle and tube on their mobile screens, showing virtual blood flow and the patient visibly improving. These features make advertising appealing, contributing to the growth of the global in-game advertising market.
Figure 2: In-Game Advertising Market by Region
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North America is estimated to contribute 35% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
The North American in-game advertising market is projected to grow due to the rising popularity of mobile and console gaming in countries like the US and Canada. The high penetration of smartphones and Internet access has led to a significant increase in mobile gamers. The demand for AAA games with advanced features in gaming consoles is also on the rise, fueled by increased console sales. Additionally, the growing popularity of e-sports and the involvement of sponsors contribute to the market's growth. Overall, the North American in-game advertising market is expected to expand in the forecast period.
In 2020, due to the COVID-19 pandemic, sports events across North America were canceled. This had a negative impact on the global in-game advertising market in North America. Though the market was negatively affected by the cancelation of sports events across North America, the growth of the online gaming segment contributed to the growth of the market in focus. Increased smartphone penetration and the availability of spare time encouraged the adoption of mobile gaming solutions among individuals across North America. Owing to this, the global gaming market in North America experienced significant growth in 2020. Hence, the in-game advertising market in the region is expected to grow during the forecast period.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Hotplay.games- The company offers in-game advertising platforms such as Invictus and Evergleam Hill.
The research report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Activision Blizzard Media Ltd., AdInMo Ltd., Alphabet Inc., Anzu Virtual Reality Ltd., Bidstack Ltd., Flurry Inc, InMobi Pte. Ltd., ironSource Ltd., Motive Interactive Inc., Playwire LLC, RapidFire Inc., Wam Group Ltd., and WPP Plc
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The in-game advertising market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
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In-Game Advertising Market Scope |
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Report Coverage |
Details |
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Page number |
160 |
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Base year |
2022 |
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Historic period |
2017-2021 |
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Forecast period |
2023-2027 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 13.25% |
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Market growth 2023-2027 |
USD 5,182.68 million |
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Market structure |
Concentrated |
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YoY growth 2022-2023(%) |
9.75 |
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Regional analysis |
North America, APAC, Europe, Middle East and Africa, and South America |
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Performing market contribution |
North America at 35% |
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Key countries |
US, China, Japan, Germany, and UK |
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Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Activision Blizzard Media Ltd., AdInMo Ltd., Alphabet Inc., Anzu Virtual Reality Ltd., Bidstack Ltd., Flurry Inc, HotPlay, InMobi Pte. Ltd., ironSource Ltd., Motive Interactive Inc., Playwire LLC, RapidFire Inc., Wam Group Ltd., and WPP Plc |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Platform
7 Market Segmentation by Type
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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