May 10, 2023
By Anjali Kochhar
Strap: Of the global digital ad market, video-game advertising accounts for ~6 per cent i.e., USD 8 billion. With the metaverse entering the picture, experts predict this share to increase in the future. Question is – how effective would it be for Metaverse to enter the realm of in-game ads?
The global metaverse industry is likely to surge to a whopping value of USD 936.6 billion by 2030, according to Statista estimations. Alternately, MarketsandMarkets expects the industry to generate a revenue worth USD 426.9 billion by 2027. Both figures imply a common point – the world will witness a metaverse boost in the future. The question is – how?
One of the soaring points supporting this surge would be in-game metaverse advertising. Of the global digital ad market, video-game advertising accounts for ~6 per cent i.e., USD 8 billion. With the metaverse entering the picture, experts predict this share to increase in the future.
Question is – how effective would it be for Metaverse to enter the realm of in-game ads?
Ongoing & undoing trends within in-game advertising
Largely, the motive for using in-game ads is to tap into a wider audience. This, however, is leading to ad fatigue.
Yash Pariani, CEO and Founder, House of Gaming, explained, “One potential trend is ad fatigue, where players become overwhelmed or annoyed by the amount of advertising in games. If players feel that advertisements are intrusive or disruptive to gameplay, they may begin to have negative associations with the brand being advertised.”
Countering ad fatigue, gaming companies have introduced ad-blockers. “Another trend is ad-blockers, which allow players to block in-game advertisements. While ad-blockers have been more commonly associated with web browsing, they are increasingly being used in gaming as well”, stated Pariani.
What then comes to mind is how metaverse can tap into both undoing trends – ad fatigue and ad-blockers.
Potential of metaverse
According to Shrikant Bhalerao, Co-founder and CEO, Seracle, “Metaverse has the ability to offer a more immersive and integrated advertising experience. In the Metaverse, ads can be seamlessly integrated into the virtual environment, enhancing the user experience rather than detracting from it.”
By enhancing user experience and engagement, metaverse can deter the challenges currently faced by traditional in-game advertising. Moreover, it will propel advertisers to use non-intrusive methods of communicating with their target audience.
India’s metaverse infrastructure
If in-game advertisers in India have to adopt the metaverse, they require adequate funding and infrastructure. Currently, however, metaverse is still in its nascent stage with potential seemingly, aplenty.
The Seracle CEO explained, “India has made significant progress in developing its digital infrastructure in recent years, with the government’s Digital India initiative driving growth in internet connectivity and digital literacy.”
He further went on to explain the factors that need to be resolved for Metaverse to penetrate the Indian market.
“The adoption of metaverse-based in-game ads in India will depend on several factors, such as the availability of high-speed internet, the level of digital literacy, and the willingness of Indian consumers to embrace new technologies.”
As of 2022, India’s gaming industry is valued at USD 2.8 billion. It is predicted to grow at a compound annual growth rate (CAGR) of 28-30 per cent to USD 5 billion by 2025. This rapid adoption might just be the push that the Indian audience needs to accept metaverse as the new “advertising” normal.
Countering the main challenges
Particularly in the realm of metaverse-based in-game advertising, the basic challenge to counter is the balance between advertising and user experience.
“One of the basic challenges of running Metaverse-based in-game ads is ensuring that they are not intrusive or disruptive to the player experience. The Metaverse is an immersive and interactive space. Users are already being less receptive to traditional advertising methods such as banner ads or pop-ups”, explained the CEO of House of Gaming.
Thus, for metaverse-based in-game ads to work in India, brands will have to construct creative and engaging ways to incorporate their messaging into the game world in an authentic and organic manner.
“Additionally, affordability can also be a factor when it comes to running Metaverse-based in-game ads. Developing and implementing these ads may require significant investments in technology and talent, and brands may need to consider whether the potential return on investment justifies the expense”, cited the Seracle co-founder.
Ultimately, if the return-on-investment (ROI) is good, brands may be willing to take the metaverse route.
In a nutshell, the rise or fall of metaverse-based in-game ads will largely depend on two key aspects – execution and addressing user-needs.
About the author
Anjali Kochhar covers cryptocurrency stories in India as well as globally. Having been in the field of media and journalism for over three years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.