In-Game Advertising: A Whole New Game?

If you’re a hungry gamer, the only command you need remember is “/pizza.”

Sony recently inked a deal with Pizza Hut to allow players of the incredibly popular EverQuest II, a massive multiplayer online role playing game (MMORPG), to order pizza from Pizza Hut while playing the game online. Gamers just type “/pizza,” and the EverQuest engine brings up a browser window where they can order their pies. No more stopping in the middle of the action to pick up the phone and order, no more logouts to go pick up a pizza. It’s a gamer’s dream come true.

No financial details of the deal were released, but the partnership between the top pizza chain and the top online gaming property represents one of the first substantial advertising deals in the gaming industry. And considering games such as EverQuest have hundreds of thousands of subscribers from the coveted 18-24-year-old demographic, you can be sure advertisers targeting this demographic will watch this experiment closely.

There’s been talk about putting ads in games for a long time now, but few companies have pulled off true integration. Instances of product placement and games based on movie properties, sports franchises, and hot automobiles have been a staple for years. But the Pizza Hut/Sony deal is something different: true interactive integration between a game and an advertiser.

Sony and Pizza Hut aren’t the only ones looking at tighter integration between games and advertisers. New York-based Massive Inc. has launched the first in-game advertising network designed to dynamically serve (and measure) ads in a variety of games. Massive’s already lined up deals with some of the heaviest hitters in the game industry; it lists Ubisoft, Vivendi Universal Games, Atari, Legacy Interactive, Take 2 Interactive, Funcom, and Codemasters as “partners” on its Web site and is actively looking for new gaming properties that can incorporate its technology.

Massive’s ad model can take many forms, from more traditional ad placements on in-game virtual billboards and objects to time-based placements that take into account the environment and time of day when a player experiences the brand. Players might encounter a virtual storefront featuring Dunkin’ Donuts’ crullers in the morning and its lattes in the afternoon.

The ads’ dynamic nature also means content can be created and served up to promote products and services as they occur in the real world. As a player walks past a virtual poster, it might promote a new movie release. Next time, it might promote a CD launch.

I’ve written plenty about advergaming before, and I think it’s safe to say the advertising potential for games is huge and will continue to grow. Unlike passive entertainment, such as movies and CDs, most new games are online-enabled. This provides a channel for the kind of dynamic ad serving we’ve grown accustom to on the Web as well as a channel for feedback from potential customers. In many ways, it combines the best of high-bandwidth entertainment (such as movies and TV) with the Internet’s interactivity and direct-response capabilities.

The big question is whether gamers will accept ads in games. For most gamers (myself included), games are an escape, a way to enter another world, see new sights, meet interesting people, and blast the heck out of ’em. I don’t want to be battling aliens on far-off worlds and have to dodge behind Sony billboards for cover. It kind of ruins the moment, especially if I just paid $50 for the game.

The future of in-game advertising could rest more on financial models than content. Will some gamers put up with ads in games that are free (or cheap)? Will others pay a premium for an ad-free version? Another interesting experiment to watch is a new venture between Massive and Funcom. Funcom has incorporated Massive’s ad-serving technology into its popular Anarchy Online MMOG to create a free, ad-supported version of the game and a premium, ad-free version that carries a monthly fee.

Undoubtedly, in-game advertising is about to come into its own. From slash-pizza to ad-supported multiplayer games to in-game advertising cropping up in popular franchises such as UbiSoft’s Splinter Cell franchise, online advertising could just become a whole new game.

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